What is a quarterly settlement or running account settlement?

What Is a Quarterly Settlement?

A quarterly settlement, also known as a running account settlement, is a process mandated by regulatory authorities to ensure that brokerage firms periodically return any unutilised funds to their clients. This practice is designed to protect investors and ensure transparency in the management of their funds. 

Typically, brokerage firms hold the funds that clients deposit for trading purposes. If these funds are not fully utilised within a specific period, usually a quarter (three months), the brokerage is required to return the excess amount to the client’s bank account.

Why Is Quarterly Settlement Important?

The quarterly settlement process is crucial for maintaining the integrity of client accounts, ensuring that any unutilised funds are not improperly withheld by the broker. 

• The settlement also provides an opportunity for investors to review their trading activity and assess whether their funds are being utilised efficiently. 
• At the end of each quarter, the brokerage firm calculates the total amount available in the client’s trading account, including any proceeds from sales of securities and other credits. If the balance exceeds a certain threshold (after accounting for any pending obligations or open positions), the excess funds are transferred back to the client.

Share India’s Commitment to Transparency

Share India, a leading brokerage firm, adheres to the guidelines set forth by regulatory authorities, ensuring that its clients’ funds are managed transparently and efficiently. It conducts quarterly settlements diligently, allowing its clients to have greater control over their investments and ensuring that any excess funds are promptly returned. By following these practices, it helps foster trust and confidence among its clients, reinforcing its commitment to providing a secure and transparent trading environment.

Understanding the importance of quarterly settlements can empower investors to make more informed decisions about their trading activities and financial planning.