Question about selling stocks

[TheBDB]

If I purchase stock it takes 3 days for it to settle. If I sell it before it settles is there a penalty? Or is there a penalty if I sell it before it settles and then use that money to buy more? Basically I was reading about short selling and wasn't sure if this is what is was talking about. It mentioned selling stock that was borrowed, and I wasn't sure if that applied to stock that hadn't settled yet.

 

[JS80]

Intraday 3x is day trader and you'll need to deposit $25k. Best way is to wait until the next day to buy stock.

 

[Delita]

My answer to you is: give your money to someone who knows what they are doing with it.

 

[alien42]

depends on your broker but typically the 'penalty' is that your money is locked up for a few days if you sell before the buy settles.

 

[DaveSimmons]

Buy and hold stock index mutual funds, you'll lose a lot less

 

[her209]

If I purchase stock it takes 3 days for it to settle. If I sell it before it settles is there a penalty? Or is there a penalty if I sell it before it settles and then use that money to buy more? Basically I was reading about short selling and wasn't sure if this is what is was talking about. It mentioned selling stock that was borrowed, and I wasn't sure if that applied to stock that hadn't settled yet.

With Scottrade, how I understand it, is that you can use settled funds to buy and sell and buy again within the three day holding period of the first buy; but you can't sell the 2nd buy it until it settles without causing a free-ride.

This is true for all cash accounts regardless of the balance.

 

[blackdogdeek]

what you are talking about is not short selling.

 

[speg]

Your broker will typically allow you to use the cash before it is settled. However, you cannot withdraw cash from your account before it settles.