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Special Cash Account
A brokerage account in which the customer must pay the full amount for securities purchased by an agreed upon date, often within two days of the purchase. Customers are not allowed to borrow in order to pay off the account. Special cash accounts in the United States are governed by Regulation T and are the most basic kind of investment account. Examples of special cash accounts include Individual Retirement Accounts (IRAs) and trusts for minor children.
A brokerage account requiring that cash payments on purchases and deliveries on sales be made promptly. (Settlement is officially five business days after the transaction date.) The cash account is the most popular type of brokerage account even though it does not permit investor borrowing (that is, buying on margin). Also called special cash account. Compare margin account.