When is my account borrowing cash?

Margin accounts allow investors access to borrow cash to hold their positions. A quick way to determine if your account is on margin or borrowing cash is by referring to your cash balance.

A (negative) cash balance = Being on margin

Check your cash balance to see if your account is on margin (or borrowing money). You can view your cash balance by clicking the blue Balances dropdown immediately to the right of your account number. When your cash balance is negative (in parenthesis), your account is on margin and borrowing cash to hold your portfolio's positions.

It is important to note that unrealized short equity options positions, such as single-leg short options or credit spreads, can offset a negative cash balance and prevent margin debit interest. Moreover, while proceeds from unrealized short stock sales and short options on futures premiums can offset a negative cash balance displayed on the platform, it does not offset a margin debit balance.

Cash Sweeps with Futures and Cryptocurrency Positions

Trading futures or cryptocurrencies can cause your margin account to go on margin due to a cash sweep between your securities account that holds your stock and options positions and your futures or cryptocurrency account. In short, this occurs because separate account(s) hold futures and cryptocurrency positions in the background. Please click here to learn more about the separation of accounts at tastytrade.

An example of an account on margin

Accounts on margin are assessed interest daily (including on weekends and holidays) and charged monthly (mid-month). In the example below, the account has a negative cash balance of $16,991.67 to hold its stock position on margin, but the same can occur after a cash sweep. Please click here to learn how to calculate a margin debit balance.