What is settlement?

Settlement is the behind-the-scenes operations process through which buys and sells for stocks are fulfilled.

Due to the complexities of this process, many UK stock orders will typically settle 2 working days after they were made (AKA T+2) and US stock orders typically after 3 working days (AKA T+3). US stocks settle T+2 in the market, however, due to the conversion deadlines the cash is settled T+3.

To an end customer, settlement doesn't have that much of an impact. Once your order has been completed with a broker, you’ve made a legal contract and the order will be fulfilled at the price you saw.

That's why if you execute a sell order, the proceeds will go into your available cash as 'unsettled cash'. This can be re-invested in the Freetrade app as soon as you like.

However, until the cash settles approximately 2 or 3 business days later, you can't withdraw the cash into your bank account. When the sale settles, the money will leave 'unsettled cash' and go into your 'withdrawable cash'.