ACH transfers

Posted by uiucfinance on July 01, 2008 (11:30AM)

How long of a holding period on ACF transfers can I expect after the initial deposit?  5 business days after the initial deposit seems a bit drastic.

I appreciate your help. 

 

Posted by uiucfinance on July 01, 2008 (11:44AM)

I read the blog about ACH transfers, and understand that the time for deposits to show up will shorten as your relationship grows.  However, I had a confusing moment today.  I made an ACH deposit yesterday, and the funds showed up this morning.  The funds were uncleared, but still they showed up in my account.  I thought from previous experience you can purchase using these funds, but you must hold the position until the deposit clear.  So this afternoon I tried placing a limit order, and the trade status page said "open".  I then decided to change my limit, and put the order through again.  This time on the trade status screen it came up with an error stating I have to wait for funds to clear.  Did the system double count my limit orders?  (i.e. it thinks the funds are going to be used by the initial, although canceled, limit order).  Has anybody else had an experience as such?

 

 

Posted by Venturer on July 01, 2008 (07:29PM)

I have also had unexpected experiences in the way that posting happens. As a matter of fact, I bought an Ultra-Short ETF and a Short Mutual Fund just yesterday night (June 30th), and tonight (July 1st) I am showing an "executed status" on the ETF and a "pending" status" on the mutual fund. Both the ETF and the mutual fund are shown in my "Holdings" view, but neither is shown in my "Unrealized Gains and Losses" view. Kinda makes me wonder where my money is for 24 hours (ESPECIALLY in a BEAR market and these are both "market shorts"...

Posted by Chris L on July 02, 2008 (09:44AM)

Hey uiucfinance and Venturer...

Let's see if we can clear up both of your questions.

All ACH deposits will have a five business day hold placed on them.  This hold will always be displayed on your balances page as "Uncleared" funds.  When you make a deposit for less than your account's value, we will likely let you use those funds immediately despite showing as "Uncleared" on your balances page.  You simply just need to try placing a trade.  Instances where we would not allow you to use "Uncleared" fund early is for the purchase of penny stocks, OTC BB/Pink Sheets, and IPO's.  When your deposit is for more than your account's balance, we will sometimes let you use a portion of your funds up to your account's value at the time of the deposit.  Initial funding will always have to wait the full five business days because of the $0 account value.  There is also no rule stating that if you use an uncleared deposit to purchase a security you must hold it until the funds clear. You are confusing Reg. T trade settlement rules with our in house ACH clearing rules.

Venturer...The Gain/Loss Unrealized page always takes overnight to update with newly acquired positions, while the holdings and activity pages update immediately. This is likely why you did not see anything on your G/L unrealized page until today. Your mutual fund trade showed pending through the 1st because you place it on the evening of the 30th and it will not execute until the new NAV for your fund is computed after the close on the 1st.  Because of this you will typically not see the execution of your mutual fund trade until after 6 PM of the trading session in which your order is set to execute.  Please always remember that once you see a trade on your activity page, it has taken place and funds have been adjusted in your account to reflect the new positions.  Also keep in mind that your Gain/Loss Unrealized page will always take overnight to update with any new information.

Thank you both for your questions and if you have any more, let us know.

Chris Lebhar
TradeKing Customer Service Representative

Posted by uiucfinance on July 03, 2008 (02:44AM)

Thanks Chris for your explanation.

 

However, I would like to voice my concern.  You say "all you have to do is trade", to check to see if the uncleared funds are usable, this is a pretty shot in the dark type of an approach to this.  Especially since if I make a large ACH deposit, and only a portion of the funds are available. There is no way of using up the maximum amount of available funds for a trade.  (I guess you could ratchet up your amount of shares and see if the trade gets rejected at preview?)

 

I would like to see in the future, a breakdown of uncleared funds into available and unavailable.

 

Again, right now, I feel the situation is pretty vague, especially since it seems there are no set rules, and decisions are made per account on a discretionary basis. 

Posted by RetireOnTime on July 03, 2008 (05:23AM)

I think the hard and fast rule is "uncleared funds aren't available".  Chris is saying, if you want to try anyways, you might be able to do it, but that's not a standard feature.

Posted by uiucfinance on July 03, 2008 (07:21AM)

You are right.  I should take that just a 100% fact.  I just get a little excited sometimes!

 

 

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