Account Balance
Your account balance is the cash recorded in your account from deposits, withdrawals and closed trades; the available balance is the part you can currently use or withdraw.
Your app shows one number for cash, another for what you can withdraw, and a third for what you can trade with. Knowing which is which keeps you out of rejected orders, frozen accounts and surprise margin calls.
- Category
- Accounting, Tax and Operations
- Reading time
- 4 min
- Also called
- Cash balance, Available balance, Account cash
- Updated
Account balance in plain words
Your balance is the cash recorded in the account. Some of it may simply be uninvested — money you just deposited, or dividends and interest you received.1
Many firms automatically move spare cash into a bank deposit or money market fund through a cash sweep program.1
Cash and investments can sit in the same account at once — say $5,000 in cash next to $10,000 of shares.1
How to read your balance, step by step
Find the cash line
Separate uninvested cash from positions; new deposits and dividends land here first.1
Check where idle cash sits
Ask whether a cash sweep moves it to a bank account or money market fund.1
Know your account type
In a cash account you must pay the full amount for securities you buy.2
Wait for settlement
To buy $1,000 of stock you need $1,000 in cash before the order settles, generally one day later.1
Avoid freeriding
Buying and selling before paying is freeriding, which can get the account frozen for 90 days.2
Deduct fees
Watch for standardized monthly or annual account fees that reduce cash.1
Worked examples
Example 1 — Reading the statement
$5,000 buying power in a cash accountA hypothetical account shows $5,000 cash and $10,000 of stock.
| Cash | $5,000 |
| Stock | $10,000 |
| Total value | $5,000 + $10,000 = $15,000 |
Only the cash part pays for new purchases in a cash account, which requires paying the full amount.2
Example 2 — Closed trade adds to balance
Balance +$145A hypothetical trader starts with $2,000 cash, buys stock for $1,000 and later sells it for $1,150, paying a $5 fee.
| Cash after buy | $2,000 − $1,000 = $1,000 |
| Sale proceeds net of fee | $1,150 − $5 = $1,145 |
| New cash balance | $1,000 + $1,145 = $2,145 |
The proceeds count toward available cash only once the sale settles, generally one day after the order.1
Example 3 — Monthly fee drag
−10% of idle cashA hypothetical $600 idle balance is charged a $5 monthly account fee for a year.
| Fees per year | $5 × 12 = $60 |
| Balance after a year | $600 − $60 = $540 |
Some brokers charge a flat monthly or yearly account fee, which slowly eats into a small balance that is not invested.1
Cash balance vs available balance
| Aspect | Cash balance | Available balance |
|---|---|---|
| What it shows | All cash recorded in the account | Cash you can use or withdraw now |
| Includes unsettled proceeds | Often yes | Usually not until settlement |
| Affected by margin | Not directly | Reduced by margin and holds |
| Use it for | Record-keeping | Deciding what to trade or withdraw |
When account balance matters
Before buying
Make sure enough settled cash is there.
Before withdrawing
Check the available figure, not the total.
Margin accounts
Track how much cash supports open Margin positions.
Reconciling
Match the balance with your Trading Journal and statements.
Advantages and disadvantages
Advantages
- One number tells you how much cash you hold.
- Separating cash from positions clarifies risk.
- Watching it catches fees and errors early.
Disadvantages
- Different apps label balances differently.
- Unsettled proceeds can make cash look available when it is not.
- Margin can make the balance misleading.
- Idle cash may earn little and still pay fees.
Going deeper
Read as far as you need. Each level builds on the one before it.
Cash vs holdings
Beginner
A statement may show $5,000 in cash next to $10,000 in stock; only the cash is your balance.1
Settlement and freeriding
Intermediate
You need cash in place before a buy settles, and selling before paying can freeze the account for 90 days.2
Margin and losses
Advanced
Investing on margin can lose more than you deposited, so a negative balance is possible.1
Common mistakes
Confusing total and cash
Treating portfolio value as withdrawable cash.
Ignoring settlement
Spending sale proceeds before they settle.
Forgetting sweeps
Not checking what interest idle cash earns.
Missing fees
Letting small account fees eat a dormant balance.
Check your understanding
Test yourself before moving on. Each answer comes with an explanation.
Key points to remember
- Balance is cash, not total portfolio value.
- Available balance is what you can use now.
- Settlement affects when proceeds become usable.
- Fees and sweeps change idle cash.
- Margin can push a balance negative.
Frequently asked questions
Why is my available balance lower than my cash balance?
Do unrealized gains add to my balance?
Can my balance go negative?
Further learning
- Settlement
Why proceeds aren't available instantly.
- Realized and Unrealized P&L
Which gains reach your balance.
- Margin
How borrowing changes the picture.
- Trading Fees and Commissions
Costs that reduce cash.
Sources
This article is written in our own words. The sources below support the specific facts, rules and figures marked with a number in the text. Links open the original publisher’s page.
- FINRA. Brokerage Accounts (opens in a new tab) Checked .
- Investor.gov (SEC). Trading in Cash Accounts – Investor Bulletin (opens in a new tab) Checked .
Educational content, not financial advice. Examples use hypothetical prices and simplified costs; actual fees, margin rules and regulations vary by broker, market and country. We are not affiliated with any publisher linked above. Last reviewed . Report an error or request a source credit.