Trade date
The trade date is the day an order actually executes, the moment a buy or sell agreement is struck at a specific price, as distinct from the , which comes later once cash and shares actually change hands. When an investor sees a filled order confirmation, the date on that confirmation is the trade date, even though the transaction is not fully complete from a legal and accounting standpoint until settlement.
This distinction matters because many important calculations and rules key off the trade date specifically, rather than the . The price an investor pays or receives, and the gain or loss on a position for tax purposes, are generally determined by the trade date, not by whenever settlement happens to finish one business day later under . Similarly, whether a trade counts toward or against a wash sale calculation is judged by trade date.
Other rules, particularly around eligibility, depend on the relationship between the trade date and a company's , since an investor generally needs to have purchased shares early enough, relative to settlement timing, for the trade to count as owning the by the relevant date. Understanding the difference between trade date and helps explain why a trade that appears to execute cleanly on one day can still have consequences that depend on timing that plays out slightly later.