A margin account allows you to borrow cash from Firstrade to purchase securities. The loan in the account is collateralized by the securities you purchase. You may also trade in a margin account with your own cash. No extra interest or fees will be charged if you do not borrow money from Firstrade or exceed your cash buying power. Trading in a margin account would allow you to use unsettled funds; this would avoid all the settlement date-related violations that could happen in a cash account.
While you hold securities using margin, if the value of the stock drops significantly, the account holder will be required to deposit more cash, more marginable securities, or sell a portion of the securities to maintain the minimum margin requirements.
Note - Firstrade does not support Portfolio Margin.
Important Notice - When margin privileges are approved on your account, full margin and day trading functionality may not be available until the following business day. While your account may reflect an active margin status on the day of approval, day trading permissions may not be fully established.
For this reason, please refrain from placing day trades on the day your margin privileges are approved. If you have already opened a position and are unable to close it through the platform, please contact Customer Service immediately — a broker will be able to assist you in closing the position.
Credit Verification - You authorize Firstrade to obtain a consumer credit report at the time of your application to assess your creditworthiness and, as needed, to obtain additional reports periodically for updates, renewals, extensions, or collection activities on any approved account. Based on the information in these credit reports, Firstrade reserves the right to deny your application if negative information is identified. Additionally, Firstrade may, at its discretion and for its own protection, request and obtain a consumer credit report at any time if deemed necessary.