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Zecco.com » General Investing » Margin Trading » Withdrawing cash?
Last post 04-13-2008, 6:36 PM by koreiko. 2 replies.
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  •  04-13-2008, 4:52 PM 26926

    Withdrawing cash?

    Reply Quote
    So I've encountered something interesting.   I tried to withdraw some profits on friday but was denied because of the T +3 clearing rule (which I am aware of and understand) which got me wondering:  How do you you ever withdraw cash if you are constantly daytrading with margin?  Since I trade using margin all my available funds are in use, so do I have to not trade at all for 3 days when ever I want to withdraw funds?  If I were to open a cash account along side my margin account, is it possible to readily transfer money between the 2 or do you have to wait T +3 for that too, if it's even possible.  I was thinking, if it is possible, to transfer the amount I want to withdraw to the cash account to wait for the T +3 to pass and still have my margin account free to work with.  Any ideas?

  •  04-13-2008, 5:36 PM 26933 in reply to 26926

    Re: Withdrawing cash?

    Reply Quote
    I guess you could just wait until you have no open margin positions.  Or no open positions at all.  I try to keep 10 to 15 percent cash in my account for two reasons.  In case I want to buy more, or if i want to pull out some profits, generally speaking though. I use the profits to make more money.

  •  04-13-2008, 6:36 PM 26940 in reply to 26926

    Re: Withdrawing cash?

    Reply Quote

    wewantutopia:
    So I've encountered something interesting.   I tried to withdraw some profits on friday but was denied because of the T +3 clearing rule (which I am aware of and understand) which got me wondering:  How do you you ever withdraw cash if you are constantly daytrading with margin?  Since I trade using margin all my available funds are in use, so do I have to not trade at all for 3 days when ever I want to withdraw funds?  If I were to open a cash account along side my margin account, is it possible to readily transfer money between the 2 or do you have to wait T +3 for that too, if it's even possible.  I was thinking, if it is possible, to transfer the amount I want to withdraw to the cash account to wait for the T +3 to pass and still have my margin account free to work with.  Any ideas?

    Remember, when you take cash out your buying power is not reduced with the same amount. Your buying power will be reduced by 2.5*(cash withdrawal). So, if you don't have enough buying power you cannot clear a cash withdrawal. For example, if you want to clear a $1000 cash transfer, you should have $2500 buying power and not place any orders after requesting a cash withdrawal for that day. Or even if you do, make sure you leave $2500 free on your account. 
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