...and my ACCOUNT dips into the negative
(Meaning negative account, not negative stock price.)
Margin Call Lawsuits Expected to Spike
- Thread starter guru
- Start date
(Meaning negative account, not negative stock price.)
What I am asking is...with stocks, can you get a margin call if you are holding stocks without margin?
No. How can you? You're not borrowing money (eg. margin). Everything comes out of your CASH account.
I guess you can compare this to debit vs credit card. With debit card, you don't owe interest since it comes out of your bank account. With credit card, however, you owe interest if you don't pay off in full.
Yes, I forgot I owned a stock in a IRA that got delisted and I could not sell it for even a penny total. The DTC charged my broker a recharacterization fee of $50. That's -$50 for a stock that went to $0 in a cash account.
No but I have seen listed stocks drop so low that they get "delisted" and then pop up on penny sheets to continue trading there.
If you own shares when a stock gets delisted...they'll send you your certificates although they are worthless but only good for tax deductions...assuming it doesn't pop on the penny sheets.
wrbtrader
Well, that's a complete different story than seeing your (margin) account go negative due to a stock meltdown.
True. Delisted stocks share the same fate as bankrupt stocks. But what I want to know is why did you not sell the stock earlier? You would have known through press coverage or the pace of price descent that it would get delisted.
I was trying to be funny, remember when someone shorted Martin Shrekli's biotech at $1.60 and turned $30,000 into -$150,000 because he thought E-Trade should have BTC him out? There was a GoFundMe until Zero Hedge roasted him. I wonder if he paid E-Trade or went BK?
That is not a stock that has gone negative, that is a fee that dropped your NLV to $-50.
So to meander back to @schizo point...
...why would your account go negative if your stock cannot go negative? Your NLV is zero, but you still own the stock. The broker is holding none of your money as collateral. So why would you sue, if they have no reason to liquidate your position?
More to the point, why would they liquidate your position? How CAN they? It's YOUR stock, not theirs.