Top 4 Custody Interview Questions
Browse 4 real-world technical and behavioral interview questions about Custody. Review scenarios, edge cases, and architectural best practices.
A dividend is declared and half the client's holding is out on loan while part of the rest is pledged as collateral. Who receives the income, who votes, and what does your system show the client?
Lending transfers legal title, so the lender receives a manufactured payment from the borrower and cannot vote the lent stock. Whether a pledge does the same depends on whether it is a title transfer or a security interest. The client still needs one economic position, with the legal breakdown reported underneath it.
A corporate action is confirmed with an effective date in the past, after you have already struck positions and sent statements. How does your system cope?
By storing when something became true separately from when you learned it, so the old report stays reproducible while the corrected position takes effect from the event date. The engineering work is in the fan-out to everything already derived from the wrong quantity, not in the entitlement posting itself.
Walk me through the lifecycle of an equity order from the click to settlement.
An equity order is validated and risk-checked at the broker, routed to a venue, matched by price-time priority into one or more fills reported back as execution reports, allocated to end accounts, novated to a clearing house that becomes the counterparty, and finally settled against cash at the custodian on T+1.
A client says your position does not match their custodian statement. How do you work out who is right, and what does a corporate action do to that answer?
A position is what you have traded, a holding is what the custodian says you own, and they legitimately differ by unsettled trades and pending entitlements. Reconciliation compares both against the custodian's statements, and corporate actions break it when an election deadline is missed. Use this custody answer to show the decision, trade-off, and evidence rather than a memorised definition.