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Brokers that don't have T+3 settlements
- Thread starter jczorch
- Start date
Quote from jczorch:
Can anyone name a few brokers that don't make you wait for the funds to settle before you reinvest that money? Are there also brokers that have a shorter settlement date ie one or two days?
This situation applies in a few scenarios:
1. If you want ro re-invest your money with another brokerage, you will have to wait T+3 before you can have your funds transferred to another brokerage.
2. If you want to switch your trading account to another brokerage, then again you have to wait T+3 before funds are available and/or your existing equity is transferred to your new brokerage.
3. This may not be relevant to you but just to complete this explanation, taxes are also computed based on trade dates but monthly brokerage statements are computed based on settlement dates.
Quote from GTC:
jczorch, even for withdrawal, you may be allowed to withdraw your cash from your account before T+3 days provided you leave sufficient cash to offset pending margin charges.
The above is true only if your margin equity as a percentage of total market value is 40% and above. If your margin equity falls below 40% as a result of your withdrawing funds, then the brokerage will not allow withdrawal of funds. Therefore, you can withdraw funds if after the withdrawal your margin equity as a percentage of total market value is 40% or over.
Quote from ak15:
The above is true only if your margin equity as a percentage of total market value is 40% and above. If your margin equity falls below 40% as a result of your withdrawing funds, then the brokerage will not allow withdrawal of funds. Therefore, you can withdraw funds if after the withdrawal your margin equity as a percentage of total market value is 40% or over.
ak15,
the equity has nothing to do with waiting for settlement. your info is true regardless of whether the funds are settled or not. also, most firms I know of have 30% requirement, and some even go to NASD's min of 25%.
Quote from spreadgod:
ak15,
the equity has nothing to do with waiting for settlement. your info is true regardless of whether the funds are settled or not. also, most firms I know of have 30% requirement, and some even go to NASD's min of 25%.
You're taking it out of context. Equity has everything to do as far as withdrawing funds from your account. The firms that I know will not allow withdrawal if the percentage falls below 40%. i was responding to an earlier post that specifically mentioned about having sufficient funds before withdrawing.
Quote from rover:
why would a broker not let trade settle before giving u money. free loan?
Yes. that's why if you are a serious trader you use a margin account. the only reason you should ever have a cash account is because it's a retirement account. if you want to withdraw before settlement, go ahead. we'll charge you margin for 3 days and everyone's happy.