Selling Stocks Takes Longer Than I Thought

It has taken 1 week from the time I sold my stocks to when the money arrived in my account. Though the holiday last week added a day to the transaction it’s interesting that it takes so long to move money around.

One week ago I put a sell order on some stocks. That transaction went through in seconds and was immediately reflected in my online statements. So I put in a money transfer request to move money into my bank account. But the next day the money wasn’t there. The transfer was rejected.

In Canada there is a 3 day settlement period for stock transfers. That allows the buyer to show up with the money and the seller to hand over the certificates. Until that settlement period passes the cash in my broker account is held – I guess just in case the buyer of my stock doesn’t have the money to pay.

Add another day because the broker only transfers money at the end of day and there’s a 4 business day wait to get money converted from stocks to cash in my bank account.

It’s interesting that with all the automation in place these transfers aren’t immediate.