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Market Structure

Fail to Deliver

Definition

A trade that does not settle on T+2 because the seller cannot deliver shares. Persistent fails can indicate naked short selling. The ASX publishes fail statistics and ASIC investigates suspected naked short cases.

Related Terms

T+2 Settlement

The ASX settles cash-equity trades two business days after execution. The buyer receives shares and the seller receives cash on T+2. Short sellers must deliver borrowed shares by T+2 to avoid a fail-to-deliver.

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