Netting and guaranteeing trades through a central counterparty that steps between buyer and seller.
After a trade, a central counterparty becomes the buyer to every seller and the seller to every buyer. If one side defaults, it steps in, backed by collateral from its members. In the US, the National Securities Clearing Corporation (part of DTCC) clears stock trades; in Europe, firms like Eurex Clearing and LCH do.