What are the difference of TOS Available Funds for Trading and Cash Sweep vehicle?

The terms "TOS Available Funds for Trading" and "Cash Sweep vehicle" in the context of a brokerage account like TD Ameritrade represent two different concepts related to cash flow and investment options:

TOS Available Funds for Trading:

• This refers to the immediate balance of cash in your brokerage account that you can use for purchasing securities, placing orders, and covering debits for completed trades.
• This typically includes cash deposits, proceeds from selling securities, and received dividends or interest.
• Think of it as your readily accessible "trading fuel" within your account.

Cash Sweep vehicle:

• This is a feature offered by some brokerages, including TD Ameritrade, where any idle cash above a set threshold (e.g., $1,000) is automatically transferred to a designated investment vehicle.
• This "sweep" happens daily or at certain intervals.
• The purpose is to earn some interest on your uninvested cash rather than letting it sit idle.
• Common Cash Sweep vehicles can be money market funds, interest-bearing accounts, or even high-yield savings accounts.
• Think of it as automatically putting your "spare change" to work while you wait for the right trading opportunities.

In getaway shootout , for the completionists out there, there are tons of achievements and cosmetics to unlock, ensuring you'll be blasting and boosting for hours on end.

When you trade on margin there are funds used as maintenance margin used as collateral in case the position moves against you. TOS wants to protect themselves by restricting the amount you can trade with to ensure you can pay them even if your position goes against you.

These are less prominent for traditional buy/sell. It is more useful and apparent if you trade options/futures.

For e.g. sell credit options like bull put spreads or single puts require a margin collateral. But TOS may not require the full amount to be restricted, just a fraction of it. The amount of "available funds for trading" may change along with the change in stock price of your positions.

At the same time, you may not see a change in Cash and Sweep Vehicle because it is measuring how much cash your account holds at the moment. For credit option positions, you receive cash upfront, thus your cash and sweep may actually increase but funds available for trading.

Again, this may sound very confusing because for traditional long/short, it is less relevant.