Funding Facts, a/k/a Show Me the Money!

Funding Facts Once you’ve done your research and made the decision to open a new brokerage account, you may want to start buying and selling right away. Similarly, if something comes up requiring quick access to liquid capital, you may want to withdraw some of your available cash. Policies put in place by clearing firms and brokerages, however, require investors to be a bit patient, regardless of which brokerage firm they choose to use. Here is a brief reminder of the rules and regulations in place at OptionsHouse. Note that the holding times can be different depending on the funding method; a bank wire provides the quickest access to your funds but typically has a processing fee associated with it.

Holding Period for Deposits

For the security of the brokerage and the investor, OptionsHouse holds all checks and ACH (Automated Clearing House) deposits for three days until the funds are available for trading. For example, if funds are deposited via check or ACH on Monday, they would be available for trading on Thursday morning.

Funds received directly from a bank wire are available for trading the business day after they are received. Finally, funds received via wire can be posted the same day if requested by the customer by contacting customer service. Note that wired funds requested for same-day posting cannot be day-traded (for more information on what constitutes a “day trade,” refer to this article).

Holding Period for Withdrawals

Available cash requested via ACH must be held for the deposit day plus five business days before they can be withdrawn. For example, funds first deposited via ACH on Monday, August 2, can be withdrawn on Tuesday, August 10. Funds received via check must be held for the deposit day plus 10 business days before they can be withdrawn (so funds first deposited via check on Monday, August 2 could be withdrawn on Tuesday, August 17). Finally, funds deposited via a bank wire can be withdrawn the next business day. These holding periods apply to cash in the account and not to funds settled through a closed stock or option position.

Photo Credit: GenBug

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