The Wall Street Journal: Wall Street shortens trading settlement with migration to ‘T+2’

Anybody who sold shares Tuesday is guaranteed to receive cash for their trade by Thursday — a day earlier than any point during the past two decades.

That’s because Tuesday marks the first day that trades in most financial products in the U.S. will be required to “settle” within two business days, rather than in three days as has been in place since 1995.

The settlement process finalizes trades, transferring money from buyers to sellers in exchange for ownership of a security. In industry jargon, Tuesday is the first day of the “T+2″ era, which supplants “T+3.”

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