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Email this1:56 pm
February 14, 2023
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zgic said
I thought the non-registered brokerage account is always called Margin account. It does not mean I use margin. I am using it for so many years and never bought on margin.
I don't think there is any other non-registered brokerage account.
2:12 pm
October 27, 2013
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They are different when one fills out the application. The default is Cash account for most brokerages as compared to a Margin account. The one you have will be defined on the Scotia summary page, e.g. Scotia iTrade - Cash - XXX-XXXXX Scotia iTrade - RRIF - XXX-XXXXX, etc.
5:25 pm
September 11, 2013
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Yes, mine is a Cash, not Margin, account. As I have no other Scotia business I didn't open it online, I went to a branch where the bank lady filled out my iTrade application at the time, maybe she asked if I wanted cash or margin, I don't recall.
6:23 pm
August 30, 2023
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savemoresaveoften said
The wealthsimple non-registered account for example is a cash account, not margin by default.
And that is a pain cuz one has to keep moving funds from cash account over to the trading account before one can put in a limit order.
Oh good to know about this cash account and margin account. Questrade is just now showing availability of cash accounts. I was wondering what is a cash account. So I guess that is the reason I had only Margin account before.
Regarding your funds transfer from cash to margin to buy a limit order: Are you saying, for example, you have to buy $1000 stock with a limit order, we need more than $1000 in Cash account?
Limit order is actually good as we are defining a fixed price and buying as per what is exactly available as cash.
6:24 pm
August 30, 2023
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kesa said
Thank you kesa for sharing. Good to know about the 2 accounts.
4:56 am
March 30, 2017
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zgic said
Oh good to know about this cash account and margin account. Questrade is just now showing availability of cash accounts. I was wondering what is a cash account. So I guess that is the reason I had only Margin account before.
Regarding your funds transfer from cash to margin to buy a limit order: Are you saying, for example, you have to buy $1000 stock with a limit order, we need more than $1000 in Cash account?
Limit order is actually good as we are defining a fixed price and buying as per what is exactly available as cash.
Yup
For cash and registered account, you can only put in a limit buy order if the funds required for settlement of the buy order is already sitting in the account. Obviously you can put in any limit price sell order for any assets you already have in the acct at any time.
6:52 am
October 27, 2013
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savemoresaveoften said
Yup
For cash and registered account, you can only put in a limit buy order if the funds required for settlement of the buy order is already sitting in the account. Obviously you can put in any limit price sell order for any assets you already have in the acct at any time.
That should not necessarily be the case in a Cash account. The only requirement for Cash accounts in the brokerages I am familiar with is that the funds be in the account to pay for your purchase by Settlement day.
7:14 am
March 30, 2017
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AltaRed said
That should not necessarily be the case in a Cash account. The only requirement for Cash accounts in the brokerages I am familiar with is that the funds be in the account to pay for your purchase by Settlement day.
Interesting. How do they be sure that you WILL deposit the cash after the order is filled ? Yes they can sell the position if you dont, and make you responsible for the loss (if price drops). But sounds like a very inefficient mechanism and cant see why a brokerage has any incentive to do that.
With next day settlement now, I will be surprised if they will still allow u to buy in day 0, and deposit next day for settlement.
7:21 am
October 27, 2013
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It has always been this way in non-registered accounts for trades (other than GICs) that I have made in Scotia iTrade, BMO Investorline and RBC Direct Investing for all the years I have been investing. Whether T+1 settlement (MMF, ISAs, Cash ETFs?) or T+2 (everything else). The change to T+1 from T+2 does not occur until late May sometime. GICs are T+0 settlement, i.e. the cash must be in account to purchase them.
They cannot be sure you will deposit the cash by Settlement day but you are expected too per the Ts&Cs of your account contract. They can always sell something in your account on your behalf and charge you both agent facilitated commission (in the order of $40 I suspect) plus interest for the cash loan until settled.
7:27 am
March 30, 2017
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I guess WS is the only one that does it differently then ?
That is the ONLY cash trading account I have, and they require funds to be in the account before they will accept a limit order. So I have been transferring back and forth btw the cash deposit account and the non reg trading acct every time I want to put in a limit order, a huge nuisance.
All my other trading accounts elsewhere are always margin account.
7:46 am
October 27, 2013
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I have no knowledge of how WS works. I do believe, as an upstart, it is an oddball/different from most other brokerages (IBKR being different as well). My brokerage needs have always been rather plain vanilla.
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