NISM Certifications · NISM-Series-X-A: Investment Adviser (Level 1) · Securities Market Segments
Mr. Iyer buys 200 shares of an Indian company on the cash segment on a Monday (T day), with a T+1 rolling settlement cycle. On which day will the shares ordinarily be settled (pay-in/pay-out), assuming no holidays intervene?
The trade settles on Tuesday, the next working day. Indian equity cash market trades follow a T+1 rolling settlement cycle, so pay-in and pay-out take place one working day after the trade date, provided no holidays intervene between Monday and Tuesday.
- AMonday, the same day
- BTuesday, the next working dayCorrect
- CWednesday, two working days later
- DThursday, three working days later
Explanation
Equity cash market trades in India settle on a T+1 rolling basis, so a Monday trade settles on Tuesday when there are no holidays. T+2 would give Wednesday, which was the earlier cycle and is no longer applicable. Same-day settlement is not the standard cycle.
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