Can someone explain the figures on my Balance sheet?

Or point to documentation for each of these? Let’s say I have the following balance figures (scaled down from actual numbers):

RegT Buying Power			$74
Day Trading Buying Power	$0
Effective Buying Power		$74
Cash Withdrawable			$35
Equity						$74
Long Market Value			$74
Position Market Value		$74
Non-Marginable Buying Power	$35
Initial Margin				$37
Maintenance Margin			$22
SMA							$74

I don’t understand most of these, but the most worrying one, why is Cash Withdrawable less than say Position Market Value?

There are no margin positions on my account.


@crontab The value isn’t shown, but from the other values, it seems it is $0 (or about that amount)? Also, it’s a bit misleading to use ‘scaled down’ numbers primarily because regT margin is 1x if the account.equity is less than $2000. From the values shown the regT margin is 2x so the actual account.equity must be over $2000.

But with those things in mind, here are a few definitions/calculations which my help.

equity = cash + position_market_value

Equity is basically the cash one would have if they liquidated all their holdings and paid off anything borrowed on margin. So, it seems in this case these are the values

74 = 0 + 74

RegT Buying Power is the amount you have available using ‘RegT margin’ which is defined as

regT_buying_power = (2 x equity) - position_market_value

Basically, brokers will lend you (ie margin) an amount equal to your cash or your holdings (They feel comfortable doing this because they have your cash and/or securities as collateral). Your ‘buying power’ is the amount you have as cash plus the amount the broker is willing to lend you on margin. Therefore, its

regT_buying_power = cash + (amount_to_lend_on_margin)
regT_buying_power = cash + (cash + position_market_value)

equity = cash + position_market_value

we get
regT_buying_power = cash + equity
regT_buying_power = (2 x equity) - position_market_value

I like to think of regT_buying_power as 2 x equity but then you reduce that by what you’ve ‘already bought’ (ie you have used that buying power).

So, it seems in this case these are the values

74 = (2 x 74) - 74

cash_withdrawable = (regT_buying_power / 2) - 2000

The regT_buying_power can be thought of as 2 x available cash. One can buy 2x the amount of securities because of margin. Therefore available cash = regT_buying_power / 2. While one could technically withdraw all this “available cash”, back to the original caveat that an account must maintain $2000 to get margin, $2000 is subtracted from available cash. This is so you don’t withdraw so much that now you don’t get any margin.

So, it seems in this case these are the values (I’m assuming the numbers were scaled by 1000)

cash_withdrawable = (74 / 2) - 2
cash_withdrawable = 37 - 2
cash_withdrawable = 35

That is why cash_withdrawable = 35. It won’t equal position_market_value because you can’t keep your whole position and also withdraw an equal amount of cash. Think of it conceptually in steps

  1. sell entire position $74
  2. withdraw the $74 (but now you don’t have any cash left to buy back the position)

That won’t work. Conceptually, this is how it would work

  1. sell entire position $74
  2. use $37 to buy back the original $74 (leaves $37)
  3. withdraw $35 (leave $2 or $2000 to ensure you can buy on margin)

Now, all that said, cash_withdrawable is a bit more complicated and can be less than that amount. It is also reduced by other factors such as accrued fees (eg margin interest and reg fees), any unsettled cash (stock sales take 1 day to settle), and holds on recent deposits (deposits are held for 6 days before they can be withdrawn).

Hope that makes it a bit more clear?

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It’s a bit more clear, thanks a lot Dan!

One more question: in my Settings I had Max Margin Multiplier equal 4. Once I change it to 1, cash_withdrawable becomes 0. What you explained seems to imply a multiplier of 2, however my Balance numbers are the same for both 2 and 4. Why is that?

@crontab The Max Margin Multiplier simply sets the maximum margin. It does not increase the margin. Since the account equity is below $25,000 the maximum margin will be 2x (regardless of the Max Margin Multiplier setting).

If you set the Max Margin Multiplier to 1, cash_withdrawable simply becomes the account cash (or technically settled_cash). Since it appears your cash is $0, the cash_withdrawable becomes $0.

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