6.8  Trade Settlement

An investor with a cash account must pay for any securities she purchased by the regular way settlement date, which is the second business day after the trade date for stocks and corporate bonds. We sometimes see this referred to as T + 2, for trade date plus two business days. The regular way settlement date for U.S. Treasuries and options is one business day after the trade date, abbreviated as T + 1. Sellers must deliver the securities by the settlement date as well.