SEBI chairman Ajay Tyagi has stated that shortened trade cycle will help investorsSecurities and Exchange Board of India (SEBI) chairman Ajay Tyagi on Thursday said that the soon to be carried out reduced trade settlement cycle will benefit all market individuals.

He added that it will not result in any liquidity fragmentation.Speaking at an occasion organised by the market body Confederation of Indian Industry (CII), Mr Tyagi said that T +1 (Trade plus one day) cycle will ultimately benefit all investors.

The new routine will come into impact from January 1, 2022.

Under the T +1 cycle, all trade related settlements are to be cleared within a day of the deal having actually taken place.

Currently, all trades conducted on stock exchanges are settled within 2 days after the completion of the transactions.

Early settlement will benefit all market participants.

It is in the interest of everybody and the new system will not result in fragmentation of liquidity, Mr Tyagi said.The SEBI chief's comments have can be found in the backdrop of the brokers' association expressing their concern over the execution of the reduced trade settlement cycle.Earlier this month, SEBI had actually permitted exchanges to transfer to the T +1 settlement cycle on an optional basis.