Newbie question about buying power in cash account..

Discussion in 'Trading' started by Dangerous_Doug, Nov 4, 2011.

  1. Hi everyone,

    In my virtual account buying power seemed pretty straight forward, but I learned the hard way that my virtual account was a margin account, and about the vast differences between margin and cash accounts once I had real skin in the game lol.

    anyhow, buying power still has me quite confused and everything I can find to read about it is about as clear as mud. :confused:

    I made quite a few trades yesterday, many of them day trades. (as I understand day trading profile only applies to margin accounts?) and at the end of the day I had maybe about $ 200 worth of buying power left, about $ 5,000 in cash and about 5,000 in stocks at close. This morning when the market opened I still had only 200 in buying power, what am I missing here? does it take a while to reset or was it something I did?

    Hope this makes sense to someone who can explain it to me! please


  2. russ1


    The formula apparently varies by broker
    Equity + Cash - Debit balance-2*margin requirements had this and an I.B. formula listed under leverage
  3. Ok, thanks for the info it's much appreciated.

    I am very new to trading, as I am sure you can tell.

    Something still seems off but maybe OptionsHouse was glitchy, I will see what Monday brings and learn all that I can in the meantime. Wish I payed more attention in Math class :)