Hello Community
Sharing a pivotal update here. The SEBI chairperson has announced a significant change that is set to affect the operations of the markets. Starting March 28, SEBI will introduce the T+0 trade settlement cycle on an optional basis.
For those unfamiliar, the Indian stock market currently follows a T+1 settlement cycle for all stocks. This means that trades are settled one day after the transaction is executed. However, with the introduction of T+0, settlements could happen on the same day — offering instant settlement and ensuring trades are finalised immediately.
This is a monumental shift in trading dynamics and opens up new opportunities for traders looking for quicker settlements.
The capital market regulator had proposed to implement instantaneous settlement of trades of T+0 in two phases.In phase 1, the regulator will begin with implementing an optional T+0 settlement cycle (for trades till 1:30 PM), with the settlement of funds and securities to be completed on the same day by 4:30 PM. In phase 2, an optional immediate trade-by-trade settlement (funds and securities) may be carried out. In the second phase, trading will be carried out till 3.30 pm.
Few things I can think of that will be helpful for the traders/investors are :
- Same day margin release of stocks sold from the portfolio.
- Balance money eligible for withdrawal.
- Complexity of delivery shortage & auctions are reduced
Let us know below how T+0 settlement is going to affect you.
-Naman