What is T1 in holdings?

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If you're an investor then you must have seen the T1 symbol like the above image in your holdings.
When I was working with Zerodha, I used to get queries like "Sir what is T1 in my holdings".

Most new investors get confused with this T1 thing and sometimes some intraday traders also get confused when they convert the intraday position to delivery so the confusion arises when they see the T1 symbol the next day in their holdings.

Now, let's get into our topic and understand this T1 symbol in holdings:

Whenever you purchase any share on a delivery basis or for your holdings then there is a Clearing Corporation (CC) who make sure that you receive the delivery of your shares in your demat account.

As a buyer when you purchase any share your funds get debited and the shares get credited. In the same way, for a seller, the shares get debited and the funds get credited.

Clearing Corporation makes sure that the buyer receives the shares and the seller receives the funds so this whole process takes 3 days (Trading day plus 2 days) hence the settlement cycle is T+2 days.

Let's understand with an example, If you purchase any share on Monday then this will get credited to your demat account on Wednesday evening and until then you will see a T1 symbol in your holdings which means your trade is yet to be settled.

Can you sell T1 holdings?

Yes, you can sell the T1 holdings If you wish to but it is always advisable to wait for the settlement to get completed.

For Trade to Trade category stocks, you can't sell the shares unless the settlement gets completed.

Let's understand with an example If you have purchased a Trade to Trade category stock on Monday and If you wish to sell this on Tuesday or Wednesday then you won't be able to sell it due to the restriction, you need to wait till the settlement gets completed so on Thursday you can sell it.

Now you're aware of this T1 symbol, spread the word ;)

Update- As of 25th February 2022, the settlement cycle has changed to T+1.

See y'all in the next blog, Cheers!

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