What is cash account?Cash Account
An account that can only buy shares with your own money, with no borrowing or short selling. It isn't subject to the PDT rule, but sale money has to settle before it can be reused “cleanly”.
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- US Stock RulesThe PDT Rule: Limits on Day Trades
A margin account that makes 4 or more day trades in any 5 trading days is flagged as a PDT and needs at least $25,000 in account equity to keep going.
- US Stock RulesT+1 Settlement and Cash Accounts
US stocks bought today can be sold today, and the cash and shares settle on the next trading day; in a cash account, buying with unsettled money and then selling is a “good faith violation”.
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Go to “The PDT Rule: Limits on Day Trades”