Question

Reg T deposit is due no later than ______ (not including + 2 days grace extension).

A) 3 business days after the trade
B) 5 business days after the trade
C) 2 business days after the trade
D) 7 business days after the trade

Answer 1

Regulation T requires that the deposit for a securities transaction must be made no later than two business days after the trade is executed.

Step-by-step explanation:

Under Regulation T, also known as Reg T, the deposit for a securities transaction is due no later than two business days after the trade. This rule is set by the Federal Reserve Board and is meant to regulate the extension of credit by brokers and dealers. Typically, when you purchase securities, the broker must receive your payment within this period, often referred to as T+2 settlement period. This rule helps to ensure the orderly processing of trades and maintains the integrity of the securities market.