Frank's Tea Party Revolt

[followinsnsr]

After looking at the rules, I can clearly see what I may have done wrong. I always assumed because I have this account through my bank and I can transfer money from my savings to my Investment account. The broker could also take from my savings and move it into my investment account. The broker said he can't do that without written permission. The links here make it clear what can and cannot be done. I would assume it would be the same for the company I deal with.
Here is an example of using unsettled funds in your cash account, which would cause a good faith violation to be issued.
- starting cash balance is $0
- 05/31/05 Sell 100 XYZ for $1000 (settles 6/3/05)
- cash balance $1000
- 06/01/05 Buy 100 ABC for $1000. You are not supposed to sell this stock until on or after 6/3/05 (when the sale of XYZ settles).
- 06/02/05 Sell 100 ABC (Good Faith Violation issued)

If you sell a particular stock today, you are not supposed to buy the same stock back the same day using the proceeds from the previous sale. Here is example of an intra-day cash trade of the same stock, which would cause a good faith violation to be issued:
- starting cash balance is $0
- 05/31/05 10:00AM Sell 100 XYZ for $1100 (settles 6/3/05)
- cash balance $1100
- 05/31/05 12:30PM Buy 100 XYZ for $900 (Good faith violation issed. It does not matter that the sell occurred first)



http://www.tradingdirect.com/Static/Help/tradingrules.html
rule change:
http://www.tradingdirect.com/Static/Help/cashtrading_completerule.pdf