Interactive Investor - use pending cash for new trades

Pat38493

I was under the impression that I have to wait for cash from any sales to settle before I can use that cash to buy a new investment.

However I am making some movements around this week, and I noticed that II seems to be using "pending" cash to pay for my purchases.

Have I misunderstood how this works? Maybe it will let me use pending cash if the settlement date is on the same date or earlier than the settlement date for the investment that I am buying?

Linton

Some platforms such as II support the use of pending cash from selling investments, some (from memory BestInvest) may not. It works simply because there are n days for your buyer to come up with the cash but generally you dont have to pay for your purchase for the same n days. There may be a short mismatch but if so, I believe it is covered by the platform. It hasn't caused problems in my experience.

However they wont let you withdraw the money until the transactions have been settled.