The firm that clears, settles and holds customer assets, often behind an introducing broker that handles the client relationship but touches no money.
Most retail-facing brokers do not self-clear. The introducing firm owns the app and the customer; the clearing firm is the member of nscc, holds the securities, extends margin and issues statements.
This matters when something goes wrong. Margin policy, hard-to-borrow availability and trading restrictions frequently originate at the clearing firm, not at the brand you signed up with.
Example: your statement carries your broker's logo but says "securities cleared through" another firm. When short availability in a volatile name dries up, the constraint is that clearing firm's inventory and clearing-fund position — which is why several unrelated apps restrict the same stock on the same morning.
Original diagrams for the ideas on this page. Illustrative, not real market data.
Margin and leverage. A $5,000 deposit can control a $100,000 position, which is 20:1 leverage. Because the loss is measured on the full $100,000, a 2.5% move against you halves the deposit and brings a margin call, and a 5% move uses all of it.
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