When-, As- and If-Issued Securities

What this video covers

• What when-issued (WI) securities are and why they trade on a "when, as, and if issued" basis before the security legally exists
• Why the holding period begins on the trade date (technically the day after), not on the issuance or settlement date
• How cost basis is permanently locked in at the price agreed during the when-issued transaction
• Why when-issued trades settle on the issuance date instead of the standard trade date plus one business day (T+1) cycle
• The capital-gains trap: how counting from the trade date can shift a sale from short-term ordinary income treatment to long-term capital gains
• The classic exam bait of offering T+1 as an answer choice on a when-issued scenario
• How to map a when-issued timeline from trade date, to issuance, to sale, and pick the correct tax treatment