It's Settled

You know what’s better than Stonk Enjoyer on Wednesday?

Stock Enjoyer in your inbox on a Friday.

Seriously sorry to all who were expecting to receive Stonk Enjoyer this Wednesday… I had to be a compliance guru this week and had some major delays.

This is not investment advice and is intended for entertainment purposes only.

It’s Settled

Picture this:

Flushed with newly acquired cash from a recent equity sale, you log in to your brokerage account turning up the volume on that Taylor Swift song you swear you don’t like and prepare to deploy the reallocation strategy you’ve had in your back pocket for the last month.

Finally ready to place that buy order on a ticker you’re bullish on, you go to place the trade.

You look at your brokerage cash and it’s full of life from the recent position you closed out of. Alas, when you're plugging the details into the terminal, you notice your buying power is a measly $6.56.

Ah yes.

Suddenly you remember that it was a holiday weekend and you sold on a Friday and to make a long mother-slicking story short, you have to wait another market day to place that trade.

It’s not a big deal if you’re not a day trader where timing is imperative, but how are we so advanced in so many ways when it comes to trading you’re still waiting for your money for what feels like 5 days at a time during #theholidays.

T+2 has been around since 2017. Before that it was T+3… back when you still called up your broker on the phone and verbally described and instructed the trade you desired to make.

“Ring ring ring!”

“This is T+2. Who is this?”

“The stock market in 2024 calling to tell you it’s time to get with the times!”

Asked & Answered

During the GameStop ~situation~ in 2021, there was a lot of chatter from certain somewhat controversial key players in the retail trading place.

The reason is that the extreme influx in trade volume around $GME (Gamestop) led to some… “issues”… for many brokerage firms and had to have trading halted.

I won’t get too deep into this as it’s a story for another time… but it truly was one of the wildest times of my career.

Well, flash forward to the future, May 28th, 2024, when FINRA mandates that T+2 settlement be changed to T+1. The SEC announced they would shorten settlement in February of 2023… but now it’s becoming fr fr.

BTW…

T+1 means you get your funds or stocks settled in your brokerage account after a trade on the trade date plus one market open day.

*Shook

Or not actually shook…

FINRA, or the Financial Industry Regulatory Authority made changes similar to this one before. Up until 2017, it took 3 days past your trade date for your funds or shares to settle when transacting on the stock market.

So it’s official:

“Beginning on May 28, 2024, the new standard for settlement will become the next business day after a trade, or T+1.”

-FINRA

Weekly Tidbits

• Department of Tortured Poets: Taylor Swift dropped not one, but two albums. One song specifically calls out beef for Kim Kardashian. Okay, nice back to real life now.

• Sanctions: The United States responded to Iran’s drone attacks on Israel with some new sanctions.

• You’re a Rich Boy: Zuck passes Elon in becoming the third-richest person in the world.

Meme of the Week