Go to Jeff Salisbury LWGate Home Page.From: "Jerome Buckmelter" <jsjbuck@myexcel.com>
Subject: [CANSLIM] New trading restrictions
Date: Sun, 16 Mar 2003 13:20:58 -0800
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Tom Worley,
Thank you for your input. I followed your advice, and called Ameritrade
requesting that they email me the new rule. It is attached. This is a
"canned" response: It says, "Our records indicate that you have recently
sold securities in your account prior to making full cash payment." even
though I am a new Ameritrade customer and have never placed any orders
with them yet. In contrast to my earlier discussions with Ameritrade,
this new ruling does not appear to be from the NASD as they claimed, but
rather from the staff of the Board of Governors of the Federal Reserve
System as they now claim per the attachment. This "new rule" is further
disturbing since the only alternative is to have a margin account which
is not, according to the attachment, permitted for IRA's and custodial
accounts. This could be devastating for us who are using the canslim
system to build our retirement account. We will be forced to keep a
large portion of our account in cash during a bull market in
anticipation of a break out or we could be fully invested and miss every
breakout by three days, after the sale settles. I guess the main
questions are: is this just an Ameritrade internal policy as you
suspected? Will other brokerages follow suit? What do you -- and the
other canslimers -- think should be done about this onerous restriction?
Again, Tom, thanks for all your help. Jerome
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<p class=3DMsoNormal><font size=3D2 face=3DArial><span =
style=3D'font-size:10.0pt;
font-family:Arial'>Tom Worley,<o:p></o:p></span></font></p>
<p class=3DMsoNormal><font size=3D2 face=3DArial><span =
style=3D'font-size:10.0pt;
font-family:Arial'>Thank you for your input.<span
style=3D'mso-spacerun:yes'> </span>I followed your advice, and =
called
Ameritrade requesting that they email me the new rule.<span
style=3D'mso-spacerun:yes'> </span>It is attached.<span
style=3D'mso-spacerun:yes'> </span>This is a “canned” =
response:
It says<span class=3DGramE>,</span> “Our records indicate that you =
have
recently sold securities in your account prior to making full cash =
payment…”
even though I am a new Ameritrade customer and have never placed any =
orders
with them yet. <span style=3D'mso-spacerun:yes'> </span>In =
contrast to
my earlier discussions with Ameritrade, this new ruling does not appear =
to be
from the NASD as they claimed, but rather from the staff of the Board of
Governors of the Federal Reserve System as they now claim per the
attachment.<span style=3D'mso-spacerun:yes'> </span>This =
“new rule”
is further disturbing since the only alternative is to have a margin =
account
which is not, according to the attachment, permitted for IRA’s and =
custodial
accounts.<span style=3D'mso-spacerun:yes'> </span>This could be =
devastating
for us who are using the <span class=3DSpellE>canslim</span> system to =
build our
retirement account.<span style=3D'mso-spacerun:yes'> </span>We =
will be
forced to keep a large portion of our account in cash during a bull =
market in
anticipation of a break out or we could be fully invested and miss every
breakout by three days, after the sale settles.<span
style=3D'mso-spacerun:yes'> </span>I guess the main questions =
are:<span
style=3D'mso-spacerun:yes'> </span>is this just an Ameritrade =
internal
policy as you suspected? <span =
style=3D'mso-spacerun:yes'> </span>Will
other brokerages follow suit?<span style=3D'mso-spacerun:yes'> =
</span>What
do you -- and the other <span class=3DSpellE>canslimers</span> -- think =
should be
done about this onerous restriction?<span =
style=3D'mso-spacerun:yes'>
</span>Again, <span class=3DGramE>Tom,</span> thanks for all your help. =
<span
style=3D'mso-spacerun:yes'> </span>Jerome <span
style=3D'mso-spacerun:yes'> </span><span
style=3D'mso-spacerun:yes'> </span><span
style=3D'mso-spacerun:yes'> </span><o:p></o:p></span></font></p>
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From: Ameritrade New Accounts [starting@ameritrade.com]
Sent: Sunday, March 16, 2003 11:58 AM
To: jsjbuck@myexcel.com
Subject: Cash Account Restrictions
Dear Valued Client:=20
We are contacting you to explain how recent regulatory guidance we =
received related to cash accounts will impact your trading activity.=20
RESTRICTIONS IN CASH ACCOUNTS
Under applicable interpretations issued by the staff of the Board of =
Governors of the Federal Reserve System, cash account clients are =
prohibited from making a practice of selling securities without having =
paid for their purchase with "cash" available in their account. "Cash" =
includes existing cash in the account, the proceeds of settled sales of =
fully-paid for securities, and additional cash deposits. Proceeds of a =
sale may not be included as "cash" before the settlement date - which is =
generally three business days.=20
WHAT DO THESE RESTRICTIONS MEAN FOR YOU?
Our records indicate that you have recently sold securities in your =
account prior to making full cash payment for those securities as =
defined above. As a result, effective immediately, a restriction has =
been placed on your Ameritrade account. This restriction limits your =
purchases to the "cash" in your account at the time of your trade. In =
addition, all opening transactions will be reviewed to determine if =
settled cash is available for the trade.=20
If you choose to continue trading on funds prior to settlement, =
depending on circumstance, you may:=20
Add funds to your cash account; or=20
Convert to a margin account. An Account Modification form is needed in =
order to add margin approval to your account. (Certain account types are =
not allowed margin - including IRA and Custodial Accounts.)=20
If you have any questions, please e-mail us at =
clientservices@ameritrade.com or contact us at 800-669-3900.=20
We appreciate your patience and recognize that this restriction may =
cause you some inconvenience. We will do our best to serve you during =
this time - and thank you for your continued business.=20
Sincerely,
Sherri Adkins
Ameritrade Client Services
* Additional restrictions may apply. Margin trading is not suitable for =
all investors. Please consult the Ameritrade Margin Handbook for =
additional details.=20
Ameritrade, Inc., Member NASD/SIPC Ameritrade and Ameritrade logo are =
trademarks or registered trademarks of Ameritrade IP Company, Inc. Used =
with permission. =A9 2003 Ameritrade IP Company. All rights reserved. =20
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Next Article (by Author): Re: [CANSLIM] New trading restrictions "Tom Worley"
Previous Article (by Author): [CANSLIM] OVTI FWIW Eric Jaenike
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Next in Thread: Re: [CANSLIM] New trading restrictions "Tom Worley"
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