The Options Clearing Corporation is a clearing organization that acts as the issuer and guarantor for option and futures contracts.
This article will explain the basics of the Options Clearing Corporation. It is important to understand what the OCC is because they ensure that the obligations on contracts that they clear are fulfilled.
The OCC is registered under the jurisdiction of the SEC and CFTC. This means that the OCC clears transactions for call and put options, stock indexes, foreign currencies, interest rate composites, futures, and options on futures.
Ultimately, the OCC protects investors from being scammed in their option and futures contracts. They promote stability and financial integrity in the marketplace by focusing on risk management. The OCC makes sure that contracts are being fulfilled.
The Options Clearing Corporation was founded in 1973 and is the largest equity derivatives clearing organization in the world. A board of directors, made up of representatives from exchanges, clearing members, public directors and management, oversee the OCC. Its revenue comes from clearing fees charged to its users.
The OCC is an important organization that ensures investor’s safety in their option and futures contracts. Knowing what the OCC does is a good note to keep in mind.