How Long Does an ACAT Transfer Take?

An Automated Customer Account Transfer (ACAT) is a standardized system that facilitates the movement of investment accounts between financial institutions. This electronic system allows investors to move brokerage holdings, including securities, from one firm to another without manual liquidation and re-purchase. ACAT transfers provide an efficient and secure method for investors to consolidate portfolios or switch firms while maintaining their existing investments.

Standard ACAT Transfer Timelines

A standard ACAT transfer generally ranges from 3 to 10 business days, with many completed within approximately 6 business days once initiated. For full account transfers, the process usually takes between 5 to 7 business days from the submission date. Partial transfers, involving only a portion of the account’s assets, may be completed in 3 to 5 business days. Actual completion times can vary based on several factors.

Factors Affecting Transfer Speed

Several elements can influence the speed of an ACAT transfer. The type of assets is a significant factor. Certain assets, like mutual funds or alternative investments, may require additional processing or liquidation if not eligible for direct ACAT transfer. Physical certificates or proprietary products often cannot be transferred and may need to be sold or moved manually. Fractional shares are ineligible for electronic transfer and must be liquidated.

Discrepancies in account information frequently cause delays. Mismatched names, addresses, or Social Security Numbers can lead to rejection, requiring corrections. Outstanding balances or unvested shares can hold up the transfer until resolved. The internal processes and responsiveness of both firms, including their ability to validate information and process requests, affect overall speed. A security lockdown or trading activity in the account after initiation can also lead to postponements.

Preparing for a Smooth Transfer

Preparation before initiating an ACAT transfer helps ensure a smooth process. Gather accurate account numbers and details from both the current (delivering) and new (receiving) financial institutions. Ensure personal information, such as names, addresses, and Social Security Numbers, matches exactly across all accounts and documentation.

Understand the type of assets you intend to transfer. Confirm whether the account is taxable, an Individual Retirement Account (IRA), or a Roth IRA, as different account types may have specific transfer requirements. Inquire about any potential transfer fees the delivering firm might charge. Verify the new firm can hold all desired asset types, as some firms may not support certain investments. The receiving firm initiates the ACAT request and provides necessary forms, such as a Transfer Initiation Form (TIF). Accurately completing these forms using the gathered details will help prevent delays.

The ACAT Transfer Process Steps

The ACAT transfer process begins with the receiving firm. The new firm submits an electronic ACAT request, a Transfer Initiation Form (TIF), to the delivering firm. This request includes customer details like name, account number, and Social Security Number. The delivering firm has a mandated timeframe, usually three business days, to validate the transfer or take exception. FINRA Rule 11870 governs this process.

If the delivering firm validates the transfer, it prepares the assets. If the account contains ineligible assets, such as certain proprietary mutual funds or alternative investments, the client is notified to provide disposition instructions, which may include liquidation. After validation, assets are electronically transferred from the delivering firm to the receiving firm. This includes securities and cash balances, with cost basis information transferred. Both firms monitor progress. Clients receive confirmation from their new broker once the transfer is complete and holdings are settled in the new account.