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Applies to US exchange listed stocks, ETFs, and options. A $0.65 per contract fee applies for options trades. A $6.95 commission applies to trades of over-the-counter (OTC) stocks which includes stocks not listed on a U.S. exchange

Increased market activity has increased questions. Here's how to get answers fast.

 As the market activity increases, call volume also expands. We always give the right answers which you require. For giving most probably answers, we have got a list of FAQs that were being asked by customers most. This list will enhance the knowledge you may require.  

Apple Inc. Stock Split

Apple Inc. (AAPL) recently announced a 4-for-1 stock split. The split takes effect on August 31 for shareholders of record on Aug. 24. The stock split happens automatically in your account and  United Stock Brokers does not charge a fee for this type of a stock split. 

If you own shares of AAPL before Market open on August 31 you will receive four shares for every one you hold, and the stock price will be decreased to one-fourth of its value. For example, if you hold 100 shares of AAPL trading at $400 per share, after the split you will own 400 shares valued at $100 per share. Same as it, if you own one options call with a strike price of $400, after the split you would own four contracts controlling 100 shares each, at a $100 strike price.

If you sell AAPL shares after August 24 but before August 31, you will sell them at the pre-split price. You will not be entitled to the split shares.  If you buy shares after Aug. 24 but before Aug. 31, you will purchase shares at the pre-split price. Following the split, you will receive the extra shares resulting from the stock split.

For example: If on the last business day of trading AAPL, August 28th, you sell 300 shares for a pre-split market price of $400 per share, you will receive $120,000. You will not receive any split shares.

Another example: If on August 26 you buy 100 shares (and hold them through the open on August 31st) at $400 per share, you will pay $40,000. You will receive 300 additional shares after the stock split, and the price will be reduced to the post-split price.

A stock split is a type of corporate action that occurs when a company’s board of directors decides to divide the company’s outstanding shares into a larger or smaller number of shares.

Splits are a change in the number of outstanding shares of a company’s stock without a change in shareholders’ ownership percentage in the company. For example, with a 2:1 split, a client will receive 2 shares for each share owned prior to and through the open on the security’s split ex-dividend date.

There are two types of stock splits:

Forward splits are the division of the outstanding shares of a corporation into a larger number of shares. For example, in a three-for-one stock split (3:1), each old share is now equal to three shares. The price per share would also go down. In this example, if the pre-split share was worth $9, the post-split share would be worth $3. Mostly, splits must be voted by directors and approved by shareholders.

Reverse splits is a decrease in the number of outstanding shares. For example, if you had 300 shares of XYZ and there was a one-to-three reverse split (1:3), your old 300 shares would now be equal to 100 shares. The price of each new share would also be worth more. If the pre-split share was worth $2, the post-split share would be worth $6.

When you hold a short position on a stock that has a forward split, the shares will be debited from (NOT credited to) your account. Essentially, your short position is increased due to the split.

Fractional Shares: USB does not credit or debit fractional shares for stocks. If you receive a fractional share from a split, it will be liquidated and credited as cash to your account. Cash in lieu of fractional shares is often paid after the split shares are paid.

The Ticker Tape®: Slice and Serve: What Is a Stock Split & Why Do Stocks Split?

Video: Stock Splits

Webcast: Apple Inc. (AAPL) 4 for 1 Stock Split: What You Need to Know About Your Stock & Options Positions

Pattern Day Trader Rule

Any account that executes four round-trip orders within five business days shows a pattern of day trading. A round trip occurs when you buy and sell (or sell short and buy to cover) the same stock or options position during the same trading day. If you have been flagged as a pattern day trader, you will need at least $25,000 in total account value at the start of the day or you will have to wait 90 days before you can start trading. Learn more about the Pattern Day Trader rule and how avoiding trading it.

If you would like to request the removal of the pattern day trader flag on your account, as a one-time exception to the Pattern Day Trader rule, please go to Client Services > Message Center to write us, or call our Investor Services Department at 123-456-7890.

Margin Calls

A margin call is issued on an account when certain equity requirements aren’t met when using margins. When a margin call is issued, you will receive a notification via the secure Message Center in the affected account. There are several types of margin calls and each one requires quick action.

Learn more about margin trading and various margin strategies. 

Margin calls are quick and require you to take prompt action. You can either close positions purchased on margin or deposit cash by ACH or wire. To use ACH, you must be able by connected a bank account. Most banks can be connected immediately. However, if you’re asked to look for test deposits in your bank account, you’ll be unable to transfer money right away.  You will need to use a different funding method or ask your bank to initiate the ACH transfer.

Other ways to meet a margin call:
– Transfer shares or cash from another USB account. To connect USB accounts for cash transfers, log in and go to My Account > Deposits & Transfers > Account/Bank Connections.
– Use mobile check deposit from the USB mobile app (Typically, a mobile check deposit appears in your account within minutes; however, if your check is returned for insufficient funds or is delayed for any other reason, that may result in a sellout of your positions without notice, regardless of your intent to cover them.

Good Faith Funding

A good faith violation occurs when you sell a security in a cash account without paying for the initial purchase. Here’s how that can happen:

When you buy or sell securities, it takes two days for cash from those trades to settle down, or move from the buyer to the seller. When you sell a security, you’re allowed to immediately make a good faith purchase of another security, even though the funds from the initial sale won’t settle for two days. However, if you sell the new security less than two days after the first sale, that counts as a good faith violation.

You hold $10,000 of settled Company A stock. On Monday, you sell that Company A stock for $11,000. Later on Monday, you buy $11,000 of Company B stock, which is a good faith trade. On Tuesday, you sell the Company B shares for $12,000. That’s a good faith violation.

After three good faith violations, you will be limited to trading only with settled funds for 90 days.

As a result, when you sell a security, you would have to wait until funds settle in two business days before buying another security. You can avoid those restrictions by converting a cash account into a margin account, although not all accounts are eligible for margin.

See the article in The Ticker Tape®: Managing the Strike Count: How to Avoid Good Faith Violations.

For New Clients

With timely articles and webcasts, an extensive library of how-to videos, and an immersive curriculum, our comprehensive resources will help you become a well known  trader.

Our Education Center also offers specialized and personal learning paths  – just log in, tell us about your mission and interests, then choose a topic you want to learn more about. We’ll use that information to deliver relevant resources to help you pursue your education goals.

Also, be sure to check out live market coverage and education from our media affiliate, the USB Network.*


*USB Network is brought to you by USB Media Productions Company. USB Media Productions Company and USB, Inc. are separate but affiliated subsidiaries of USB Holding Corporation. USB Media Productions Company is not a financial adviser, registered investment advisor, or broker-dealer.

Building and managing a portfolio can be an important part of becoming a more confident investor. Interested in learning about rebalancing? Our Education Coaches offer weekly webcasts on the Building Blocks of a Self-Directed Portfolio; check out this recorded session on the Portfolio Rebalancing Process. 

For a deeper dive, log in to your USB account to access the Simple Steps for a Retirement Portfolio course, offering step-by-step instructions on how to build a retirement-focused portfolio. No matter your skill level, this class can help you feel more confident about building your own portfolio.

A wash sale occurs when a client sells a security at a loss and then repurchases a “substantially identical” replacement security in a 61-day window (30 days prior to the sale, the day of the sale and 30 days after the sale). Any loss is deferred until the replacement shares are sold. Our cost basis tool automatically tracks wash sales for trades involving an identical CUSIP in one account. Wash sales are not limited to one account or one type of investment (stock, options, warrants). Learn more about wash sales and how to report them.

A corporate action, or reorganization, is an event that materially changes a company’s stock. This could include stock splits, dividends, mergers, right/warrant issues, or spin offs. Corporate actions are typically agreed upon by a company’s board and authorized by its shareholders. If a stock you own goes through a reorganization, fees may apply. In order to help cover the cost of re registering a security going through a mandatory or voluntary reorganization, accounts are charged a reorganization fee for equity conversions and warrant/rights exercises. Learn more about corporate action.

You can get the answers to questions not covered here from USB, our Virtual Agent or in our Help Center. After you log in to your account, click Support at the top of any page on the site, then Ask Ted or Help Center.