Examples of clearinghouse in a Sentence
an online clearinghouse for information on museums around the world
Recent Examples of clearinghouse from the Web
There were other targets that signed LOIs with UAB but must pass the NCAA clearinghouse before being added to the 2018 signing class.
Another $242,000 came through Act Blue, a Democratic clearinghouse.
The center bills itself as an independent clearinghouse for information on diseases and vaccine science and policy.
City officials must release the names and some contact information of people who logged a report with Portland's clearinghouse for homeless complaints.
Texas Humor, the clearinghouse for all things Texan on social media, noticed and shared a dank meme making fun of the pillow.
The campaign had the DNC on life support, giving it money every month to meet its basic expenses, while the campaign was using the party as a fund-raising clearinghouse.
The problem with this picture is that scientists cannot find anything physical in the brain that seems to act as the clearinghouse.
The Chamber event was held on the same day the arbitration rule was formally published in the Federal Register, the government’s clearinghouse for regulations.
These example sentences are selected automatically from various online news sources to reflect current usage of the word 'clearinghouse.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.
First Known Use of clearinghouse
Financial Definition of CLEARINGHOUSE
What It Is
A clearinghouse is an intermediary between buyers and sellers of financial instruments.
How It Works
Clearinghouses take the opposite position of each side of a trade. When two parties agree on the terms of a transaction, a clearinghouse sits in the middle, acting as both the buyer and the seller. Clearinghouses exist to ensure the smooth functioning of financial markets. Fewer transactions would take place if sellers were worried that buyers would refuse to pay them, and vice versa. A clearinghouse ensures that transactions happen as planned.
For example, if you agree to sell your 100 shares of Company XYZ to John for $10,000, the clearinghouse ensures that John is delivered the 100 shares and you are delivered $10,000. It also records and reports the transaction to everyone involved. Either way, the clearinghouse is responsible for ensuring that the transaction happens in an accurate and timely manner.
Clearinghouses operate in most areas of the business world. For example, in the futures markets, clearinghouses ensure that the buyers and sellers fulfill their obligations related to the futures contract being traded and oversee the proper delivery of the underlying instrument. A country's central bank (e.g. the Federal Reserve in the U.S.) acts as a clearinghouse for checks, interbank payments, foreign exchange transactions, and other fund transfers in the banking system.
Why It Matters
Clearinghouses, acting as middlemen between buyers and sellers, provide both efficiency and stability to the financial markets they serve. However, they take on a high amount of risk because they act as both buyer and seller for a brief moment in almost every transaction. If a buyer fails to pay for the securities he has purchased, the clearinghouse must seek recovery of the funds or wait for them to become available.
Because the clearinghouse is on the hook if either party defaults on their agreement, they generally will not process transactions for traders who take on too much risk. To mitigate risk, clearinghouses also often require traders to deposit additional funds into their brokerage accounts in order to maintain minimum "margin requirements." These funds ensure that the clearinghouse will have access to enough funds to offset losses incurred by traders to get in over their heads and fail to meet their financial obligations.
CLEARINGHOUSE Defined for English Language Learners
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