From Meme Stocks to Market Reform: The Journey to T+1 Settlement
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Recommendations From the Meme Stock Investigation
May 27-28, 2024, were exciting days for investing in Canada and the U.S., respectively. These were the effective dates for the SEC rule amendments to shorten the standard settlement cycle for most broker-dealer transactions from two business days after the trading day (T+2) to one business day (T+1). This rule applies to transactions in stock, bonds, municipal securities, exchange-traded funds, certain mutual funds and limited partnerships that trade on exchange.
In this article, Audit Analytics further examines how the SEC’s T+1 settlement cycle reform aims to reduce risks in securities transactions, sparked by the 2021 meme stock frenzy.