Following the transmission of a settlement instruction to and the acknowledgement of receipt by the custodian, the next steps in the trade lifecycle are:
Pre-value date settlement instruction matching is a very important component of the trade lifecycle, as in most cases settlement (the actual exchange of securities and cash) cannot take place without it.
Furthermore, STP can be achieved where the detail of the seller's and buyer's settlement instructions match first time, on or very shortly after trade date. Although STP is the objective, the reality is that a large number of settlement instructions typically remain unmatched at the end of the trade date; the reasons for this will be explained throughout this chapter.
The processes of: