Value date definition
The value date is the date on which counterparts to a financial transaction agree to settle their respective obligations. At the value date, the value of an account, transaction, or asset goes into effect. The value date is more commonly called the maturity date.
In trading the value date denotes when the transaction is completely settled, i.e. the payment is finalised and the asset’s ownership is transferred. When spot trading forex, the value date is often set two days after the trade is closed and the transaction finalised.
Why does it take two days to settle a trade?
The value date is set two days after the trade is settled in forex trading to give both parties enough time to settle their obligations such as making payments and transferring ownership of the currencies. Two days is given to allow time for differences in time zones and bank processing delays.