Business and Personal Finance Dictionary

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• SETTLEMENT DATE
  
  The settlement date is the date by which a securities transaction must be finalized. Depending on the type of trade, it's either the date when the buyer must pay the broker for securities purchased, or the date by which the seller must deliver the sold securities and receive the proceeds from them. For stocks and bonds, the settlement date is three business days after the trade date, or what's referred to as T+3. For options and government securities, the settlement date is one day, or T+1, after the trade date. In figuring long- and short-term capital gains on your tax return, you use the trade date-the date you buy or sell a security-rather than the settlement date as the date of record.
  
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