I made a small mistake on my long term holding portfolio account. I sold something and I forgot about the stupid rule. What does this mean I cannot sell or buy stock for 90 days on this account? Why not just provide a warning. Pursuant to interpretive guidance released by the Board of Governors of the Federal Reserve System regarding Regulation T, cash account customers are prohibited from selling securities prior to making full cash payment for the shares. Customers may use existing cash in the account, the proceeds from sales of fully-paid-for securities, and additional deposits of cash to make such payment. Proceeds of sales may be used for payment of a purchase only on or after the settlement date of such sales. In the event where a cash account customer sells a security that has not been fully-paid for, the account may be restricted for 90 days. E*TRADE Securities will require settled cash prior to making purchases in such accounts. The example below illustrates the type of activity that will result in an account being placed on a 90-day restriction: At the beginning of the day, a customer holds 1,000 shares (settled) of Company X in a cash account. The customer then makes the following transactions: The customer sells 1,000 shares of Company X for $25,000. Using the funds from the sale of Company X, the customer then purchases 2,000 shares of Company Y for $25,000 on the same day. Before the sale of Company X has settled, the client sells the position in Company Y and receives $25,000. In the example above, based on the Federal Reserve Board interpretive guidance, the customer sold Company Y shares before paying for them. This would result in the 90-day trading restriction referenced above being placed on the account. Restrictions on an account may be avoided if the security that was purchased is fully-paid for within five business days after the trade date by: Depositing enough additional cash into your account to fully fund the purchase; Combining accounts to increase the amount of cash available to pay for the purchase.
I'm guessing that you have a cash account. What this means is that for 90 days, if you sell a stock, you're going to have to wait 3 days before you can the money you got from selling it again. So before, you were able to buy --> sell --> buy (must hold for 3 days) but now it is buy --> sell (wait 3 days) --> buy.
Oh, no big deal its not a day trade account. That is my other account. I messed up and forgot is was a cash account. Now what if I deposit the amount of the trade in question will it clear me?
Can I write a letter to Bernanke to bail me out and lift this restriction. I mean they hook up the banks.
You can definitely sell any time. Just can't buy again after selling on the same day (day-trading) for 90 days (unless you have enough cash to cover it).