Re-using margin multiple times per day

Alpaca Trading
1

I have a balance of under 2000 and I wish to re-invest the proceeds from stock sales straight away. As I understand it, all accounts are margin accounts, so it is treated as T+0 settlement. But can I re-use that margin multiple times? Here is an example.

I have a balance of 500
I buy a stock at 400, my balance is now 100
I sell. the stock for 450, my balance available to trade is now 550

I repeat the process: I buy stock at 400, my balance is now 150
I sell the stock for 450, my balance is now 600

I repeat the process again: I buy stock at 400, my balance is now 200
I sell the stock for 450, my balance is now 650

Can I continue to re-use the balance from sold assets on the same day? this is all day trading, no positions held open overnight, no need to withdraw until properly settled.

2

@antonypenn Since the equity in your account is less than $2000 you do not get any regT margin. However all accounts, regardless of equity, have what is termed “limited margin” available to them. So yes, you are correct that you can immediately use the proceeds from any sales without waiting T+1. You can do that as often as you wish. You are not really reusing that margin, rather your equity and available cash are calculated real time. You can use proceeds from sales immediately.

I’m sure you are aware, but while you can buy and sell as many stocks as often as you wish, there are restrictions on day trading. Buying then selling the same stock during the day is a "day trade”. If the equity in one’s account is less than $25,000, the account is restricted to only three day trades during a rolling five day window. See here for more details.

3

Hi Dan, Thanks for the info. yes I quickly realised that this falls into the PDT rules. Its useful to know that I can re-invest multiple times a day on a margin account, though its pretty useless to me until the PDT changes come in or I can get my working equity level up. Unfortunately my system requires 10-30 trades a day, so I will need to use a cash account elsewhere and/or consider alternative stock markets for the interim