Which of the following is the best description of a "broken trade"?
A) when a trade has been agreed to with dates (maturities) different from the standard dates
B) when one of the parties to the deal unilaterally decides to withdraw from the on-going transaction
C) when, due to a system break, one or both parties to the deal chooses to withdraw from the ongoing transaction
D) when, due to a system break, one or both parties to the deal are unclear as to whether the deal has been done

Question

Quizplus · Accepted Answer

A "broken trade" refers to a situation where there is ambiguity or uncertainty over whether a trade has been executed due to a system break. In this case, one or both parties may not be sure whether the deal has been done or not. Choice A refers to non-standard maturities, which is a different issue. Choice B refers to a unilateral withdrawal, which is not a broken trade. Choice C refers to a situation where one or both parties choose to withdraw, but a broken trade is typically due to a technical issue rather than a choice by the parties involved.

Which of the Following Is the Best Description of a "Broken