With a cash account, let’s say someone want to make 1 trade per day, every single day using their full account balance.
Scenario:
$10,000 account
On Monday I sell $10,000 worth of AMZN to purchase $10,000 of AAPL
On Tuesday I sell all shares of AAPL to purchase $10,000 of TSLA
On Wednesday, I sell all TSLA shares to purchase $10,000 of GOOG
In this scenario, I would incur a good faith violation, correct? Because I used the proceeds of a sale to purchase another security and then sold the newly purchased security before the original funds used to make that purchased had settled? Or am I incorrect?