Clearance and Settlement: Rapid Fire
Chapters in this video
- 0:00 Customer confirmations and FINRA additions
- 0:28 Settlement ceilings and delivery dates
- 1:30 Early tenders and purchaser rejection
- 2:23 Fails, buy-ins, and sell-outs
- 4:39 Buy-in deadlines and stay extensions
- 5:21 Dividend ex-dates and exceptions
- 6:20 Options Clearing Corporation assignments
- 6:44 Rapid-fire settlement recap
What this video covers
- When a customer confirmation must be sent, why a broker or dealer is excluded from the Securities and Exchange Commission definition of customer, and what the Financial Industry Regulatory Authority (FINRA) adds to confirmations
- How the settlement-cycle rule acts as a ceiling, not a fixed day, including cash, regular-way, and buyer's or seller's options delivery under the Uniform Practice Code
- Why an early regular-way tender is only an offer that the purchaser may reject without prejudice
- Why a failed delivery does not cancel the contract, and how the buyer's buy-in differs from the seller's sell-out
- The buy-in timeline: no sooner than the third business day after delivery was due, notice by 12:00 noon Eastern Time, rejection by 6:00 p.m., and delivery by 3:00 p.m.
- How stays, securities in transit, cash contracts, and guaranteed-delivery contracts change the normal buy-in process
- How dividend and distribution size determines the ex-date, plus the American Depositary Receipt, foreign-security, and Options Clearing Corporation exceptions
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