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Reserving cash and stock for active Limit & stop-loss orders
Reserving cash and stock for active Limit & stop-loss orders
Ben Tivadar avatar
Written by Ben Tivadar
Updated over a week ago

When placing a limit order or a stop loss on the Freetrade app, we’re required to reserve either cash (for buy orders) or stock (for sell orders) to ensure that we’re able to process the orders you requested.

For example;

UK buy orders

We’ll reserve the cash amount equivalent to the number of shares you would like to purchase at the price you have requested to purchase.

US buy orders

We’ll reserve an additional 10% buffer on top of the calculated cash amount required for your order to allow for any sudden FX movements.

UK and US sell orders

After creating a limit order, we’ll reserve the specific amount of shares that you’ve requested to sell.

Important to note: when cash or stock is reserved, it cannot be used against other orders. To release reserved cash to use for other orders, you will need to cancel any active limit buy orders. Similarly, if you have any active limit or stop-loss orders and you want to sell immediately, you will need to cancel any active orders that are reserving these shares.

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