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Share Trading & Settlement

Discussion in 'Shares' started by potter07, 1st Feb, 2008.

  1. potter07

    potter07 Member

    Joined:
    21st Sep, 2007
    Posts:
    12
    Location:
    Melbourne
    Hi guys,

    A quick, very simple query.

    When I execute a trade, it takes three days to settle. Given I now would like to do very quick buy and sells, can I buy a stock early one day, and on the same day/next day sell? Or do I have to wait until settlement, ie legal execution, then sell?

    Cheers, I appreciate your responses.
     
  2. samaka

    samaka Well-Known Member

    Joined:
    30th Sep, 2007
    Posts:
    308
    Location:
    Sydney
    No you can do it straight away. Brokers will even take out the difference on the settlement. If you buy $3000 worth and sell for $3500 - they'll just pay you $500.
     
  3. potter07

    potter07 Member

    Joined:
    21st Sep, 2007
    Posts:
    12
    Location:
    Melbourne
    Thanks samaka.

    So essentially, if I buy $10,000 of a stock on any given day, and then sell for $10,500 later that day, the settlement will happen both ways, and in 3 days $10,500 will be back into my nominated account?
     
  4. samaka

    samaka Well-Known Member

    Joined:
    30th Sep, 2007
    Posts:
    308
    Location:
    Sydney
    Yes - I assume you mean the original $10,000 will stay there - and you get $500.