Failures to Deliver (FTDs)
Lesson 4 of 66 min5 exercises
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When Shares Don't Show Up
A Failure to Deliver (FTD) occurs when a seller fails to deliver shares to a buyer by the settlement date. This can indicate naked shorting or other market mechanics issues.
Why FTDs Matter
High FTDs can indicate:
- Naked shorting (selling shares that don't exist)
- Settlement issues
- Unusual market activity
- Potential future buying pressure (to settle)
FTDs MUST eventually be settled, creating future buying pressure.
- Naked shorting (selling shares that don't exist)
- Settlement issues
- Unusual market activity
- Potential future buying pressure (to settle)
FTDs MUST eventually be settled, creating future buying pressure.
Learn · 2/3
T+35 Rule
Market makers have up to 35 calendar days (T+35) to settle FTDs. Large FTDs can predict future price spikes when they must be closed.
Tip
SUTOK tracks FTD data when available. Large FTD spikes followed by T+35 can be trading opportunities.
Learn · 3/3
Key takeaways
- FTD = seller failed to deliver shares by settlement
- Can indicate naked shorting or settlement issues
- FTDs must eventually be settled (future buying)
- T+35 rule creates predictable settlement dates
Next: 5 quick exercises. Miss one and it comes back at the end.