Trade with a Margin account?
You may be interested in a vital metric now available known as Real-Time Buying Power (RTBP), which can monitor your buying power and help you avoid Margin calls.
Lesson Balances and Reports
Real Time Buying Power
Monitor your buying power or excess margin with real-time streaming to help avoid margin calls.
RTBP is currently available in our Questrade Edge Desktop, and Edge Web platforms and only appears for Margin accounts.
What is Buying power and how does it work?
You can think of Buying Power (also referred to as margin/maintenance excess or excess margin) as the amount of margin you have available to trade with.
This value shows how ‘close’ you are to a Margin call.
A Margin call is when the value of your borrowed investments plus available cash is less than the required equity (used as collateral for the loan) in the account.
This is when your Buying power is negative (less than $0).
Note: Buying power (BP) only applies to Margin accounts. You’re still shown a Buying power figure in your balances for Registered accounts, but your BP will equal your cash balance(s) since you cannot ‘borrow’ or leverage in registered accounts.
Learn more about how Buying power is calculated in our dedicated article.
RTBP vs Buying power
If you’re comparing the balances shown under the Account > Balances page and the RTBP figures shown under Account > Positions, you may notice some differences between these values.
The Buying power and Max Buying power values that are shown on your Balances page will generally only update after placing an order. These balances generally do not update in real-time as your position's market price changes.
The RTBP shown under Positions, however, will update and stream in real-time depending on the market value of your positions (or strategies). Therefore, if you’re trading with leverage and borrowing funds to invest, it’s important to refer to your RTBP for the most up-to-date values.
Important note: RTBP is for informational purposes only and is not used to determine whether an order will be accepted. It is a tool to monitor the buying power in your account based on real time trading prices.
For example: If your account started the day in a margin call but the market moved in your favor, you can use RTBP to see if your account is still in a margin call based on current trading prices.
Remember: If your RTBP is negative, that means you are currently in a Margin call, and you may need to take action to bring your balances back to positive by making a deposit or closing positions.
RTBP in Edge Web
When using our advanced Edge Web platform, your combined Real-Time Buying Power will be visible at the top of the Account page, under the Positions tab.
Note: Securities shown are for illustrative, educational, and visual purposes only, and should not be relied upon as financial advice.
Tip: If you don’t have Edge added yet, log into your account, select the main Accounts menu from the top left, then select All Platforms. From this page, go to the Questrade Edge tab, and select the green Add Questrade Edge button.
Your RTBP is shown on the top right-hand side of the Positions tab, next to the edit columns button. This is shown as an “All in CAD” or “Combined CAD” value by default, but can be changed using the drop-down menu selector.
You’re able to view your Real-Time Buying Power as “All in CAD” or “All in USD”. This gives you more flexibility over your trading and helps you customize your view depending on the currency of the stocks you trade more often.
- Positive RTBP values are shown in black, and represent how much additional (extra) buying power you have in your account compared to the overall margin required.
- Negative RTBP values are shown in red, and represent when you’re in a Margin call.
Tip: In a Margin call? Explore our various funding options, including Instant deposit which can help you cover the Margin call in minutes.
Interested in diving deeper into the buying power required for each individual position?
Edge Desktop supports custom columns on the Positions page, which can show the RTBP per individual position (or grouped options strategy).
RTBP in Edge Desktop
Real-Time Buying Power is also available in our advanced Edge Desktop platform, both at the combined level for your entire account, and also at the individual position/strategy level.
To view your combined RTBP in Edge Desktop, open the Account widget, and select the Summary or Positions tabs. Your RTBP will be visible on the right hand side of the window next to your P&L figures.
You can switch between “All in CAD” or “All in USD”, which shows your combined RTBP for the specific Margin account you’re viewing.
Note: Securities shown are for illustrative, educational, and visual purposes only, and should not be relied upon as financial advice.
Because your Buying power is per account, there is no “combined all accounts” view for this value. Even if you hold multiple Margin accounts, these figures are calculated on a per account basis.
RTBP req ($) per position or strategy
If you trade with multiple positions (or strategies) in your margin account at the same time, you may find the custom columns features of Edge Desktop incredibly useful. Make sure you display positions by strategy to see the columns below.
Use the Edit columns button after right-clicking your tables in the Account widget to add additional information such as RTBP req ($) to your Summary or Positions tabs.
Simply toggle the additional data columns you’d like to add under the Summary or Positions tabs.
Remember: You can customize each tab to show different amounts of data in whatever order you’d like. After you add your preferred information, you can even save this as your new default.
This additional column of information will show the amount of Buying power that is required for each individual position or strategy you hold.
This can be very helpful in identifying how much buying power your positions are utilizing - especially during times of high volatility.
Watchouts and Tips
While Real-Time Buying Power (RTBP) provides you with invaluable real-time data, it's crucial to approach margin trading with caution.
Dive into the section below for need-to-know information, and to ensure you're getting the most out of RTBP without inadvertently taking on undue risks.
- RTBP values are based on the Bids of the securities for long positions
- RTBP values are based on the Asks of the securities for short positions
- Some securities may trade with wide Bid-Ask spreads, which may affect the value you are shown for your RTBP
- During increased volatility, it’s important to monitor your RTBP carefully as the value will fluctuate rapidly as the prices of securities rise or fall
- Remember to monitor the values shown in your Trade confirmations before placing orders to make sure you don’t accidentally enter a position that will put you into a Margin call
- If the margin requirements change for one of the securities you own/owe, this may impact the amount of Buying power that is necessary to maintain that position
Note: The information in this blog is for educational purposes only and should not be used or construed as financial or investment advice by any individual. Information obtained from third parties is believed to be reliable, but no representations or warranty, expressed or implied, is made by Questrade, Inc., its affiliates or any other person to its accuracy.
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