One of the things that elude people the most when it comes to Webull is what cash balance is and how it differs from the other components that make up your account’s net value.
Below are answers to 7 questions meant to help clear it up for you.
Different factors could affect the availability of your cash balance, whether to be used for trade or to be withdrawn and transferred to your bank account.
The Webull website outlines four possible reasons:
While related, cash balance and buying power have subtle differences.
Cash balance refers to the actual amount of real money you have deposited into your Webull account. On the other hand, buying power is the maximum dollar amount available for placing trades.
The value of your buying power can be your cash balance, but it could also be multiplied by leverages (specifically on margin accounts). Both are affected by whether or not you’re using “borrowed money” to trade.
For example, if you make an initial deposit of $5,000, then that amount, once settled, is your cash balance. If done on a margin account, this typically allows you to initially borrow up to 50% of the cost of the securities you want to purchase.
This means that your buying power can be doubled, and you now have an extra $5000 to trade with, which is one of the benefits of having a margin account. This added feature clearly distinguishes cash balance from buying power.
The simple, straightforward answer to this question is yes.
You can withdraw your cash balance from Webull.
Just take note of the factors that could affect their availability, which has been addressed in an earlier question.
Your cash balance will appear negative if the deposit you have made hasn’t settled and you are trading on provisional credit.
Again, this means that you are borrowing money from Webull to trade. Provisional credit is free of charge in cash accounts.
Similarly, any stocks you purchase on a margin account could appear as a negative balance if you’re not trading using your actual cash balance or settled funds.
In most cases, a negative cash balance just fixes itself once your deposit settles. What happens is that the negative balance is automatically deducted or debited from your deposit amount.
Sometimes, when trading on margin, it could be that the profits you’ve made are enough to cover the negative balance. Normally, however, Webull does charge interest on margin accounts, which is one way they earn money.
Sadly, no. Because your withdrawable cash is incorporated within your cash balance, it’s not possible to take any of it out of your Webull account if it’s in the negative. You must wait for certain funds to settle first before attempting to initiate a withdrawal.
It depends on the source of the funds or where they’re coming from. If you deposited money via ACH, it could take up to 4 business days to settle. Domestic wires take two business days if it’s via wire transfer, and international wires can take up to 5 business days.
If you’re talking about proceeds from stocks, it’s still T+2 or the trading day plus two business days.