searchIcon
investing

Understanding your account balances

Understanding your balances is key to managing a successful portfolio. The Balances tab allows you to conveniently track and manage your money.

On the ‘Balances’ tab within the trading platforms, you can view your cash in both CAD and USD, check the market value of your investments, and much more. Feel free to check out our balances video here.

To view your balances, log in to your account, and navigate to the web-trading platform. If you’re not on the trading platform after logging in, click “Accounts” from the top left navigation menu, then “Trading”.

By default, your homepage within the trading platform will be your balances tab on the account page.

Understanding-Your-Account-Balances_Graphic_1

 

  1. Here you can navigate through the different pages on the trading platform.
  2. Within the “Account” page, there’s 5 tabs to choose from:
    • Balances
    • Positions
    • Orders
    • Executions
    • Activity
  3. This is the ‘gadgets’ widget, which is fully customizable. You can also view your balances here.

Next, let’s quickly go over our P&L figures near the top of the page

Understanding-Your-Account-Balances_Graphic_2

Open P&L represents the total ‘unrealized’ profits and losses in this specific account shown in Canadian and U.S. Dollars.

Unrealized means that these profits or losses have not been ‘locked in’ and you still own the investment(s). 

% P&L Day: Your total daily (since market open) profit or loss represented as a percentage. 

Now, onto reading the balances table itself

  1. This button allows you to switch between viewing your current and start of day balances.
  2. These are your balances represented in each currency: CAD & USD.
  3. All in CAD, and All in USD are the approximate values if you were to convert to a single currency. Understanding-Your-Account-Balances_Graphic_3
  4. Total Equity represents the market value of your investments + your cash
    • This is shown as a separate CAD & USD balance
    • And is also shown as an approximate value, if you converted to a single currency under “All in CAD/USD”
  5. Cash simply shows how much liquid, or available cash you have
  6. Market Value represents the current value of all your investments
    • The CAD and USD columns represent separate investments in each currency
    • The All in CAD/USD columns represent the approximate value if you converted to a single currency.
  7. Maintenance excess only applies to Margin accounts, and shows how much ‘excess margin’ you have in the account.

    We’ll cover this in more detail in the section below. In a registered account, your maintenance excess is equal to your cash.

  8. Buying power also only applies to Margin accounts. This represents the amount of money you could theoretically borrow from Questrade to trade or invest with in your Margin account. In a registered account, your buying power is equal to your cash.

    We’ll also cover this in more detail below.

  • SwitchArrow Maintenance excess explained

    Maintenance excess only applies to margin accounts. You are still shown a maintenance excess figure for registered accounts, but it will always equal your cash balance(s) since you cannot ‘borrow’ or leverage in registered accounts. This figure represents the amount of available equity in your account that you can borrow against. You can think of maintenance excess as the amount of excess margin you have available to trade with.

    Your maintenance excess values show how ‘close’ you are to a margin call. A Margin call is when the value of your borrowed investments + available cash is less than the required equity (used as collateral for the loan) in the account. This is when your maintenance excess is less than $0.

    You can calculate your maintenance excess manually if you’d like, it’s your cash plus the value of your investments minus the maintenance/margin requirements. 

    Here’s the formula: Maintenance excess = Total equity (Cash+Market Value of investments) - Margin requirements (Market Value of investments*Margin requirement)

    You can view the specific margin requirement or M.R. for each investment in the “Level 1” quote window on the trading platforms.

    Here’s a great guide that goes into more detail.

    And here’s a few examples:

    Example 1:

    You deposit $10,000 CAD cash to your new margin account, and have not made a trade yet. Your cash equals $10k, market value is $0, therefore your maintenance excess is equal to your cash at $10,000 CAD.

    Example 2:

    With your $10,000 deposit from earlier, you buy $20,000 of stock ABC with a margin requirement of 30%. 

    Your cash balance now equals -$10,000, and the market value of your investments equal $20,000. Therefore your total equity is still $10,000.

    The margin requirements are $20,000 * 30% equaling $6,000. 

    We subtract the margin requirement from your equity, therefore your maintenance excess is now $4,000.

    Example 3:

    Continuing from the earlier scenario, your $20,000 investment unexpectedly declines in value by 10% to $18,000.

    Your cash balance is still -$10,000, but now your total equity is $8,000. Your margin requirement is $18,000 * 30% = $5,400.

    Therefore, your maintenance excess is now only $2,600.

    Example 4:

    With some bad earnings news, your $18,000 investment from the earlier example declines in value by another 25% to $13,500.

    Your cash balance remains unchanged at -$10,000, but now your equity is $3,500. Your margin requirement is $13,500 * 30% = $4,050.

    Therefore, your maintenance excess is now -$550, and you are in a margin call, and need to deposit funds, or sell shares to bring this value up to a positive amount. 

    These examples also highlight the consequences of leverage (borrowing) while trading. In these scenarios, because we leveraged our cash by 2x to purchase the initial investment, our losses were magnified 2x. With a -10% decline in share price, your account would be down -20%. This does however go both ways, with a +10% gain, your account would be up +20%.

  • SwitchArrow Buying power explained

    Your buying power represents the possible maximum amount you could borrow from Questrade to trade and invest with. The buying power is calculated using a 30% margin requirement - the lowest possible requirement as per IIROC regulations. 

    Your buying power is your maintenance excess multiplied by 3.333 (Representing a 30% margin requirement).

    Therefore if your maintenance excess is $1,000, your maximum buying power is $3,333.

    Please note: Because every specific investment may have a different margin requirement, your buying power shown may not actually be the maximum amount you could purchase of a specific investment. For securities with a 100% margin requirement for example (common for OTC stocks), your buying power equals your cash since you cannot borrow to buy that security.

    You can view the margin requirement for any security in the ‘Level 1’ quote window.

    In addition: Please use caution when investing the full amount of your buying power to purchase on margin. For example, if you ‘maxed out’ your buying power and borrowed heavily to invest, your maintenance excess could be very close to $0. If your investment declines in value by any amount, you’d immediately be in a margin call. Please see the section above for more details.

You may want to check this out

Need more help?

The information contained in this website is for information 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.

Questrade Wealth Management Inc. (QWM) and Questrade, Inc. are wholly owned subsidiaries of Questrade Financial Group Inc. Questrade, Inc. is a registered investment dealer, a member of the Investment Industry Regulatory Organization of Canada (IIROC) and a member of the Canadian Investor Protection Fund (CIPF), the benefits of which are limited to the activities undertaken by Questrade, Inc. QWM is not a member of IIROC or the CIPF.

© 2021, Questrade, Inc. All Rights Reserved.