IBKR day-swing trading with cash account T+2 problem

[trefledez]

Hello,
I plan to trade US stocks using a cash account, the problem is that theoretically we have to wait at least two days after the sale to receive our money in order to invest it in other stocks. (T + 2 settlement)
Is there a solution to bypass this law? people say (possibly) that buying and selling in day trading is done internally without the need for the action to be in my name.
knowing that I don't strictly want to trade margin account
Thanks!

 

[MoreLeverage]

The solution is to use a margin account to avoid settlement delays, but just not use the margin for leverage. Otherwise you’ll run into SEC free riding and similar cash account violations if you trade too frequently and get restricted to trading only settled cash.

 

[trefledez]

The solution is to use a margin account to avoid settlement delays, but just not use the margin for leverage. Otherwise you’ll run into SEC free riding and similar cash account violations if you trade too frequently and get restricted to trading only settled cash.

is it possible to not use leverage in margin accounts? if yes, are there any fees to pay?

 

[fan27]

is it possible to not use leverage in margin accounts? if yes, are there any fees to pay?

Yes...no need to use margin. IB will charge $10 per month if you don't meet the commission threshold if you have under $100k in the account. See their site for details.

 

[levanyashin]

I understand your concern but why not just open margin account straight ? It can stay there and you don't have to use the money and pay any interest. There is also the PDT rule for daytrading below 25k account

 

[trefledez]

I understand your concern but why not just open margin account straight ? It can stay there and you don't have to use the money and pay any interest. There is also the PDT rule for daytrading below 25k account

does that mean i can create a margin account without necessarily using leverage?
Thanks.

 

[trefledez]

Yes...no need to use margin. IB will charge $10 per month if you don't meet the commission threshold if you have under $100k in the account. See their site for details.

If I understood correctly, the difference between cash and margin is T + 2, otherwise, on a margin account I can trade without using leverage as on the cash account, just that the shares are not in my name. that's it?
Thank you.

 

[levanyashin]

does that mean i can create a margin account without necessarily using leverage?
Thanks.

Its up to you whether you gonna use the money or not. No one gonna force you to open a position for a few days/weeks or months on margin and make you pay interest for it unless you want to. It's under your control. The timer starts when you open a position above your initial capital. Say you got 100k in the account and you buy shares worth 110k and decide to hold, the timer for 10k interest starts ticking. Capiche? Its under your control

 

[trefledez]

Its up to you whether you gonna use the money or not. No one gonna force you to open a position for a few days/weeks or months on margin and make you pay interest for it unless you want to. It's under your control. The timer starts when you open a position above your initial capital. Say you got 100k in the account and you buy shares worth 110k and decide to hold, the timer for 10k interest starts ticking. Capiche? Its under your control

Thank you very much for all these explanations, so ultimately what is the difference between CASH and MARGIN if we can trade without leverage on MARGIN account?
Thanks.

 

[levanyashin]

Thank you very much for all these explanations, so ultimately what is the difference between CASH and MARGIN if we can trade without leverage on MARGIN account?
Thanks.

There is no difference. On margin; You pay or earn on interest, only if you borrow money above your capital. So if you are sensitive on interest matters just dont hold overnight positions with extra leverage above your capital. Yes you can trade with or without leverage, as said it is up to you.