Strate - Glossary

A
ACSDA	American Central Securities Depository Association.
Affirmation	When used in the context of a comparison or matching system, affirmation refers to the counterparty’s agreement with the terms of the trade as communicated.
AGC	Association of Global Custodians.
AMEDA	Africa and Middle EastDepositories Association.
Announcement	Notices regarding rights accruing to owners of Securities, which are published by Issuers by means of the Securities Exchange News Service (SENS) of the JSE, and, where provided to the CSD, company reports and circulars.
Arbitrage	The process of buying and selling similar Securities in different markets to take advantage of the price difference.
B
Back-to-Back link	If delivery of Securities is dependent upon the successful receipt of the same Securities, then the two orders must be linked via Back-to-Back functionality.
BCP	Books Closed Period. The period during which the Register of Members is closed for registration of transfers immediately prior to a benefit distribution.
BDA	Broker Deal Accounting service provided by the JSE. The system keeps the Securities records and books of individual broking firms in respect of their Clients.
Beginning of Day (BOD)	The time as stipulated in Directive SCC – Operation Market Windows – Equities.
Beneficial Owner	The true owner of the Securities, as opposed to the custodian or a Nominee through whom the Securities may be held and/or in whose name the Securities may be registered.
Benefit distribution	A distribution made by companies to holders of their Securities in the form of cash or Securities, usually in proportion to their holding. Cash benefits include dividend and interest payments. Securities distributions include rights, bonus and other entitlement issues. Also known as entitlements.
BESA / Bond Exchange	The bond Exchange of South Africa, a Self Regulating Organisation SRO was responsible for the regulation of the bond market and governed by the Financial Markets Control Act (FMCA) of 1989 or any replacement Act (Replaced by the Securities Services Act No 36 of 2004.
BIC code	Bank Identifier Code. This is the SWIFT identifier code of organisations with a SWIFT address.
BMA	Bond Market Association.
BND	Beneficial Ownership Download. A monthly download containing Beneficial Owner information of dematerialised holdings, provided monthly by- Participants to Strate Strate to the Issuer Brokers to Strate Strate approvedNominees to Strate
BOD	Beginning Of Day - the series of processes executed by the CSD at the beginning of every Business Day.
Bond Indenture	A legal contract specifying the terms and conditions between the Issuer and investor.
Book entry system	An accounting or ledger system which facilitates the holding and transfer of Securities electronically. This enables the transfer of Securities between accounts, without the need for physical movement of share certificates and other documents.
Broker	Broker/Authorised User/Member, being a person authorised by an Exchange in terms of the Exchange Rules to perform such Securities Services as the Exchange Rules may permit.
Broker	Broker is a trading party, who trades in the Security market either for it'self or for it's Clients. Also referred to as a Member or Authorised User.
BRS	Business Requirement Specification.
Business Day	Any day which Strate does business, except a Saturday, Sunday or public holiday or any other day that Strate is closed. Strate can in it’s discretion decide to accommodate the opening of an operational window on a non-Business Day, provided that- Strate has three Business Days prior notice of the requirement; and all other parties involved have been informed by the requesting party.
C
C & S	Custody and Settlement.
CA	See Corporate Actions.
Capital Gains Tax (CGT)	A tax on profits realised from buying a Security at one price and selling it (or holding it to redemption and then redeeming it) at another.
CASA	Custody and Administration of Securities (Act No 85 of 1992) as amended or replaced from time to time and includes regulations issued there-under.

Central Bank	Major regulatory bank in a nation's monetary system, generally government controlled. Its role normally includes control of the credit system, note issuance, supervision of commercial banks, management of Exchange reserves and the national currency's value, as well as acting as the government's banker.
Central Securities Depository [CSD]	Strate limited (“Strate”), Registration no 1998/022242/06, registered as a Central Securities Depository in terms of the SSA.
Central Securities Depository Participant[CSDP] or “Participant”	A person who holds in custody and administers Securities or an interest in Securities and who has been accepted in terms of section 34 of the SSA by a Central Securities Depository as a Participant in that Central Securities Depository.
Certificate	A paper document, also known as physical Securities , attesting to the holders ownership of an Issuers Securities.
Clearing and Settlement System	The system which collects, processes and transmits the information which enables settlement
Clearing	The process, in conjunction with settlement, of determining accountability for the exchange of money and Securities between counterparties to a transaction. Clearing creates binding statements of obligation for Securities and/or cash due.
Client	Client is a third party, individual or organisation, who through a Broker or Participant, participates in the Security market for trading and clearing and settlement.
Collateral	Security provided by a borrower to a lender to secure Securities loans.
Commitment or Commit	An electronic instruction that constitutes an undertaking by a Participant to settle a transaction in uncertificated Securities on Settlement Date.
Company	A company incorporated under the Companies Act, 2008.
Contract note	This is a note which the broker is required to send to a Client recording the details of a purchase or sale of Securities, including the commission payable, the basic charge, the STT and the settlement period.
Contractual settlement	The market convention embodied in the Rules of the JSE whereby a Client has a contractual obligation to cause a trade to be settled on settlement day.
Corporate Actions/event	Corporate Action or Corporate Event means an action taken by an Issuer or any other entity or third party which affects the owners of Securities in terms of entitlements or notifications.
Corporate Actions/event	An action taken by the Issuer or any third party, that results in changes to the capital structure or financial position of the Issuer of a Security, that affects any of the Securities issued by an Issuer, and which affects the Beneficial Owner of uncertificated Securities in terms of an entitlement.
Counter	A single listed instrument, such as Harmony options. When we refer to the number of counters already on Strate, this figure includes options, preference shares, ordinary shares etc. When we refer to the number of companies on Strate, the figure will be less as Harmony Gold Mining, for example, will only count as 1 (even though it may have ordinary Securities and options listed).
Counterparty risk	The risk that the counterparty involved in the transaction will default on it's obligations.
Counterparty	One party to a trade. A trade can take place between two or more counterparties. Usually one party to a trade refers to it's trading partners as counterparties.
Coupon	The amount of interest an Issuer has agreed to pay through the life of the bond to the investor.
Cross border trading	Trading which takes place between persons or entities from different countries.
Cum	Including or qualifying for an entitlement arising from a Corporate Action.
Current market value	The market price of the listed Security at the time of settlement default by the Member.
Custodian	An entity which holds Securities in safe custody on behalf of third parties.
Custody	The safekeeping and administration of Securities and financial instruments on behalf of third parties.
D
Declaration data	The minimum information to be announced on the declaration date. (e.g. Security name, ISIN, event type, LDT, RD, Payment date etc).
Declaration Date (DD)	The date on which the Corporate Action and the Declaration data (including any conditions precedent to which the Corporate Action is subject) are announced.
Default for election	The option that will be applied to the Client’s holdings if no Corporate Action election is made.
Default	When one party to a trade fails to consummate the terms of its agreement.
Delivery versus Payment [DVP]	The good delivery of Securities in exchange for the simultaneous, final and irrevocable payment of cash.
Dematerialisation	The elimination of physical certificates or documents of title which represent the ownership of Securities so that the Securities exist only as electronic records.
Deposit	A deposit of Securities for safe custody.
Derivative	A derivative is an instrument whose value is derived from something else
Dividend	That part of a company's earning which is distributed in cash or in specie to shareholders.
DMF	Dispossessed Members Fund.
E
Election Date (ED)	The date by which the Participants must have received the election instructions from all their Clients, including brokers, fund managers, global custodians etc.
Election deadline	The time on the last day on which the Participant will accept an election from its Client or alternatively, Strate will receive the aggregated Client elections from a Participant.
Election	The exercise of any or all of the elective, voting, conversion, redemption or other rights attached to Securities.
Electronic Funds Transfer [EFT]	The transfer or movements of funds by electronic means.
Entitled Security / code	Long name and Security code for the Security on which a Corporate Action entitlement is awarded.
Entitlement	The exercise of any or all of the elective, voting, conversion, redemption or other rights attached to Securities.
EOD	End Of Day – means the time as stipulated in Directive SCC – Operational Market Windows - Equities.
EOD	End Of Day - the series of processes executed by the CSD at the end of every Business Day.
Equity	Share capital of a company. Also known as Securities.
Ex	Excluding or non-qualifying for an entitlement arising from a Corporate Action.
Ex-date (LDT + 1)	The date from which any transaction in that Security excludes the right to receive entitlements relating to the relevant Corporate Action. Ex-date is equal to LDT+1.
F
Failed trade	Any Securities transaction that does not settle on contracted Settlement Date because one of the settlement parties does not meet the settlement conditions. A failed trade may have negative consequences for the party at fault, including buy-ins and penalties.
Finalisation Date (FD)	The date on which the event and its details become unconditional in all respects and irrevocable i.e. no further changes to any of the pertinent details can be made by the Issuer and the event can only be cancelled in certain circumstances.
Finalisation Information	Final information on the Corporate Action to be included in the announcement on the Finalisation Date (e.g. Security name, ISIN, event type, LDT, RD, Payment Date etc).
First day to trade (FDT)	This is the first Business Day on which newly issued Securities may be traded.
First day to trade (FDT)	This is the first Business Day on which newly issued Securities may be traded.
FMAB	Financial Markets Advisory Board.
FMCA	Financial Markets Control Act of 1989 (Act No 55 of 1989).
Foreign investment restrictions	Regulations designed to control foreign investment activity in a particular country. Restrictions are used to maintain and protect a country's financial system. Restrictions include Foreign Exchange controls - to maintain and protect the value of its currency; Foreign investment regulations - to control foreign.
Form CM42	A transfer form deed to be executed by the transferor and to be executed by the transferee if he/she wishes to register the Security in his/her (transferee's) name. (Used for certificated Securities).
Forward-dated trade	A trade that is to be settled at a future date more than three Business Days after Trade Date.
Forwards	A forward contract is a contract made today for future delivery of an asset at a pre-specified price.
FSB	Financial Services Board.
G
G30	The Group of Thirty, a private group of prominent, international financial industry participants which in 1989 proposed nine standards for improving the world Securities industry's efficiency and reducing settlement risks. The G30 standards have been adopted as goals by financial market regulators worldwide.
Gross settlement	The settlement of transactions on a trade-by-trade basis, without aggregation or netting.
GSTPA	Global Straight-Through-Processing Association.
Guarantee fund	A fund maintained by an Exchange to recompense investors when a broker fails to meet its obligations.
I
ICSD	International Central Securities Depository.
Immobilisation	Immobilisation is the central storage of share certificates or documents of title in the vault of a CSD. Each depositor (Participant) is entitled to a share of the depository's entire holding of each class of Security in the proportion of his/her deposit to the aggregate holding, and these records are maintained electronically. Transfers between Participants are recorded electronically, without the need for any physical movement of the certificates or documents, unless they are withdrawn from the depository.
Inside information	Is defined as means specific or precise information, which has not been made public and which- (a) is obtained or learned as an insider; and (b)if it were made public would be likely to have a material effect on the price or value of any Security listed on a regulated market.
Instrument	A global term for Securities encompassing a range of financial debt from negotiable deposits to bonds.
Intermediary	A collective term for professional Securities industry participants who act as go-betweens. An intermediary typically stands between Issuers and investors. Intermediaries include inter alia, broker, financial institutions, banks and custodians.
IOSCO	International Organization of Securities Commissions.
IRBA	Independent Regulatory Board for Auditors
ISIN	International Securities Identification Number.
ISLA	International Securities Lending Association
J
JSE	JSE Limited. Registration Number 2005/022939/06
L
Last Day to Trade (LDT)	Last Day to Trade, which is the last date that anyone can trade On-market in order to qualify or participate in a Corporate Action.
LDT+X	Last Day to Trade plus X Business Days, “X” being the number of Business Days stipulated by the announcement or Directive.
Listing Date (LD)	This is the date on which new Securities are listed.
M
Market capitalisation	The total valuation of all Securities listed on a stock Exchange or the total value of particular types of Securities.
MFA	Master File Administration.
Mother Security ISIN	ISIN for the Security on which a Corporate Event has been declared.
Mother Security	Long name and Security code for the Security on which a Corporate Event has been declared.
MT XXX	The applicable SWIFT message type as identified by SWIFT from time to time.
N
Name /code	A process of summing trades to arrive at a nett settlement position. This means settlement of cash or Securities balances by summing all credits and countervailing debits for a given day or session, then moving cash or Securities only in the amount of the nett total.
Nett settlement	The settlement of Securities or cash, or both, based on the arithmetic sum of trades in the same class of Securities for settlement on the same day by the same person.
Netting	A process of summing trades to arrive at a nett settlement position. This means settlement of cash or Securities balances by summing all credits and countervailing debits for a given day or session, then moving cash or Securities only in the amount of the nett total.
Nominee	Person that acts as the registered holder of Securities or an interest in Securities on behalf of other persons.
Non-Elective Benefit	A benefit which automatically accrues to a shareholder and is disbursed by the Issuer pursuant to a Non-Elective Event.
Non-Elective Event	A Corporate Event that takes place with no action required on the part of the holder of the Security, and where Non-Elective benefits that accrue to shareholders are automatically disbursed by the Issuer in line with the terms of the Corporate Event.
Non-standard trade	A trade which is to be settled less than three Business Days after Trade Date
NPL	Nil paid letters
NPS	National Payment System.
O
Odd lots	A quantity of Securities which is less than 100, or a quantity specified by the Issuer as being an odd-lot.
Off-market trade or Off-Exchange or OTS	An Off-market order is a trade in uncertificated Securities which is not concluded through the Exchange and is reported by the seller and purchaser of the uncertificated Securities to the relevant Participant for settlement through the CSD.
Omnibus account	An account held in the name of an entity or person which may be used for placing and clearing the trades of one or more undisclosed customers of the account holder.
On-lending	The process whereby a party, other than a lending agent, who has borrowed Securities from a lender, does not use them to meet a sale obligation, but instead lends them to a third party.
On-market or On-exchange trades	An On-exchange trade is a transaction (buy or sell) in uncertificated Securities which is concluded through the Exchange (via a broker) for settlement through the CSD.
On-market trades or On- Exchange or BMA Order	An On-market trade is a transaction (buy or sell) in uncertificated Securities which is concluded through the Exchange (via a broker) for settlement through the CSD.
Order	Payment Association of South Africa.
P
PASA	An offer to sell, or a bid to buy, an agreed quantity of Securities at a fixed or determinable price.
Payment Date (PD)	The date on which Corporate Action entitlements are paid.
Payments system	The system used to achieve settlement of cash in a Securities transaction.
Pledge	The use of Securities as collateral in a financial transaction. Securities may be pledged electronically within a central depository, or physically outside of a central depository.
Principal/Nominal Amount/ Face Value/Par	This is the amount that will be paid at maturity.
Projected holdings	For the purpose of a Corporate Action election, the total holdings of Securities as at LDT adjusted for any unsettled transactions in the affected Securities that are due to settle on or before Record Date.
Proxy voting	Acting or speaking for an absent shareholder on issues surrounding the management of the company at shareholders' meetings.
Proxy	Written authority to act or speak for an absent shareholder at shareholder meetings.
R
Ratio	Basis of Security entitlement reflected as a ratio.
RD-X	The Record Date minus X Business Days “X” being the number of Business Days stipulated in the announcement or Directive.
Recall	The right exercised by a lender whereby a borrower is requested to return the Securities that have been borrowed within a specified time frame.
Record Date (RD)	The date on which the holdings, upon which the Corporate Action entitlement is based are ascertained. RD is equal to LDT+5.
Redemption	Partial or full return of the debt or Securities to the Issuer in exchange for a cash value.
Refinance	The process whereby a borrower closes out a loan with one lender and re-borrows it from another lender at a cheaper rate .
Register of Members	A register maintained by an Issuer or his Agent, which contains the identity and shareholdings of holders of Securities. It is also known as the register of shareholders.
Registered Auditor	An individual or firm registered as an auditor with the Independent Regulatory Board for Auditors in terms of the Auditing Profession Act 2005 (Act No. 26 of 2005).
Registration	The recording of legal title to Securities in the books of the Issuer.
Rematerialisation	The issuance of certificates to permit the physical withdrawal of previously dematerialised Securities positions held at the CSD.
Retail investor	Individual investors who generally deal in smaller amounts than the professional or institutional investors.
Rights issues	Rights to buy additional Securities through an issue granted to existing holders of the original Securities.
Rolling settlement	A settlement environment in which transactions (Securities and funds) become due for settlement a set number of Business Days after Trade Date.
RTGS	Real Time Gross Settlement.
RvP	Receive versus Payment.
S
S	Settlement Date.
SAFE	SAFIRES Front End.
SAFEMS	South African Futures Exchange Management System.
SAFIRES	Southern African Financial Instruments Real Time Electronic Settlement System that is the composite electronic settlement system used by Strate which caters for issuing, custody, clearing and settlement of Securities and is the depository system for Strate.
SAICA	The South African Institute of Chartered Accountants.
Same day settlement	A trade booked to the CSD on the same day on which settlement occurs, irrespective of the actual Trade Date.
SAMOS	South African Multiple Options System - National Payments System of SARB.
SARB	South African Reserve Bank.
SASLA	South African Securities Lending Association.
SCA	Safe Custody Account.
Secured versus Unsecured Debt	Secured debt is backed by a legal claim on some specified property/collateral. The debt holders (lenders)will have a senior claim on the assets in the event of default.
SENS	Securities Exchange News Service of the JSE.
Settlement	The completion of a transaction, whereby Securities and corresponding cash are delivered and received.
SFIDvP	Simultaneous, Final, Irrevocable Delivery versus Payment.
SI	Settlement Instruction.
SLB	Securities Lending and Borrowing.
SMPG	Securities Market Practice Group.
SPN	Strate’s Private Network.
SRO	Self Regulatory Organisation.
SRO	Self Regulatory Organisation.
SSA	Securities Services Act (No 36 of 2004).
Standard trade	Trade that is to be settled on the third Business Day after Trade Date. This is also referred to as a “Spot” trade.
STP	Straight-Through-Processing. The automated, end-to-end processing of a transaction from matching through to settlement, without the need for manual intervention.
Strate Circular	The agreed upon procedures for Registered Auditors reporting on factual findings in terms of the CSD Rules as issued by the CSD.
STT	Securities Transfer Tax.
SWIFT	Society for Worldwide Inter-bank Financial Telecommunication.
T
T	Trade Date, which is the date on which a particular transaction was entered into.
T+X	Trade Date plus X Business Days, “X” being a number of Business Days.
TCS	Tata Consultancy Services.
Trade matching	Matching of buy and sell orders.
TradElect	The trading platform of the JSE.
Transfer Secretaries	An individual or organisation that, inter alia, maintains the Register of Members on behalf of the Issuer of Securities.

Glossary

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