Explain trade lifecycle

Question

Accepted Answer

Trade lifecycle refers to the stages involved in a trade from initiation to settlement.

The trade lifecycle includes trade initiation, trade capture, trade confirmation, trade matching, trade settlement, and trade reconciliation.
During trade initiation, the trader decides to buy or sell a security.
Trade capture involves recording the details of the trade, such as the security, quantity, and price.
Trade confirmation is the process of verifying the details of the trade with the counterparty.
Trade matching involves comparing the details of the trade between the buyer and seller to ensure they match.
Trade settlement is the process of exchanging the security for payment.
Trade reconciliation involves ensuring that the details of the trade are accurately recorded in the books and records of both parties.
Examples of securities that can be traded include stocks, bonds, and derivatives.

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