What is trade life cycle? Explain various stages and departments that work?

Question

Accepted Answer

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

Various stages include trade initiation, trade execution, trade confirmation, trade settlement, and trade reconciliation.
Departments involved may include front office (traders), middle office (risk management), back office (settlements), and compliance.
Example: In a stock trade, the trade initiation involves placing an order, trade execution involves matching the order with a seller, trade confirmation involves verifying the details, trade settlement involves transferring funds and securities, and trade reconciliation involves ensuring all details match.

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