Series 7 practice questioneasyTrade Settlement — Regular Way
What is the regular way settlement period for corporate stocks and bonds?
- AT+0 (same day)
- BT+2 (two business days after trade date)
- CT+1 (one business day after trade date)✓ Correct answer
- DT+3 (three business days after trade date)
Explanation
Why C — T+1 (one business day after trade date)
As of May 2024, the regular way settlement for most securities, including corporate stocks and bonds, is T+1, meaning one business day after the trade date. This was shortened from T+2 under SEC Rule 15c6-1 to reduce counterparty risk and improve market efficiency. The shortened settlement cycle requires firms to have efficient post-trade processing systems in place.
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