SIE practice questionhardExercise/Assignment
When an option is exercised, how soon must settlement occur?
- AWithin two business days (T+2)✓ Correct answer
- BImmediately
- CWithin one business day (T+1)
- DAt the end of the expiration week
Explanation
Why A — Within two business days (T+2)
Option exercises generally settle on T+2, aligning with equity settlement cycles. The other options do not reflect current standard settlement.
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