2.2.3 Close-Out by Purchaser: Buy-In Procedures
When the buyer initiates a close-out transaction, the procedure is called a buy-in. A buyer must wait to effect a buy-in until the third business day following the settlement date (T + 5) for regular way settlement, and the buy-in has to be preceded by a buy-in notice.
The buy-in notice states that unless delivery is made on the effective date as stated in the notice, the buyer may purchase the security in the market on the date specified at the cost to the seller. It further identifies the date that the contract will be closed out, the quantity and contract value of the securities covered by the contract, a