LESSON 1.7 · FOUNDATION

Why your trade takes days to settle

Trade date, settlement date, and why the cash doesn't move the instant you do.

FOUNDATIONS4 MIN READ

Clicking buy fixes the price and the trade date — but ownership doesn't legally change hands that instant. Behind the scenes, exchanges, brokers and clearing houses still have to confirm and exchange cash for shares, a process called settlement. That finishes on the settlement date, a set number of business days later.

How many days is the T+ settlement cycle — T+2 means two business days after the trade. As of 2026 that's the standard for most UK and US shares, though regulators have been moving markets toward faster T+1 settlement, so check your broker for the cycle that actually applies to you. Until settlement completes, your cash or shares can show as pending rather than fully yours to move.

Trade date — you click buyT+1, T+2…Settlement date — ownership finalised

The price is locked on day one. The paperwork catches up after.

See a holding's cost basis →

Educational content only. It is not personal financial advice.