Does the $25,000 have to be in cash or can it be for example $25,000 worth of apple stock and another $10,000 in cash which will be used for day trading
Does the $25,000 have to be in cash or can it be for example $25,000 worth of apple stock and another $10,000 in cash which will be used for day trading
Only your "cash" portion can have a 4:1 margin for day trading. Any portion of your account that is used to hold a stock overnight, that portion can only have a 2:1 margin.
For example: you start with $25000 in your account. You decided to own $25000 worth of AAPL stock overnight. The following day, you can only buy $25000 worth of AAPL or other marginable stocks, not $100000.
If you decided to own $10000 worth of AAPL stock overnight. The following day, you have $10000 (from AAPL stock) plus $15000 x 4 = $70000 of buying power for day trading.
