It stands for delivery versus delivery; a securities settlement mechanism which links two securities transfers in such a way as to ensure delivery takes place against delivery- that is, the delivery of a given security occurs if – and only if – the other security in the other transfer is delivered.

In essence, a delivery versus delivery transaction is the exchange of two securities positions (for whatever purpose, e.g. exchange offers, corporate actions, substitutions of collateral – hence not necessarily a transfer of ownership), whereby the execution of either delivery depends on the other (corresponding) delivery. In which sense, such a transaction is perceived ass two linked free of payment (FOP) transactions, being dependent (contingent) on each other.