Cash

Cash, in a trading account, is simply the money sitting in your account that isn't tied up in a stock, option, or other position. It's the balance you could withdraw or use to buy something right now, as opposed to the value of things you already own.

In a brokerage account, your total account value is usually split between cash and the market value of your holdings. When you sell a stock, the proceeds don't always show up as usable cash instantly — depending on the account and the asset, there can be a settlement period before the money is officially yours to withdraw or reuse without restriction. Until then, brokers often show it as "cash" on the balance summary but may still restrict certain uses of it.

The nuance that trips people up is the difference between "cash" as shown on a broker's dashboard and "settled cash," which is what actually matters for rules about pattern day trading, free-riding, and good-faith violations. A number can say you have cash available, but if it hasn't settled yet, using it to buy and sell again can trigger a violation. This is especially relevant in cash accounts (as opposed to margin accounts), where trading with unsettled funds is restricted.

Cash also refers more broadly to physical or digital currency itself — dollars, euros, yen — as one of the basic asset classes alongside things like stocks, bonds, and commodities. Foreign currency held in an account counts as cash in this broader sense, even though it isn't your home currency.