RetireJapan

Hi stupid question about how the スポット購入 works.

I bought some mutual funds with スポット購入 5 days ago and it seems the order just went through today. Is it normal for it to take this long for an order to be processed? I don't remember it taking this long when buying stocks back in Australia.

It also seems to have bought the stocks at today's price (which turned out good for me), is this normal? I thought buying at spot means you buy at the spot price when you place in the order...

Thank you

Depends what you buy but for mutual funds it does indeed take that long since the company actually needs to buy the stocks inside that mutual fund.

smartypants wrote: ↑Wed Jun 15, 2022 2:07 am Hi stupid question about how the スポット購入 works.

I bought some mutual funds with スポット購入 5 days ago and it seems the order just went through today. Is it normal for it to take this long for an order to be processed? I don't remember it taking this long when buying stocks back in Australia.

It also seems to have bought the stocks at today's price (which turned out good for me), is this normal? I thought buying at spot means you buy at the spot price when you place in the order...

Thank you

Mutual funds do not trade during regular hours. Rather they settle at the end of the trading day.

A Mutual fund with only Japanese stocks would take about 48 hours or two business days or so to purchase or sell.

When you introduce multiple stocks in different markets it takes considerably more time.

This is not so important for a long-term investor or a passive investor. If timing is important to your, then you'd want ETFs not Mutual Funds. ETFs trade immediately during market hours.

zeroshiki wrote: ↑Wed Jun 15, 2022 3:04 am Depends what you buy but for mutual funds it does indeed take that long since the company actually needs to buy the stocks inside that mutual fund.

I don't think this is the reason for the delay because mutual funds also have cash positions to help buffer the entry and sale of shares (i.e. your purchase just adds to that cash position initially and is spread across all current investors). Mutual fund transactions can actually settle faster (T+1) than stock transactions (T+2) in the US.

TokyoWart wrote: ↑Thu Jun 16, 2022 7:22 pm
I don't think this is the reason for the delay because mutual funds also have cash positions to help buffer the entry and sale of shares (i.e. your purchase just adds to that cash position initially and is spread across all current investors). Mutual fund transactions can actually settle faster (T+1) than stock transactions (T+2) in the US.

Are they going around at the securities, waiting for hankos and inkans? And may be some khachyou somewhere is on leave, so it gets delayed?

To break down the timeline, my understanding is as follows:

If you place your order after 3:00pm, they cannot accept your order until the following business day.
(if Fri, then not until Mon, or if Mon is a public holiday, not until Tues, and so on)

If you place the order before 3:00pm, (or after 3:00pm the previous business day), then they accept and process your order.

The price then gets set at the price at the end of the Next business day

The products need to be purchased and settlement needs to be completed.

Japanese Assets should be settled on the next business day.
Overseas assets may take 2 or 3 business days

The process is counted in business days, so weekends and public holidays don't count.

If you place an order for overseas assets on Fri, they cannot do anything until Monday in the overseas market which will be Monday evening/Tuesday morning Japan time, or Tuesday evening/Wednesday morning Japan time if there is a Public Holiday in the overseas market, so these will also increase the total duration to settlement, when the Mutual Fund units are deposited in your account.

If you are switching products, they will need to complete and fully settle the sale before they can begin the process for the purchase, which explains the very long settlement.

Here's an example. 800 R-Point order.