Good Delivery
Contents
Demystifying Good Delivery: A Comprehensive Guide
Understanding the Concept of Good Delivery
Good delivery, in the realm of securities trading, signifies the smooth transfer of ownership from seller to buyer, meeting all requisite conditions. While modern electronic exchanges have streamlined this process, historically, it involved physical inspections and authentication of paper certificates by transfer agents.
The Evolution of Good Delivery
In the past, ensuring the authenticity and proper registration of stock certificates posed challenges for buyers. Regulated stock exchanges and clearinghouses emerged as trusted intermediaries, standardizing requirements and facilitating seamless transactions. Today, electronic trading and settlement systems have largely mitigated these concerns.
Criteria for Good Delivery Across Markets
The criteria for good delivery vary across markets and securities but are essential for transaction settlement. Stock markets often require adherence to specific denominations, such as multiples of 100 shares, while bond markets mandate delivery in multiples of par value. Commodities markets outline explicit criteria, as seen in the specifications set by the London Bullion Market Association for physical gold.