Consider the following statements:1.India has become the first country to start the T+1 settlement cycle in top listed securities.2.Trade settlement is the process of executing a trade between two parties, where the buyer transfers ownership of the securities, and the seller transfers the funds on the trade execution date.3.Under the T+0 settlement cycle, if investors sell shares, they will get the money in their account instantaneously and the buyers will get the shares in their demat accounts the same day.How many of the above statements are correct?

Q. Consider the following statements:
1.India has become the first country to start the T+1 settlement cycle in top listed securities.
2.Trade settlement is the process of executing a trade between two parties, where the buyer transfers ownership of the securities, and the seller transfers the funds on the trade execution date.
3.Under the T+0 settlement cycle, if investors sell shares, they will get the money in their account instantaneously and the buyers will get the shares in their demat accounts the same day..
How many of the above statements are correct?

[A] Only one

[B] Only two

[C] Only three

[D] None

Answer: A

Notes:

Explanation –

Statements 1 and 2 are incorrect. India became the second country to start the T+1 settlement cycle in top listed securities after China. Trade settlement is the process of completing a securities transaction between two parties, where the buyer transfers funds and the seller transfers ownership of the securities on the agreed-upon settlement date, which is typically a few days after the trade execution date.

Statement 3 is correct. Under the T+0 settlement cycle, if investors sell shares, they will get the money in their account instantaneously and the buyers will get the shares in their demat accounts the same day.

Source: ForumIAS

Post-Mains Strategy Session by Mr. Ayush Sinha | ForumIAS