STOs buy and sell securities many times during each day, but in addition, an STO executes other types of transactions in order to manage its business properly on a day-to-day basis.
In general terms, the purchase (or sale) of goods is one type of transaction, whereby an agreement is made to exchange one asset for a different asset. This transaction is intended to be a single action that does not involve the return of the assets to the original seller and buyer at some later date.
To make an analogy with a car dealer, it is expected that the main type of transaction would be the purchase and sale of cars. However, the cars that have not yet been sold could be rented to customers prior to being sold; a rental transaction has characteristics that differ from a sale transaction, in that there would be a rental start date and end date with a fee payable by the customer. In addition, the car dealer could use a car as collateral against a borrowing of cash and the features of this transaction would differ from the previously mentioned transaction types.
Each of the above transactions by the car dealer involves two assets, the car and the cash, with each transaction being effected for different reasons, namely: