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Zecco.com » General Investing » Margin Trading » Margin account question
Last post 05-12-2008, 1:02 AM by akprotov2. 2 replies.
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  •  05-11-2008, 8:52 PM 28903

    Margin account question

    Reply Quote

    Hey I'm new to trading. I hope someone can answer my question.

    I only trade with cash account so far and I have to wait 3 days each time I sell my position. I google around and heard someone said margin account will take away the 3 days wait.

    I want to know if I do use margin account only to not wait 3 days for the position to clear. Will I still get charges for interest?

     

  •  05-11-2008, 11:07 PM 28907 in reply to 28903

    Re: Margin account question

    Reply Quote

    Hi,

        The three day wait will go away once you sell your stock the funds will be ready to use again no intrest will apply.   

          Remember  if your account is under $25,000 you have to be carefull not to trade more than 3 DAY TRADES in a 5 day period. So if you buy x,y,and z today you can sell x,y, and z the next trading day. If you buy and sell  x,y, and z  all in the same day you can no longer day trade for another 5 days. If you break this rule they can suspend you margin account from you.  Thats how it was with scottrader but i think that is how it is for all trading sites. It's a gov. rule.

  •  05-12-2008, 1:02 AM 28909 in reply to 28907

    Re: Margin account question

    Reply Quote

    so as long as I don't use the margin fund to buy stock, I won't have to pay any interest. And I wont have to follow the 3 days rule. Correct?

    Also how dose the interest fees work? Let say if I do use the margin fund to buy stock and sell them at the same day. Am i paying interest rate for 1 day?

    Thank you for answering.
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