Clearing and Settlement System
The central clearing facility for the Allocated Bullion Exchange processes all orders internally without the need for any 3rd party clearing house.
There are 2 potential settlement process that each order can be place under. It is the default of the system that all orders are completed instantaneously, however, this is dependent upon tradeable bullion physically existing within that particular market vault.
If not, then the order is place into the trading cycle of the Liquidity Providers (ABX approved precious metals refiners) and any outstanding bullion will be physically vaulted at the respective market vault in no more than 15 days from trade execution. Both trades are cleared on an allocated basis.
To learn more about this and what goes on and how to tell which settlement process you are put on, go to our page about the clearing and settlement system of the Allocated Bullion Exchange.
Holder Identification Number (HIN)
The clearing facility of the Allocated Bullion Exchange uses HINs (Holder Identification Number). The HIN acts as legal title to the physical asset that allows the owner of the bullion to be identified and is an integral part of managing bullion in the ABX global storage network.
HINs are unique electronic tags that are connected to every account Holding. Each item of physical bullion held in a Holding has that account's specific HIN associated with it.
Upon a trade being executed (assuming T+0), the physical bullion product instantly receives the new HIN that is associated with the Buyer's account.
The use of HINs therefore allow for instant trading and allocation of physical precious metals to investors, allowing the marketplace to function with as much speed and ease as the paper based bullion markets do.
This all comes with the added benefits of higher premiums for sales and greater liquidity, as physical bullion holds greater demand than its paper equivalent.