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This confused me at least: do people keep cash in their brokerage accounts? Is this an American thing (limey Brit here).

I transfer cash in once I've decided to trade and the brokerage usually holds it for a max of a day or two until the trade actually executes (say I am buying an index fund where orders today are executed tomorrow). The only time there has been cash for longer than that was when I know I needed it (a week or two before buying my first place) so I didn't want to risk a stock market crash etc.



In the US, settlement is T+2, so if you are buying, the broker doesn't pay the cash/receive the shares until two days later, but they won't let you buy without cash in your account first, so cash for unsettled trades is a bunch of float.


I am keeping some cash in my Vanguard account because it's offering a better interest rate than my cash ISA.


> do people keep cash in their brokerage accounts?

Some people use a brokerage account as a checking account. Most don’t. Interest can also be earned on lent securities.




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