DEFINITION of After date
After date refers to a bill of exchange that must be paid a particular number of days after the day shown on the document.
WHAT IT IS IN ESSENCE
It is payment on a negotiable instrument becomes. Due to a specified number of days after the presentation of the draft. Such as a bank draft for instance.
In banking – It is a notation on financial instruments (such as drafts or bill of exchange) to fix the maturity time. As a fixed number of days.
When trading – The day when some order is executed in the market. It is when an order to buy, sell is performed. It is determining for all types of investment security transactions in the market.
If the trade is executed after the market’s close it is recorded with a trade period on the following day.
We can meet two parts of ”After date” issue: Broken Date and Notification date.
Broken are arbitrary maturity dates. They do not necessarily match the duration of the bond, option, futures contract, forward contract or another maturing instrument. Broken dates are also known as odd dates.
The finance world greatly relies on standardized maturities for specific contract types. This results in consistent recordkeeping and reporting for investors and the rest of the financial world. It makes trading easier and less costly. When a contract has broken date, it is something of a “rogue” investment. And requires extra care from the implicated financial services firms and investors who hold the securities.
Notification – The day by which one party to a contract must inform the other of the former’s intent to either renew or withdraw from the contract. This especially applies to house leases, marketing contracts, and long-term business arrangements. Some contracts renew automatically if neither party cancels by the notification date. While others require notification either way. In options, refers to the expiration date.
HOW TO USE
For example, if a draft stipulates “30 days after date”, it means that the draft is due (payable) 30 days after the day it was drawn. This has the effect of fixing the time of maturity of the draft. And it is independent of the time of acceptance of the draft.