Effective Date

DEFINITION of 'Effective Date'

The date, declared by the Securities & Exchange Commission (SEC), on which shares can start trading. This usually refers to the date when shares become available for sale in an initial public offering.

BREAKING DOWN 'Effective Date'

The effective date occurs approximately 20 days after the security is registered with the SEC, giving time for the SEC to review the registration. The registration will be either accepted or rejected by the twentieth day or earlier. Amendments can be made to the registration if the SEC deems that changes are necessary. If the items in question are not modified, the registration process is not completed.

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RELATED FAQS
  1. If an issuer wishes to register a security in the state ...

    The correct answer is a. Registration by coordination is permitted when the issuer has filed a registration application with ... Read Answer >>
  2. How do I know if I am buying unregistered securities or stocks?

    All securities, including stocks, bonds and notes, must be registered with the Securities and Exchange Commission (SEC) before ... Read Answer >>
  3. The "effective date" is defined as:

    A. The date a security's registration statement is granted an effective date lasting for one year. B. The date the first ... Read Answer >>
  4. The “effective date” is defined as:

    a. the date a security's registration is approved - lasting for one year. b. the date the first transaction of an approved ... Read Answer >>
  5. How does piggyback registration work?

    Registration rights ensure that companies cooperate during the registration process through which investors register shares ... Read Answer >>
  6. What are unregistered securities or stocks?

    Before securities, like stocks, bonds and notes, can be offered for sale to the public, they first must be registered with ... Read Answer >>
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