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Meaning & use

cross trading

noun·Advancedfinancespecialist

Last updated

UK/ˈkrɒs ˌtreɪ.dɪŋ/
US/ˈkrɔːs ˌtreɪ.dɪŋ/

Meanings

  1. noununcountablefinance

    A transaction in which an investment manager or broker matches a sale from one client's account with a purchase for another client's account, without going through the open market.

    Grammar: Uncountable: cross trading is restricted by law in many places.

    Patterns

    • cross trading between accounts
    • cross trading of securities

    Regulators fined the firm for improper cross trading between client accounts.

    Cross trading can save fees, but it creates a risk of unfair pricing.

    The fund's rules ban cross trading unless a compliance officer approves it.

  2. noununcountablebusiness

    Trading goods between two countries that are not your own, such as a shipping company buying in one foreign market and selling in another.

    Grammar: Less common sense used in international shipping and commerce.

    Patterns

    • cross trading between countries

    The shipping line made most of its money from cross trading between Asian ports.

    Cross trading allows vessels to carry cargo between two foreign countries.

    Local traders took part in cross trading along the old caravan routes.

Common combinations

cross trading rules
The cross trading rules protect clients from unfair prices.
illegal cross trading
The broker was investigated for illegal cross trading.
engage in cross trading
The firm does not engage in cross trading.
cross trading policy
The compliance team wrote a new cross trading policy.

Synonyms and how they differ

internal matching
Internal matching is a neutral industry phrase for the same process, while cross trading often suggests regulatory concern.
crossing
Crossing is the short trader's word for matching buy and sell orders, while cross trading is the fuller term for the practice.
matched trade
A matched trade is a single deal of this kind, whereas cross trading is the general practice.

Opposites

open-market trading

Word family

cross trade noun
a single transaction of this kind
trader noun
a person who buys and sells
trade verb
to buy and sell
cross-border adjective
involving more than one country

Commonly confused: cross trading or cross-border trade?

cross trading vs cross-border trade

Cross-border trade means trading between countries, whereas financial cross trading is about matching clients' orders inside a firm.

Practice

An asset manager sells shares from one client's account directly to another client's account at the same moment. This practice is called ___.

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