|
|
Rolling settlement |
|
|
|
 Home Site Map Add Term Search About Us Contributors |
Rolling settlementSettlement is the process by which investors pay for shares they have bought and receive payment for shares they have sold. Before July 1994, this process was done by means of an 'account period', normally ten working days. All the transactions during that period were balanced against each other to produce a single figure, which was either paid to the investor or due from him, depending on whether the value of his purchases was higher or lower than the value of his sales in the period. One of the features of the account period was that transactions taking place at the beginning of it (say, Day 1) didn't have to be settled until about 14 days later, whereas transactions at the end (say Day 10) had to be settled within 4 days.In July 1994, the account period system was replaced by ten day (T+10) rolling settlement, which means that each transaction has to be settled ten days after the transaction date. This was subsequently reduced to five days (T+5) and in February 2001 was reduced to three days (T+3).These significance of rolling settlement and of shortened settlement times is that when investors sell shares, the proceeds get paid into their account quicker, and when they buy shares they have to pay for them quicker. It requires careful money management on the part of the investor.Similar MatchesSettlement priceSettlement priceA figure determined by the closing range that is used to calculate gains and losses in futures market accounts. Settlement prices are used to determine gains, losses, margin calls, and invoice prices for deliveries. Related: Closing range. Bank for International Settlements (BIS)Bank for International Settlements (BIS)An international bank headquartered in Basel, Switzerland, which serves as a forum for monetary cooperation among several European central banks, the Bank of Japan, and the US Federal Reserve System. Founded in 1930 to handle the German payment of World War I reparations, it now monitors and collects data on international banking activity and promulgates rules concerning international bank regulation. SettlementSettlementWhen payment is made for a trade. Short settlementShort settlementTrade settlement made prior to the standard five-day period due to customer request. Dispute settlement mechanismDispute settlement mechanismThe procedure by which the WTO settles disputes among members, primarily by means of a three-person panel that hears the case and issues a report, subject to review by the Appellate Body. Further Suggestionssettlement optionsGood delivery and settlement procedures settlement Exchange Delivery Settlement Price Cash settlement contracts Immediate settlement Continuous net settlement (CNS) cash settlement Settlement rate Cash Settlement Bank for International Settlements Same Day Funds Settlement (SDFS) Dispute settlement settlement day Cash sale or settlement Settlement options Real Estate Settlement Procedures Act (RESPA) Exercise settlement amount Insurance settlement Regular way settlement Regular settlement Uniform Settlement Statement Skip day settlement Settlement risk Dispute Settlement Body |
|
|
|