I am not sure how this works. I started a portfolio with $10,000. I purchased 264 shares of SSO at $37.43 (=9881.52). However, the info says that I still have $4,931 of buying power. What am I missing?[LINKSYSTEM_44330033]
It’s called margin.
We assume all stock trades are made with 50% margin. You don’t have to take advantage of this. Simply only buy half the stock you are allowed to buy.
For example, if you start with $10,000, you are allowed to buy $20,000 worth of stock. Don’t want to use margin? Then limit your portfolio to only $10,000 worth of stock.
Matthew:
The buying power is not as clear to new members as I think it should be. I had the same issue when I first joined. In my opinion, the account info should clearly state how much cash is available and how much margin is available.
Fred
I totally agree with you Fred.
Collective2 could do a better job by being more specific in this area on its web site.
not looking at it now, but does it have one of those ? help popups to give explanation?
When you open a ticket to buy or sell a stock or ETF, the buying power appears above the top right corner of the ticket but there isn’t a breakdown of buying power into cash and margin thus making it confusing.
