On 7 March 2016, the Australian Securities Exchange (ASX) is shortening the trade settlement period for Australian sharemarket trades from three days to two days. This means that your buy and sell trades will settle one business day earlier.
New settlement period from 7 March 2016
The new Settlement Date will be the Trade Date (T) +2 business days. For example, if the order executes on Monday, settlement will take place on Wednesday.
How the change affects you
When the ASX moves from a T+3 to T+2 settlement period, you will need to ensure that for buy trades, cleared funds are available in your settlement account one day earlier on the morning of T+2. You will also receive proceeds from sell trades one day earlier.
Aside from that, there is no need for you to do anything. The change will happen automatically on 7 March 2016.
Why the change?
A shorter settlement cycle means you will have quicker access to your money after selling shares and earlier receipt after purchasing shares. It will also keep Australia aligned with leading settlement practices around the world, such as Europe and Hong Kong, with the United States following suit in 2017.
If you have any questions about this please contact us.
Source: CommSec
