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NSCC’s ETF process provides the following efficiencies and risk controls around the creation and redemption of ETFs:

  • Provides Members with the ability to select only the portfolios they need for next day’s trading through a web based on-line view. Through this mechanism, Members can download the portfolio details in an Excel spreadsheet format.
  • Enables Members to elect to receive a nightly Portfolio Composition File (PCF) data file containing information that pertains to the ETF for the following trading day. This information is also available through the ETF web-based tool.
  • Supplies an instruction detail file containing the details for each create and redeem
  • Provides Members with the ability to submit a supplemental portfolio on trade date for standard and custom portfolios.
  • Reduces manual deliveries.
  • Provides clearance and settlement of the ETF, as well as the underlying components, through NSCC's CNS and non-CNS settlement processes. When eligible, settlement of the underlying components of ETFs and certain eligible ETFs through CNS (minus the transaction fee) are guaranteed by NSCC.
  • Allows Members to create or redeem ETFs on T+2 or T+1 (next day) basis.
  • Allows Members to create or redeem a customized portfolio with cash in lieu of securities.
  • Allows Members to create or redeem a portfolio either against cash or through the exchange of securities.

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