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What Is Settlement?

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Written by Nathaniel O'Dell

After a trade is executed, ownership doesn’t transfer instantly for accounting purposes.

In U.S. markets, stocks generally settle on T+1:

  • T = trade date

  • +1 = one business day later

This means funds or shares become fully settled the next business day.

Important Considerations

Before trading stocks, consider:

  • Your financial goals

  • Your risk tolerance

  • Diversification (not putting all funds into one stock)

  • Fees and taxes

  • Market conditions

If you’re unsure whether stock trading is right for you, consider consulting a licensed financial professional.

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