When checking your Fidelity account balances, you may come across some “cash” terms you need to familiarise yourself with. They can provide information such as how much money you have deposited or how much money you still have for the business.
Cash Available to Trade vs. Settled Cash
The amount that can be used to purchase shares in the cash account without adding money to the account. A closed order lowers this price (when the order is placed), while a sell order increases this price (when the order is executed).
Cash Available to Trade
Cash available for trading is all the money you have available to purchase stocks (stocks, options, ETFs, etc.) without depositing more money into your account. This price is updated immediately when you trade. The balance will increase when your sell order is executed; The balance will decrease when your order is fulfilled.
Settled Cash
Cash flow is a term used in the financial industry to describe the amount of cash in a brokerage account available for trading. It refers to funds that have already been received and processed by the brokerage firm and are therefore available for immediate use. Understanding cash flow is important for investors and traders because it affects their ability to buy and sell securities.
What is settled cash?
Cash refers to funds located in a brokerage account, settled and available for immediate use. When an investor sells a security, it will take a few days for the proceeds from the sale to be paid, during which time it will be considered “good.” Once the exchange process is completed, the funds are considered “spent” and can be used to purchase additional shares of stock.
Some Important Features
Cash refers to the funds available for trading after previous transactions are taken into account, while cash available for trading (CAT) includes other funds as well as cash in the investor’s account. CAT is calculated as one payout plus any extra money the trader has deposited into his account but has not yet been used to trade.
Real-Time, Intraday, and Overnight
- Instant: Real-time balance updates that show changing values as the market value of the security in your account changes. Essentially, this is a recalculation based on business price changes, market activity, and incoming and outgoing funds. account.
- Intraday: Intraday balance updates show daily transactions and the movement of funds in and out of the account.
- Night: Once the account is updated, the results appear at night. In some cases, due to restrictions, some balances are only updated in the night sky.
Additional Details
For more detailed information about your account balances, you can expand the balances table by clicking Show All, or you can expand an individual section by clicking the “+” sign to the left of any section name or just clicking the name of the section. When the table is expanded for a detailed view of individual balance fields, the “+” sign becomes a “-” sign that you can click to collapse the table and return to the summary view. If all sections of the list are expanded (for example, because you clicked Show All or expanded each section individually), you can collapse the table and click Hide All or return to view the details by clicking the ‘-‘ sign on the left.
Positive/Negative and Credit/Debit
Positive/negative: All values in the current column are positive unless the balance is set to a negative number or the amount must meet certain requirements. In this case, there is a “-” checkmark in front of the number.
Credit/Debit: Some domains will vary depending on whether the amount is positive (credit) or negative (debit). Whether the Balance field shows a credit or debit, the value always indicates that the value is positive. For example, if you have a balance in your margin account when you trade, the amount owed to you will appear as interest. Conversely, if you owe money from trading in your margin account, the amount you owe will appear as interest. Both values appear as positive numbers, and the field name (in this case, Margin Credit or Margin Debit) indicates whether the amount is credited or debited to your account.
Conclusion
“Settled cash” refers to funds within your Fidelity account that have completed the settlement process and are available for trading or investment activities.
On the other hand, “cash available to trade” represents the portion of settled cash that you are able to use specifically for purchasing securities or engaging in trading activities within your Fidelity account.
It’s important to note that while settled cash is generally available for trading, there may be additional factors, such as margin requirements or unsettled trades, that could impact your ability to use the full amount of settled cash for trading purposes.
For precise and up-to-date information regarding settled cash and cash available to trade in your Fidelity account, it’s always recommended to refer to Fidelity’s official documentation, contact their customer service, or review your account statements.