SEDOL

What does SEDOL mean?

The Stock Exchange Daily Official List (SEDOL) is a unique seven-character identification code specifically assigned to securities traded on the London Stock Exchange and several smaller exchanges within the United Kingdom. These SEDOL codes serve as identifiers for various financial instruments, including unit trusts, investment trusts, insurance-linked securities, and domestic and foreign stocks. In essence, SEDOL codes are analogous to CUSIP numbers in the United States, which are codes issued by the Committee on Uniform Securities Identification Procedures for stocks traded in the US.

Upon the request of the security issuer, the London Stock Exchange assigns the seven-digit numbers for SEDOL codes. Starting from January 26, 2004, SEDOL codes have been sequentially issued, incorporating both numbers and letters. The series began with the code "B000009." In the SEDOL format, numbers always precede letters for each character position, and vowels are excluded from the codes. As a result, SEDOL codes issued after January 2004 always commence with a letter, ensuring a systematic and consistent approach to generating unique identifiers for individual securities listed on the London Stock Exchange and other associated markets.

What is the purpose of SEDOL?

SEDOLs function as the National Securities Identifying Number (NSIN) for all securities issued in the United Kingdom. A SEDOL code is a unique identifier, a seven-character alphanumeric code that uniquely identifies securities issued in the United Kingdom’s exchanges and other global multi-asset securities. It is part of the global security identifier and is often used for clearing purposes in cross-border trade.

Consequently, SEDOL codes are an integral component of the security’s International Securities Identifying Number (ISIN) as well. The SEDOL Masterfile (SMF) service contains reference data for millions of global multi-asset securities, each distinguished at the market level by a universal SEDOL code.

Various organizations widely utilize the SEDOL Masterfile, a secure and identifiable method, to facilitate security identification in their business operations. It serves multiple purposes, such as aiding in portfolio valuation, facilitating trade execution, and processing price feeds. Additionally, SEDOL codes are employed for reference data validation, acting as a cross-reference to other identifiers, and validating prices, ensuring accuracy and reliability in financial activities.

Overall, SEDOL codes play a crucial role in the financial world, providing a universally recognized and uniquely identifying alphanumeric code for different securities.

SEDOL vs. ISIN

The acronym SEDOL represents Stock Exchange Daily Official List, while ISIN stands for International Securities Identification Number. These codes serve the essential purpose of providing unique identification for specific securities.

SEDOL is a unique seven-character alphanumeric code assigned to individual securities traded on the London Stock Exchange and some other exchanges in the United Kingdom. It helps in facilitating the trading and settlement of these specific securities. On the other hand, ISIN is a globally recognized and standardized 12-character alphanumeric code that uniquely identifies a specific security issued anywhere in the world. It is used for international identification and tracking of securities, enabling cross-border trading and regulatory compliance.

SEDOL vs. CUSIP

SEDOL is a seven-character alphanumeric code primarily used in the United Kingdom and Ireland to uniquely identify individual securities listed on the London Stock Exchange and other exchanges in these countries. It facilitates trading and settlement within the UK market. On the other hand, CUSIP is a nine-character alphanumeric code used predominantly in the United States and Canada to identify securities traded in these regions. It is assigned by the American Bankers Association (ABA) and provides a standardized method for tracking and settling transactions in the U.S. and Canadian markets.

What is an example of a SEDOL code?

An illustration of an earlier SEDOL code assignment is the HSBC stock with the SEDOL: 0540528, dating back to 1991, consisting solely of numerical values. In contrast, a more recent instance is the Antofagasta bond, 2.375% 14oct2030, USD SEDOL: BMDGCK2. A comparable identification code used for US and Canadian securities is CUSIP.

To verify the accuracy of a reported SEDOL number, traders follow a specific process. They multiply each digit by its assigned weight and then add the results. If the final sum is a multiple of ten, then the SEDOL code is considered correct.

For HSBC’s SEDOL code, the calculation would be as follows:

0 + 5x3 + 4x1 + 0 + 5x3 + 2x9 + 1x8 = 60, which is indeed a multiple of 10. Therefore, the code is verified as correct.