Valoren Number: What It Is and How It Works

An in-depth exploration of the Valoren Number, an identification number assigned to financial instruments in Switzerland. Discover its significance, usage, and comparison with similar identification systems like CUSIP.

Valoren Numbers are identification numbers assigned to financial instruments, such as stocks and bonds, in Switzerland. These numbers function similarly to CUSIP numbers used in Canada and the United States. They play a critical role in the identification and trading of financial instruments.

Origin and Purpose

The Valoren Number system ensures uniquely identifying securities within the Swiss financial market. This aids in the smooth operation of buying, selling, clearing, and settlement processes.

Structure of Valoren Numbers

A Valoren Number is typically a numeric code consisting of six to nine digits. Unlike some other identification systems, the number does not encode any specific information about the financial instrument, such as the country of origin or type of security.

Comparison with CUSIP Numbers

While Valoren Numbers and CUSIP Numbers serve similar purposes, there are notable differences:

• CUSIP: Primarily used in the United States and Canada, covering U.S. and Canadian entities and international securities.
• Valoren Number: Specific to Swiss financial instruments.

How Valoren Numbers are Assigned

The assignment of Valoren Numbers is carried out by the SIX Group, which operates the Swiss Stock Exchange and provides various financial information services.

Examples of Valoren Numbers

An example of a Valoren Number for a Swiss stock could be “1234567.” It’s important to note that these numbers are devoid of alphanumeric symbols or embedded meanings.

Applications of Valoren Numbers

Valoren Numbers have several key applications in the financial market:

• Trade Identification: Essential for identifying securities accurately during trades.
• Settlement Processing: Facilitates smooth settlement by ensuring accurate tracking of traded securities.
• Regulatory Compliance: Helps in maintaining proper records for regulatory purposes.

FAQs

What is a Valoren Number?

A Valoren Number is a unique numerical identifier assigned to securities and financial instruments traded within the Swiss financial market.

How are Valoren Numbers different from ISINs?

While both Valoren Numbers and International Securities Identification Numbers (ISINs) are used to identify financial instruments, ISINs are alphanumeric and internationally recognized, covering any country’s securities.

Can Valoren Numbers be used internationally?

Valoren Numbers are primarily used within Switzerland, whereas identification systems like ISIN and CUSIP are used for international transactions.

References

1. SIX Group. (2023). Valoren Number Assignment. Retrieved from SIX Group Official Website
2. International Organization for Standardization. (2023). ISO 6166 International Securities Identification Numbering (ISIN) System.

Summary

Valoren Numbers are crucial for the accurate identification and trading of financial instruments in Switzerland. By providing a unique identifier, these numbers facilitate smooth transactions and regulatory compliance. Although similar to CUSIP numbers used in North America, Valoren Numbers are specific to the Swiss financial market. Understanding the significance and application of Valoren Numbers can greatly enhance the efficiency and reliability of trading activities involving Swiss securities.