When I opened a taxable brokerage account with Fidelity, my account type was Margin (even though I didn’t apply for a margin account). I suspect this is still true with any new account opening.
A margin account entails a great deal of risk and responsibility. If you are not prepared for the extra leverage, you should convert your Fidelity margin account to a Cash account.
How to Convert your Fidelity Margin Account to Cash Account
- Login to Fidelity and collect your account details. You will need to have your account number ready.
- Call Fidelity customer service at 800-343-3548.
- Talk to a representative and request a change of account type. Tell them you want to change your Fidelity Margin account to a Cash account.
You can check the Margin Status of your Fidelity account through this page.
This process should be quick and easy. Once you get in touch with a representative, they will convert your account to a cash brokerage account.
A cash account does not come with instant settlement. This implies that you must be aware of your day-to-day trading activity.
You should also be aware that trading with unsettled cash can result in a “Good Faith Violation.” If you receive more than three (3) violations in a 12-month period, your account may be restricted for 90 days.