Settlement Holiday in Stock Market: Meaning

Settlement Holiday is when the stock market is open, but shares which you bought or sold are not settled.

This could be due to bank holidays or because the depositories (CDSL and NDSL) are closed.

Let’s take an example.

18th February 2021: You buy 10 shares of Reliance Industries.

When you purchase shares, you buy it from someone who has sold it. So the shares have to be transferred from their dematerialized (demat) account to yours.

This process takes two working days. In other words, it takes two working days for the Reliance shares to transfer from their demat account to yours.

The day after you buy the shares, Reliance Industries will be shown as T+1. This means, ‘Trading Day + 1’ i.e. the first day after you bought the shares.

On the 2nd day, which is T+2, the shares are deposited into your demat account – after which, you can sell your shares.

However, if there is a ‘settlement holiday’ in between, then it takes one extra working day for the shares to get deposited in your demat account.

Getting back to our example:

  • 18th February (Thursday): You buy 10 shares of Reliance Industries.
  • 19th February (Friday): Settlement holiday due to ‘Chhatrapati Shivaji Maharaj Jayanti’.
  • 20th February (Saturday): Holiday
  • 21st February (Sunday): Holiday
  • 22nd February (Monday): T+1
  • 23rd February (Tuesday): T+2 Reliance shares deposited in your account.

In short, if 19th Feb was not a settlement holiday, you would have received the shares in your demat account by 22nd February.

Saturday and Sunday are always settlement holidays.

List of Settlement Holidays in 2021

Republic Day26 Jan 2021Tuesday
Chhatrapati Shivaji Maharaj Jayanti19 Feb 2021Friday
Mahashivratri11 Mar 2021Thursday
Holi29 Mar 2021Monday
Annual Bank Closing1 Apr 2021Thursday
Good Friday2 Apr 2021Friday
Gudi Padwa13 Apr 2021Tuesday
Ambedkar Jayanti14 Apr 2021Wednesday
Ram Navami21 Apr 2021Wednesday
Id-Ul-Fitr (Ramzan Id)13 May 2021Thursday
Buddha Pournima26 May 2021Wednesday
Bakri Id21 Jul 2021Wednesday
Parsi New Year16 Aug 2021Monday
Muharram19 Aug 2021Thursday
Ganesh Chaturthi10 Sep 2021Friday
Dussehra15 Oct 2021Friday
Id-E-Milad19 Oct 2021Tuesday
Diwali Laxmi Pujan4 Nov 2021Thursday
Diwali Balipratipada5 Nov 2021Friday
Gurunanak Jayanti19 Nov 2021Friday
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