Settlement management for transactions

By default, a transaction automatically settles on the contractual date stipulated in its settlementDate field. At this point, LUSID updates the settledUnits field of all security (‘stock’) and/or currency (‘cash’) holdings impacted by that transaction.

Consider the following example, of a purchase of BP shares in GBP using the built-in Buy transaction type:

• On the transaction date, LUSID updates the units field of a BP stock holding and a GBP cash holding. Note the units field records the total number of units, settled and unsettled.

• On the settlement date, LUSID updates the settledUnits field of the BP stock holding and the GBP cash holding.

Note: LUSID temporarily classifies the cash impact of a transaction as an independent ‘unsettled cash’ holding between trade and settlement dates. At settlement, LUSID merges temporary holdings into the core (settled) cash balance for the currency. More on holding types.

Available settlement strategies

You can configure LUSID to enable more sophisticated settlement strategies for stock holdings, cash holdings, or both.

For example, you could choose to continue settling stock automatically on the contractual date (as per the default behaviour), but only settle cash upon explicit instruction at a later date:

Note the following about this strategy:

• Configuring stock for automatic settlement gives you more flexibility than the default LUSID behavior. You can choose to cancel settlement, or settle by instruction on an ad-hoc basis (perhaps for a particularly risky or high-volume trade).

• Configuring cash for settlement by instruction means that if such an instruction is not received then these units never settle; there is no timeout.

Alternatively, you could choose to settle cash in stages by loading multiple partial settlement instructions, for example:

Or you could choose to settle cash in a different currency to that of the original transaction:

To get started, configure LUSID to enable settlement strategies.