Definition of Continuous Net Settlement (CNS)

method of securities clearing and settlement that eliminates multiple fails in the same securities. This is accomplished by using a clearing house, such as the National Securities Clearing Corporation, and a depository, such as Depository Trust Company, to match transactions to securities available in the firm's position, resulting in one net receive or deliver position at the end of the day. By including the previous day's fail position in the next day's selling trades, the firm's position is always up-to-date and money settlement or withdrawals can be made at any time with the clearing house. The alternative to CNS is window settlement, where the seller delivers securities to the buyer's cashier and receives payment.