Accounting for Netted Positions

Actual Positions in a Portfolio are netted together whenever one of the following occurs:

A previously unsettled position in a security has now settled and it now needs to be netted with an already settled position in the same security. [ See also Settle All Positions. ]
A settled position in a security from another portfolio is being moved into a portfolio which already has a settled position in the same security.

In both these cases, the already settled position has priority and it "absorbs" the position that needs to be netted with it.

Whenever two positions are aggregated or netted together, their accounting information is also netted together.

If the absorbing position has a different transaction currency from that of the position it must absorb, the second position's accounting information is first automatically converted into the absorbing position's transaction currency - at the spot exchange rates specified in the Default World State.