Clearing house: An entity which sits in the middle of a trade, assuming the counterparty risk involved when two parties (members of the clearing house or their clients) trade. When the trade is registered with a clearing house, it becomes the legal counterparty to the trade, so that the clearing house takes on the counterparty risk and underpins the associated financial market - facilitating trading and increasing confidence within the market.

Counterparty
Counterparty
Counterparty
Clearing house in our glossary: terms and definitions

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