# Selling shares before settlement date



## naddis01 (23 November 2008)

Basically my question is say I was to buy some shares and the settlement date is for example the 26th of Nov, can I sell them before this date? 

Generally how long does it take for settlement?


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## 50chickens (23 November 2008)

settlement is 3 days i think, but you can sell them at any time before then.


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## cuttlefish (23 November 2008)

Yes. For shares, settlement is 3 days after the transaction (T+3).

If you buy shares tomorrow (24th), then the settlement is the 27th but you can sell the shares before they settle - this is because you also don't need to settle until T+3 - so your purchase will always settle before or at the same time as your sale needs to settle.

Note that for options, settlement is shorter (T+1).


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## naddis01 (24 November 2008)

Thanks guys


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## BugHut (11 August 2009)

A further question in relation to this topic.

I understand the normal T+3 settlement process, but are you allowed to do the following.

Say I buy some shares for $1, and they just happen to be on the rise, and an hour later they are at $1.20. Can I immediately sell them, even though I haven't settled?


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## nunthewiser (11 August 2009)

BugHut said:


> A further question in relation to this topic.
> 
> I understand the normal T+3 settlement process, but are you allowed to do the following.
> 
> Say I buy some shares for $1, and they just happen to be on the rise, and an hour later they are at $1.20. Can I immediately sell them, even though I haven't settled?




yes


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## Aussiest (11 August 2009)

BugHut said:


> A further question in relation to this topic.
> 
> I understand the normal T+3 settlement process, but are you allowed to do the following.
> 
> Say I buy some shares for $1, and they just happen to be on the rise, and an hour later they are at $1.20. Can I immediately sell them, even though I haven't settled?




Yes, and so you should!


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## nunthewiser (11 August 2009)

Aussiest said:


> Yes, and so you should!





Totally agree 20%  an hour beats trembling hands 20% a year by a galaxy ........move over TH your old hat !


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## beamstas (11 August 2009)

So many threads about settlement..
Settlement means nothing to you as a trader


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## Timmy (11 August 2009)

beamstas said:


> So many threads about settlement..
> Settlement means nothing to you as a trader




Be aware that the question comes from a first-time poster, so if you have a comment to add that may be helpful to him or her, please do so.


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## jono1887 (11 August 2009)

you dont really need to worry about settlement... just make sure the money is in the account on the settlement date if you havn't sold it on T or T+1


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## nunthewiser (11 August 2009)

settlement dates certainly matter if one has to cover any shortfalls or trying to calculate when funds are available for transfer/withdrawal 

ignore any off the cuff comments to the OP and fire away with any more you can think of


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## Lydias (11 August 2009)

nunthewiser said:


> settlement dates certainly matter if one has to cover any shortfalls or trying to calculate when funds are available for transfer/withdrawal
> 
> ignore any off the cuff comments to the OP and fire away with any more you can think of




Is it possible to buy $10000 worth of shares and sell it for $9000 in the same day (a loss of $1000) while you only have $5000 in your settlement account?


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## nunthewiser (11 August 2009)

Lydias said:


> Is it possible to buy $10000 worth of shares and sell it for $9000 in the same day (a loss of $1000) while you only have $5000 in your settlement account?




all depends on who one trades with ...... commsec has a policy of t+1 trading ie you can trade with no cash actually there as long as the difference is covered at settlement

etrade you must have funds to cover it b4 you can trade ( not settled but available )

so if with commsec and using borrowed funds ie commsec funds . if you take the 1000 loss and you have 5k sitting there cleared then yes you are covered for settlement 

if the above scenario is with another broker using own cleared funds to purchase in first place then yes you are cleared as the loss comes straight out of the sale with no creditor to repay 

hope this is clear as the more i ramble the muddier it gets


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## Lydias (11 August 2009)

nunthewiser said:


> all depends on who one trades with ...... commsec has a policy of t+1 trading ie you can trade with no cash actually there as long as the difference is covered at settlement
> 
> etrade you must have funds to cover it b4 you can trade ( not settled but available )
> 
> ...




I'm with Commsec. Thanks for explaining, I think i get the idea.


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