When-Issued Securities

What this video covers

• The formal definition of when-issued (WI) securities as trading on a when, as, and if issued basis before actual issuance and settlement
• Why the holding period begins the day after the when-issued trade date, not on the later issuance or settlement date, using the same day-after-trade-date convention as a regular purchase
• How cost basis is permanently locked in at the price agreed upon in the when-issued transaction, regardless of market fluctuations before issuance
• Why standard T-plus-one settlement rules do not apply to when-issued trades, which instead settle exclusively on the security's issuance date
• How to calculate whether a gain qualifies as short-term or long-term by correctly starting the holding period clock from the when-issued trade date