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To: Ed Forrest who wrote (5272)	2/10/1998 11:32:00 PM
From: Susan Saline	Read Replies (2) \| Respond to of 120523

Ed, is it a margin account? must be a margin to do that, unless you have enough funds to cover another trade. Sue

To: Ed Forrest who wrote (5272)	2/11/1998 7:45:00 AM
From: Ron McKinnon	Read Replies (1) \| Respond to of 120523

Ed, let me toss out a few thoughts on "buying power" You said >>>>Life has more than enough foolish rules.I can just say no to this one. As foolish as the "rules" may seem to us they are real, very strict, and expose you to severe restrictions if you break them; so I am not sure that you can just say "no". I can not give you chapter and verse but can give some general comments. Others may be able to give more specific details than I can. Various rules are set by the SEC, the stock exchanges, and by each brokerage house. You need to be concerned with two catargories. Buying power, ie, how much stock you can buy in a given day Day trading limits, ie, how much you can buy and sell during the day There are two types of accounts Cash Margin In a cash account your are basically limited to buying new stocks up to the amount of cash credit in your account at the beginning of the day. For purchases that are going to be held overnight you can add to this the proceeds from stock sold during the day. But, for day trades you can not add sale proceeds. All purchases must be settled on the settlement date (3 days after purchase) An attempt to settle with the use of day trade proceeds is not allowed; if you try to do that you have violated the so called "free riding" rule and the broker will slap you with a 90 day trading restriction. Strangly enough, this restriction does not seem to apply to IRA accounts, but I have no idea why> In a margin account you will begin the day with some amount of "Buying Power", which should be clearly spelled out in your account. This is the amount you can use to purchase stock on a givin day. It is basically calculated using the "50%" margin rule (which is set by the Feds). For daytrading you are subject to that buying power but in addition there is a limit on how much stock you can buy and sell during the same day. This is usually less than your "buying power". There is a formula for calculating this but your brokerage account should calculate it for you each day. Ask your broker where this figure is and what they call it. Typically it will be called "NY Surplus" or something like that. Your avalibility for day trades is TWICE that figure. Again, if you exceed these limits you will get hit with severe restrictions. My suggestion would be to call your existing broker and go over each example, step by step, asking very specific questions. You may be better speaking with the "back-shop" people (margin clerks) than with a broker/trader. Ask the same questions of any other broker you may be thinking of switching to. I hope that this helps a bit and maybe others can offer additional details or corrections to what I have said here.