WASHINGTON, November 7, 2013 – For stock, bond, and futures traders, “partial” holidays like Veterans Day can be a little confusing. By “partial,” we mean those holidays, like Veterans Day and Columbus Day, where Federal employees, banks, and some state employees can expect the day off while most private sector workers cannot. This dichotomy is reflected on Wall Street where the rules can always get a bit tricky.
When banks are closed—which they will be this coming Veterans Day, which happens on Monday, November 11—bonds generally don’t trade either, so bond traders and bond trading will also have the day off.
On the other hand, stock markets will be open for trading during normal business hours. That said, whether you’re dealing with stocks or bonds, November 11 is not a “settlement” day.
For those unfamiliar with the concept, if you buy, say, 100 shares of IBM today, you’d normally need to be sure the money to settle the trade was in your account by Tuesday, November 12, since “regular way” stock settlement occurs three business days after the trade, including the trade date itself. But actually, your IBM trade, placed today, won’t settle until November 13, since Veterans Day is also not a settlement day.
Same goes for selling those 100 shares of IBM. If you sell today and need the funds for whatever purpose, they won’t be available for you until November 13 due to the holiday. Bonds have a shorter settlement span, but the same situation applies: no Monday settlement due to Veterans Day.
Canada has a parallel holiday on the 11th, known as Remembrance Day, so trading rules are similar to those here, i.e., no settlement day on Monday.
Other investment products like mutual funds may have slightly different rules, so be sure to check with your broker if you have any questions.
Read more of Terry’s news and reviews at Curtain Up! in the Entertain Us neighborhood of the Washington Times Communities. For Terry’s investing and political insights, visit his Communities columns, The Prudent Man and Morning Market Maven, in Business.
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