Settling before T+3?
It is possible but unlikely. Securities firms would prefer never to settle externally; rather, they prefer to wait until the liabilities can be netted.  They are forced to make and take payment in three business days. The reason why is because settlement is costly in the same way as any other business would prefer to build trade credit instead of taking or making payment rapidly. The only circumstance where a financial firm would wish to take full delivery is when a counterparty is no longer trusted to be solvent. The T+3 settlement date only affects cash accounts.  In a cash account, you need to wait until the T+3 settlement date for your funds to be available to make your next trade.  But if you convert your cash account into a margin account, then you do not need to wait until the T+3 settlement date for your next trade - your broker will allow you to make another trade immediately.
"The T+3 ""rule"" relates only to accounting and not to trading.  It does not prevent you from day trading.  It simply means that the postings in you cash account will not appear until three business days after you have executed a trade.  When you execute a trade and the order has been filled, you have all of the information you need to know the cash amounts that will hit your account three business days later. In a cash account, cash postings that arise from trading are treated as unsettled (for three days), but this does not mean that these funds are available for further trading.  If you have $25,000 in your account on day 1, this does not mean that you will be able to trade more than $25,000 because your cash account has not yet been debited.  Most cash accounts will include an item detailing ""Cash available for trading"".  This will net out any unsettled business transacted. For example, if you have a cash account balance of $25,000 on day one, and on the same day you purchase $10,000 worth of shares, then pending settlement in your cash account you will only have $15,000 ""Cash available for trading"". Similarly, if you have a cash balance of $25,000 on day one, and on the same day you ""day trade"", purchasing $15,000 and selling $10,000 worth of shares, then you will have the net of $20,000 ""Cash available for trading"" ($20,000 = $25,000 - $15,000 + $10,000). If by ""prop account"" you mean an account where you give discretion to a broker to trade on your behalf, then I think the issues of accounting will be the least of your worries.  You will need to be worried about not being fleeced out of your hard earned savings by someone far more interested in lining their own pockets than making money for you." I would use neither method.  Taking a short example first, with just three compounding periods, with interest rate 10%.  The start value y0 is 1. So after three years the value is 1.331, the same as y0 (1 + 0.1)^3. Depreciating (like inflation) by 10% (to demonstrate) gets us back to y0 = 1 Appreciating and depreciating by 10% cancels out: Appreciating by 10% interest and depreciating by 3% inflation: This is the same as y0 (1 + 0.1)^3 (1 + 0.03)^-3 = 1.21805 So for 50 years the result is y0 (1 + 0.1)^50 (1 + 0.03)^-50 = 26.7777 Note You can of course use subtraction but the not using the inflation figure directly.  E.g. (edit: This appears to be the Fisher equation.) 2nd Note Further to comments, here is a chart to illustrate how much the relative performance improves when inflation is accounted for.  The first fund's return is 6% and the second fund's return varies from 3% to 6%.  Inflation is 3%. If you look at history, it shows that the more people predict corrections the less was the chance they came. That doesn't prove it stays so, though. 2017 is not any different than other years in the future: Independent of this, with less than ten years remaining until you need to draw from your money, it is a good idea to move away from high risk (and high gain); you will not have enough time to recover if it goes awry. There are different approaches, but you should slowly and continuously migrate your capital to less risky investments. Pick some good days and move 10% or 20% each time to low-risk, so that towards the end of the remaining time 90 or 100% are low or zero risk investments. Many investment banks and retirement funds offer dedicated funds for that, they are called 'Retirement 2020' or 'Retirement 2030'; they do exactly this 'slow and continuous moving over' for you; just pick the right one. "Depends on your account. If you have a margin account, then you can ""withdraw"" the margin, and it will get paid off/settled on T+3. However if it's a cash account then you will most likely need to wait. Call your broker and ask, each broker has different rules." "TLDR:  Why can't banks give me my money? We don't have your money. Who has my money? About half a dozen different people all over the world. And we need to coordinate with them and their banks to get you your money. I love how everyone seems to think that the securities industry has super powers.  Believe me, even with T+3, you won't believe how many trades fail to settle properly.  Yes, your trade is pretty simple. But Cash Equity trades in general can be very complicated (for the layman).  Your sell order will have been pushed onto an algorithmic platform, aggregated with other sell order, and crossed with internal buy orders. The surplus would then be split out by the algo to try and get the best price based on ""orders"" on the market.  Finally the ""fills"" are used in settlement, which could potentially have been filled in multiple trades against multiple counterparties. In order to guarantee that the money can be in your account, we need 3 days. Also remember, we aren't JUST looking at your transaction. Each bank is looking to square off all the different trades between all their counter parties over a single day. Thousands of transactions/fills may have to be processed just for a single name. Finally because, there a many many transactions that do not settle automatically, our settlements team needs to co-ordinate with the other bank to make sure that you get your money. Bear in mind, banks being banks, we are working with systems that are older than I am. *And all of the above is the ""simplest"" case, I haven't even factored in Dark Pools/Block trades, auctions, pre/post-market trading sessions, Foreign Exchange, Derivatives, KYC/AML." "Depositum irregulare is a Latin phrase that simply means ""irregular deposit."" It's a concept from ancient Roman contract law that has a very narrow scope and doesn't actually apply to your example. There are two distinct parts to this concept, one dealing with the notion of a deposit and the other with the notion of irregularity. I'll address them both in turn since they're both relevant to the tax issue. I also think that this is an example of the XY problem, since your proposed solution (""give my money to a friend for safekeeping"") isn't the right solution to your actual problem (""how can I keep my money safe""). The currency issue is a complication, but it doesn't change the fact that what you're proposing probably isn't a good solution. The key word in my definition of depositum irregulare is ""contract"". You don't mention a legally binding contract between you and your friend; an oral contract doesn't qualify because in the event of a breach, it's difficult to enforce the agreement. Legally, there isn't any proof of an oral agreement, and emotionally, taking your friend to court might cost you your friendship. I'm not a lawyer, but I would guess that the absence of a contract implies that even though in the eyes of you and your friend, you're giving him the money for ""safekeeping,"" in the eyes of the law, you're simply giving it to him. In the US, you would owe gift taxes on these funds if they're higher than a certain amount. In other words, this isn't really a deposit. It's not like a security deposit, in which the money may be held as collateral in exchange for a service, e.g. not trashing your apartment, or a financial deposit, where the money is held in a regulated financial institution like a bank. This isn't a solution to the problem of keeping your money safe because the lack of a contract means you incur additional risk in the form of legal risk that isn't present in the context of actual deposits. Also, if you don't have an account in the right currency, but your friend does, how are you planning for him to store the money anyway? If you convert your money into his currency, you take on exchange rate risk (unless you hedge, which is another complication). If you don't convert it and simply leave it in his safe, house, car boot, etc. you're still taking on risk because the funds aren't insured in the event of loss.  Furthermore, the money isn't necessarily ""safe"" with your friend even if you ignore all the risks above. Without a written contract, you have little recourse if a) your friend decides to spend the money and not return it, b) your friend runs into financial trouble and creditors make claim to his assets, or c) you get into financial trouble and creditors make claims to your assets. The idea of giving money to another individual for safekeeping during bankruptcy has been tested in US courts and ruled invalid. If you do decide to go ahead with a contract and you do want your money back from your friend eventually, you're in essence loaning him money, and this is a different situation with its own complications. Look at this question and this question before loaning money to a friend. Although this does apply to your situation, it's mostly irrelevant because the ""irregular"" part of the concept of ""irregular deposit"" is a standard feature of currencies and other legal tender. It's part of the fungibility of modern currencies and doesn't have anything to do with taxes if you're only giving your friend physical currency. If you're giving him property, other assets, etc. for ""safekeeping"" it's a different issue entirely, but it's still probably going to be considered a gift or a loan. You're basically correct about what depositum irregulare means, but I think you're overestimating its reach in modern law. In Roman times, it simply refers to a contract in which two parties made an agreement for the depositor to deposit money or goods with the depositee and ""withdraw"" equivalent money or goods sometime in the future. Although this is a feature of the modern deposit banking system, it's one small part alongside contract law, deposit insurance, etc. These other parts add complexity, but they also add security and risk mitigation. Your arrangement with your friend is much simpler, but also much riskier.  And yes, there probably are taxes on what you're proposing because you're basically giving or loaning the money to your friend. Even if you say it's not a loan or a gift, the law may still see it that way. The absence of a contract makes this especially important, because you don't have anything speaking in your favor in the event of a legal dispute besides ""what you meant the money to be."" Furthermore, the money isn't necessarily safe with your friend, and the absence of a contract exacerbates this issue. If you want to keep your money safe, keep it in an account that's covered by deposit insurance. If you don't have an account in that currency, either a) talk to a lawyer who specializes in situation like this and work out a contract, or b) open an account with that currency. As I've stated, I'm not a lawyer, so none of the above should be interpreted as legal advice. That being said, I'll reiterate again that the concept of depositum irregulare is a concept from ancient Roman law. Trying to apply it within a modern legal system without a contract is a potential recipe for disaster. If you need a legal solution to this problem (not that you do; I think what you're looking for is a bank), talk to a lawyer who understands modern law, since ancient Roman law isn't applicable to and won't pass muster in a modern-day court." "The definition you cite is correct, but obscure. I prefer a forward looking definition. Consider the real investment. You make an original investment at some point in time. You make a series of further deposits and withdrawals at specified times.  At some point after the last deposit/withdrawal, (the ""end"") the cash value of the investment is determined. Now, find a bank account that pays interest compounded daily. Possibly it should allow overdrafts where it charges the same interest rate. Make deposits and withdrawals to/from this account that match the investment payments in amount and date.  At the ""end"" the value in this bank account is the same as the investment. The bank interest rate that makes this happen is the IRR for the investment..." "The settlement date for any trade is the date on which the seller gets the buyer's money and the buyer gets the seller's product.  In US equities markets the settlement date is (almost universally) three trading days after the trade date.  This settlement period gives the exchanges, the clearing houses, and the brokers time to figure out how many shares and how many dollars need to actually be moved around in order to give everyone what they're owed (and then to actually do all that moving around). So, ""settling"" a short trade is the same thing as settling any other trade.  It has nothing to do with ""closing"" (or covering) the seller's short position. Q: Is this referring to when a short is initiated, or closed? A: Initiated.  If you initiate a short position by selling borrowed shares on day 1, then settlement occurs on day 4.  (Regardless of whether your short position is still open or has been closed.) Q: All open shorts which are still open by the settlement date have to be reported by the due date. A: Not exactly.  The requirement is that all short positions evaluated based on their settlement dates (rather than their trade dates) still open on the deadline have to be reported by the due date. You sell short 100 AAPL on day 1.  You then cover that short by buying 100 AAPL on day 2. As far as the clearing houses and brokers are concerned, however, you don't even get into the short position until your sell settles at the end of day 4, and you finally get out of your short position (in their eyes) when your buy settles at the end of day 5. So imagine the following scenarios: The NASDAQ deadline happens to be the end of day 2.  Since your (FINRA member) broker has been told to report based on settlement date, it would report no open position for you in AAPL even though you executed a trade to sell on day 1. The NASDAQ deadline happens to be the end of day 3.  Your sell still has not settled, so there's still no open position to report for you. The NASDAQ deadline happens to be the end of day 4.  Your sell has settled but your buy has not, so the broker reports a 100 share open short position for you. The NASDAQ deadline happens to be the end of day 5.  Your sell and buy have both settled, so the broker once again has no open position to report for you. So, the point is that when dealing with settlement dates you just pretend the world is 3 days behind where it actually is." "JoeTaxpayer nailed it.  Here's another way to look at it: Generally, we invest in something, then might leave it there for a few years, then take it out, but don't touch it in between.  In that case, to get the final amount X(N), we need to take the initial amount, then multiply by growth in the first year, then multiply by growth in the second year, etc. So, for three years, we have: X(3) = X(0) * G(1) * G(2) * G(3) = X(0) * ""average annual growth"" ^ 3 So, here, we see that we want the average annual growth to the power three equal to the product of the annual growth rates, thus, geometric mean: geometric mean = (G(1) * G(2) * G(3)) ^ (1/3) On the other hand, consider a situation where I have three investments X,Y,Z over one year. Now I have, after one year: X(1)+Y(1)+Z(1) = X(0)*G(1,X) + Y(0)*G(1,Y) + Z(0)*G(1,Z) = ( X(0)+Y(0)+Z(0) ) * ""average annual growth"" Now, in this case, if we assume X(0) = Y(0) = Z(0) = 1, i.e. I put equal amounts in each, we see that the average annual growth rate we want in this case is the arithmetic mean: arithmetic mean = (G(1,X) + G(1,Y) + G(1,Z)) / 3 (if we had unequal amounts at the beginning, it would be a weighted average). TL;DR:" "This is the best tl;dr I could make, [original](https://www.princeton.edu/rpds/events_archive/repository/Naidu040313/Flood_HN_Jan2013.pdf) reduced by 99%. (I'm a bot) ***** &gt; Outcome Y in county c and year t is regressed on the fraction of county land ﬂooded in 1927, state-by-year ﬁxed eﬀects, and county ﬁxed eﬀects: Yct = &amp;beta;t F ractionF loodc + &amp;alpha;st + &amp;alpha;c + ct Note that  is allowed to vary by year, so each estimated  is interpreted as the average diﬀerence between ﬂooded counties and non-ﬂooded counties in that year relative to the omitted base year of 1925 or 1920.  &gt; 53 In a modiﬁed version of equation, the fraction of county ﬂooded is interacted with a dummy variable for whether the county is a &amp;quot;plantation county&amp;quot; and a dummy variable for whether the county is a &amp;quot;nonplantation county.  &gt; Column reports the within-state difference for each county characteristic by the fraction of the county flooded in 1927: the coefficients are estimated by regressing the indicated county characteristic on the fraction of the county flooded in 1927 and a state fixed effect, weighting by county size.   ***** [**Extended Summary**](http://np.reddit.com/r/autotldr/comments/6q2327/when_the_levee_breaks_black_migration_and/) | [FAQ](http://np.reddit.com/r/autotldr/comments/31b9fm/faq_autotldr_bot/ ""Version 1.65, ~177559 tl;drs so far."") | [Feedback](http://np.reddit.com/message/compose?to=%23autotldr ""PM's and comments are monitored, constructive feedback is welcome."") | *Top* *keywords*: **county**^#1 **ood**^#2 **Black**^#3 **agricultural**^#4 **estimate**^#5" Think of it this way: C + (-P) = forward contract. Work it out from there. Anyways, this stack is meant for professionals, not students, I think. TWRR = (2012Q4 x 2013Q1 x 2013Q2) ^ (1/3) = ?? (1.1 * .809 * 1.29) ^ (1/3) = 1.047 or 4.7% return. No imaginary numbers needed.  But. Your second line there is wrong $15,750 - $15,000 - $4,000 ? The $15K already contains the $4k, why did you subtract it again?  This a homework problem? Not directly an answer to your question, but somewhat related: There are derivatives (whose English name I sadly don't know) that allow to profit from breaking through an upper or alternatively a lower barrier. If the trade range does not hit either barrier you lose. This kind of derivative is useful if you expect a strong movement in either direction, which typically occurs at high volume. "Curious if anyone has any insight here, but isn't it too soon to tell if this will lead to inflation, and purely speculative that we could ""do the same"", given that we are in a very different set of circumstances?" I think the answer to this must differ from country to country.  I have lived in several countries where the normal everyday way of making a payment is to instruct my bank to transfer the money to the recipient's account.  Of course this means I must know his name, SC and account number – but this is an accepted part of the system; businesses routinely display that information on invoices and correspondence.  It is simply not regarded as confidential. DumbCoder's comment suggests that if he has that information he can take money from my account without my permission – in other words, my bank will pay money out of my account on someone else's request, without my authority.  Is this correct?  In which country or countries can this happen?   (I must go there quickly and begin stealing people's money.)