if I bought a share for delivery not intraday then do I take possession of that share on that same day? like is the share under my control or under the broker control? And when I sell that share then the money is immediately transferred to the buyer or it takes few days?
Once you purchase the shares, it will be delivered to your account on T+2 day. Once it is delivered, you will be the shareholder of that company and will be having the holding rights. You can refer varsity for better clarity.
1 Like
The share comes to your demat account at the end of the second working day after the day that you bought the share. E.g: If you bought on a Monday (“T” day), and Tuesday and Wednesday are working days, then the share will appear in your demat account at the end of Wednesday (T+2 day). If there are holidays, then it will take longer.
The share comes to your demat account, so it belongs to you, starting day T+2.
When you sell a share, then money is transferred to your account, not to the buyer’s account!!
The same “+ 2 working days” logic applies here also: if you sell the share on day T, then the money will appear in your bank account towards the end of day T+2. Note that this whole T, T+2 business excludes non-working days (such as weekends or holidays). So, for example, if you sell the share on a Friday, then the earliest that you will get the money in your bank account is the next Tuesday evening, which is the fifth day counting from the day of sale. This is assuming that the Monday and Tuesday are not holidays.
So yhe shares at T+1 day will be with zerodha right? And if I sell a share then amount instantly is shown in my funds then why are you saying t+2 days
The shares will be shown as “on hold” (or something similar) in your demat account on day T+1. Think of this like: You pay someone Rs.500/- using a cheque, and they present the cheque at another city. It may take a couple of days for the amount to leave your account, but it will be shown as “on hold” or something similar, till it goes out to the other person’s account a couple of days later. You won’t be able to take this Rs.500/- out of your account during these days, though it may be shown as part of the account total.
It is similar with shares and selling: You won’t be able to touch the shares on days T and T + 1, even though they may still appear in the demat totals. This number of shares will be clearly marked as “on hold” (or some similar term). You can think of this as: Zerodha has grabbed these shares on day T, and on day T+2 they actually take it out of your account.
This amount is only in your Zerodha account instantly, not in your bank account. You can use this amount to do further transactions on Zerodha, but you cannot take it out of Zerodha and into your bank account (and use it for buying other stuff/paying loans/…) till day T+2.
Zerodha shows this amount instantly in your account, because they know that on day T+2 they can get it from the buyer (to whom you sold your shares). So they allow you to use this money on Zerodha as if you had already got it. But: the money will actually be there only on day T+2. Think of this like how credit works in the business world: people run their daily businesses on credit (“rolling” money), and settle the amounts only once in a week, or two weeks, or some other regular interval. This is similar: till the settlement happens on T+2, Zerodha lets you use the money as (interest-free) credit.
You can think of the amounts which are instantly there, as “Zerodha Rupees”: you can only use this to do things on the Zerodha platform. The amounts that you get on day T+2 are the real Indian Rupees, which you can use everywhere, not just on Zerodha.