Rolling Settlement
A system in which every trading day is a separate settlement cycle, so trades settle a fixed number of days after execution.
How it is identified
Test: each trade date has its own settlement date; there is no fixed weekly or fortnightly settlement day
Unit
qualitative
In depth
Before rolling settlement, Indian exchanges used account periods where all trades in a week settled together, which allowed positions to be carried without delivery and concentrated systemic risk on a single day. Rolling settlement removed that by making every day independent, which is why the badla carry-forward system disappeared and exchange-traded derivatives took over the job of leverage. The design also means there is no 'settlement day' effect in the calendar. Its main practical consequence is that a position genuinely must be paid for or delivered within the cycle.
Worked example
Under rolling T+1, a Monday trade settles Tuesday and a Tuesday trade settles Wednesday, independently. Under the old weekly system, both would have settled together at the end of the account period, letting positions be rolled without payment.
Illustrative figures, chosen so the arithmetic is easy to follow. Not a live price and not a valuation of any company.
Educational reference only
This entry explains what “Rolling Settlement” means. It is not investment advice and not a recommendation to buy or sell any security. Any numbers above are illustrative, not live prices, and nothing here predicts price direction or rates a stock. Consider your own circumstances and consult a SEBI-registered investment adviser before acting.