Updated
Can I sell investments while I have an outstanding balance in my Portfolio Line of Credit?
Yes, you can sell investments in the account associated with your Portfolio Line of Credit as long as you maintain sufficient equity. Your Portfolio Line of Credit does not impact the ability to sell investments in your other accounts that are not associated with the margin loan (Stock Investing Account, Retirement Account, etc.)
As long as the following equation is satisfied, you can withdraw funds from your Automated Investing Account (please note that the account balance excludes cash positions, lower volume securities, and holdings in cryptocurrency trusts and the Wealthfront Risk Parity Mutual Fund).
Example
In the following example, the withdrawal would be allowed because the client maintains sufficient equity even after selling investments.
|
Before withdrawal |
After withdrawal |
|
|
Account Balance |
$200,000 |
$130,000 |
|
Outstanding Line of Credit Balance |
$30,000 |
$30,000 |
|
Equity % |
85% |
77% |
|
Withdrawal Amount |
-$70,000 |
Portfolio Line of Credit is a margin lending product offered only to clients of Wealthfront Advisers LLC by Wealthfront Brokerage LLC. You can learn more about Wealthfront Brokerage Corporation on FINRA's BrokerCheck.
Wealthfront prepared this article for informational purposes and not as an offer, recommendation, or solicitation to buy or sell any security. Wealthfront and its affiliates may rely on information from various sources we believe to be reliable (including clients and other third parties), but cannot guarantee its accuracy or completeness. See our Full Disclosure for more important information.
Wealthfront and its affiliates do not provide tax advice and investors are encouraged to consult with their personal tax advisor. Financial advisory and planning services are only provided to investors who become clients by way of a written agreement. All investing involves risk, including the possible loss of money you invest. Margin lending can add to these risks, and investors should carefully review those risks as part of their overall financial strategy. Diversification strategies do not guarantee a profit or protect against loss in declining markets. Past performance does not guarantee future performance. Learn more about Portfolio Line of Credit in the Margin Handbook.
Financial advisory, planning, and investment management services are offered by Wealthfront Advisers LLC (“Wealthfront”), an SEC registered investment adviser. Brokerage products and services offered by Wealthfront Brokerage LLC, member FINRA / SIPC, and a wholly-owned subsidiary of Wealthfront Corporation.
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