What Is Netting?

Netting is the process of balancing the value of several positions or payments owed to two or more parties. In a multiparty agreement, it can be utilized to identify which party is entitled to compensation. Netting is a broad term with a variety of applications, notably in the financial markets.
Netting is utilized in a variety of situations, including stocks and currency trading, insolvency, and inter-company transactions, to name a few.