On settlement date, all trades due to settle are netted by issue to a net long (buy) or a net short (sell) position, and then are further netted with any instant withdrawal online casino usa miscellaneous activities, including ID Net transactions, and open positions from the previous day.
The CNS automatic delivery process occurs in two cycles: the “night cycle,” which begins the night before settlement, and the “day cycle” on settlement day.
CNS short positions, which represent securities owed by Members to NSCC, are compared against their DTC accounts to determine availability. If shares are available, they are delivered from the Member's account at DTC to NSCC's account at DTC to cover Members' short obligations to CNS. Members can use CNS exemptions to control the automatic delivery of securities from their DTC accounts (partial settlements are permissible).
CNS long positions, which represent securities NSCC owes Members, are processed in an order determined by an algorithm. Securities are automatically allocated to users' long positions as they are received by NSCC. Members can request priority for some or all issues on a standing or override basis. Buy-in submission notices also will affect the priority of a Member's long position.
Daily money settlement is based on the value of all settled trades plus or minus mark-to-the-market calculations for all open CNS positions.
CNS System provides the following three ancillary services:
- The Fully-Paid-for-Account provides Members with a "good control location", as required by the Customer Protection Rule (Section 15c3-3 of the Exchange Act) for Members' fully-paid-for customer securities in the event of a deficit that results from deliveries made outside CNS in anticipation of CNS receives.
- Reorganization sub-accounts allow Members to take part in voluntary tender and exchange offers in an automated environment.
- Members may issue buy-in intents to CNS once a security has failed. After CNS receives a buy-in, the issuing Member will be placed on high priority to receive the securities. Members who owe shares to CNS will be passed liability for the shares of the buy-in.