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1492 terms

Glossary

Every term is defined twice: once the way a filing would put it, and once the way somebody would explain it to you across a table. The second one is usually the one that sticks.

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Novation

Market basics

The clearing corporation interposing itself as buyer to every seller and seller to every buyer, replacing one contract between strangers with two against a guaranteed central party.

In plain terms

The mechanism that lets you buy from somebody whose creditworthiness you know nothing about. It guarantees settlement, and says nothing at all about the value of what you bought.

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Indian stock market glossary · Market Vidyalaya