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.

RELATED TERMS
  1. SEC Form 1

    An application for and amendments to an application for registration ...
  2. SEC Form 10

    A filing with the Securities and Exchange Commission (SEC), also ...
  3. SEC Form 24F-2NT

    A filing with the Securities and Exchange Commission (SEC) that ...
  4. SEC Form S-8

    A filing with the Securities and Exchange Commission (SEC) that ...
  5. SEC Form S-6

    A filing with the Securities and Exchange Commission (SEC), which ...
  6. SEC Form 8-A12B

    A filing with the Securities and Exchange Commission (SEC) that ...
Related Articles
  1. Insights

    Understanding the SEC

    The SEC's triple mandate of investor protection, maintenance of orderly markets and facilitation of capital formation makes it a vital player in capital markets.
  2. Personal Finance

    What's the SEC?

    The Securities and Exchange Commission (SEC) is an independent agency of the United States government. The mission of the SEC is to enforce securities laws passed by congress. These laws aim ...
  3. Investing

    Series 63 Exam State Securities Administrator

    Learn what you need to know about the state securities administrator to pass the Series 63 exam.
  4. Personal Finance

    Policing The Securities Market: An Overview Of The SEC

    Find out how this regulatory body protects the rights of investors.
  5. Investing

    What is a Settlement Date?

    A settlement date is the day a security trade must be settled.
  6. Insights

    The SEC: A Brief History Of Regulation

    The SEC has continued to make the market a safer place and to learn from and adapt to new scandals and crises.
  7. Investing

    What is a Record Date?

    The date established by an issuer of a security for the purpose of determining the holders who are entitled to receive a dividend or distribution.
  8. Taxes

    How A Company Files With The SEC

    Filing with the SEC is not as complicated as you might thing -- just be meticulous about following the steps.
  9. Financial Advisor

    Becoming A Registered Investment Advisor

    To become a registered investment advisor requires specific licensing, qualifications and regulations, but the greater freedom may be worth it.
  10. Small Business

    New Avenues For Bitcoin Funding Opened Up By SEC

    Could New SEC Regulations Pave the Way for Investing in Bitcoin Startups?
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. How does piggyback registration work?

    Registration rights ensure that companies cooperate during the registration process through which investors register shares ... Read Answer >>
  5. 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 >>
  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 >>
Hot Definitions
  1. 403(b) Plan

    A retirement plan for certain employees of public schools, tax-exempt organizations and certain ministers. Generally, retirement ...
  2. Master Of Business Administration - MBA

    A graduate degree achieved at a university or college that provides theoretical and practical training to help graduates ...
  3. Liquidity Event

    An event that allows initial investors in a company to cash out some or all of their ownership shares and is considered an ...
  4. Job Market

    A market in which employers search for employees and employees search for jobs. The job market is not a physical place as ...
  5. Yuppie

    Yuppie is a slang term denoting the market segment of young urban professionals. A yuppie is often characterized by youth, ...
  6. SEC Form 13F

    A filing with the Securities and Exchange Commission (SEC), also known as the Information Required of Institutional Investment ...
Trading Center