Final answer:
The regular-way settlement for a municipal securities transaction occurs 2 business days after the trade date. This allows time for confirmation and reconciliation. US government securities settle on the next business day. The correct option is b. 2 business days
Step-by-step explanation:
The regular-way settlement for a municipal securities transaction occurs 2 business days after the trade date. This means that when a trade is executed, the settlement, which involves the exchange of money and securities, takes place two business days after the trade date. This allows time for the parties involved to confirm and reconcile the details of the transaction.
For example, if a trade is executed on Monday, the settlement will occur on Wednesday. However, if the trade is executed on a non-business day, such as a weekend or holiday, the settlement will be pushed to the next available business day.
In contrast, certain securities, such as US government securities, have different settlement periods. US government securities settle on the next business day after the trade date, while equity securities typically settle on the same business day or T+0 (trade date plus zero days). The correct option is b. 2 business days