0
From FINRA's website, "Regulation T..... requires full cash payment for the purchase of any security in a cash account without relying upon the anticipated proceeds of any unsettled trade in the account."
This means you have to have cash to cover the cost of your newly purchased stocks at by the settlement date.
Settlement of funds is T+3 (Trade date +3 Business Days).
One might infer that you would have to wait 3 days after selling one stock before you could take a position in another stock.
In reality, this is not the case because the funds from the first sale settle while you are in the second position.
Example (Hypothetical Scenario):
Monday Morning, I buy HPQ expecting to hold it for the rest of my life.
Tuesday Morning, they release awesome printer news before the bell, the stock price skyrockets and I sell for a tidy profit.
Settlement is T+3
T+3=Tuesday (Trade Date) +Wednesday, Thursday, and Friday. That is when the Funds from this sale will be settled.
I realize the printer news should increase sales for a paper company (Teldar, no Wausau Paper Corp.-WPP) and I buy WPP on Tuesday.
To avoid a Reg. T violation, I have to wait until Friday before I close out my WPP position or make a deposit that covers the buy of WPP before Friday.
Technically, you can buy XYZ, sell XYZ, and buy ABC all on the same day, but you can't sell ABC until 3 additional Business Days later.
What else can I help you with?
Is there a difference between a parking violation and a ticket?
A parking violation is the act of breaking the law or regulation. A Ticket is notice of the violation.
What is reg T violation?
Unsettled funds
What violation is entering into an unauthorized contract and or providing insider information to a contractor is?
Joint ethics regulation violations
What is a civil conviction?
Civil Conviction - a finding of guilt to a violation of a rule, regulation or law outside a criminal court
How long does the Department of Defense Financial Management Regulation give an individual discovering a possible Antideficiency Act violation to report the violation?
The Department of Defense Financial Management Regulation requires individuals who discover a possible Antideficiency Act violation to report it within 10 days of becoming aware of the violation. This prompt reporting is essential for ensuring accountability and compliance with financial management regulations. Delays in reporting can complicate the resolution process and increase potential liabilities.
What is C-T-R?
common technical regulation
What is the payment requirement for customers in a margin account according to Regulation T?
The payment requirement for customers in a margin account according to Regulation T is a minimum of 50 of the purchase price of securities bought on margin.
Is lofting a violation of duck pin bowling rules and regulation?
yes. it creates bumps on the surface of the lanes which affect the roll of a bowling ball.
Rules and regulation of swimming?
don`t swim beside a magic octopus
What is the violation or sanction imposed if employee overslept and missed his duty?
he has to eat sh!t
How long does the Department of Defense Financial Management Regulation give an individual discovering a possible Antideficiency Act violation to report it to hisher chain of command and the Financial?
a
What violation is 1180-B?
Violation 1180-B refers to a specific traffic regulation in New York State that prohibits the use of handheld electronic devices while operating a motor vehicle. This includes actions such as texting, browsing the internet, or using apps. The law aims to enhance road safety by reducing distractions for drivers. Violating this regulation can result in fines and points on a driver's license.
