Day Trading under $25k...

Well as a previous customer of Alliance I can attest that their commissions are high for a reason. It's the only broker around that gives small accounts big boy rights! You get around the PDT Rule in trade for slightly higher trades. You got 2 ways to go per share or flat fee.

I used them for over 1 year. Love there DAS trader Pro software. But, I went to a lower priced broker. Got a deal I couldn't resist.

It's tough with commissions like this on small accounts. But, if your trading mechanicism is ideal, it's only a matter of time until you can reach your capital goal.

Keep us posted on your trading ventures.
Quote from TurboSetch:

Yeah I figured as much about a firm like that. I think I am going to stick to the alliancetrader/alldaytrader idea and just use them until I am able to get the $25k to day trade in the states. 4:1 margin isn't bad for $5k. I was sim trading with there software today and was quite happy with the results. I was able to make about $250 with 1500 shares after commish on just FDRY alone. If I can maintain 100-300 a day that would be fine with me. I have lots of patience after doing this for a while.

I have to admit I am nervous about using these off shore firms but I can't
find anything negative about them except the commish rates.

Oh well I am going to sit it out and wait about a month before I deposit with them to be sure I can't dig anything up. I emailed allianance today asking about better rates and what they would offer me based on an estimate trade pattern of 4-20 trades a day.

I have been researching these prop firms but can't really get comfortable with the idea. I live in Alaska as well so the timing is good for me though. -4 hours from EST lets me get up at 4am work the early morning then go into work(day job) at 9am AST which is generally after I make money on the spikes and movers of the day.

Thanks for the good reply guys I knew some helpful people did exist out there some where.
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If folks want to trade intraday and have less than $25k, stop trying to find ways around the annoying limitations of trading stocks (PDT rule, up-tick rule, T+3 settlement, short-list availability, etc.) and consider trading futures instead. Futures also offer a fair and transparent marketplace (instead of specialists and MMs), relatively consistent volatility, better trading hours, 60/40 tax treatment, and no itemized trade reporting on your tax return.
 
Quote from JangoFolly:

no itemized trade reporting on your tax return. [/B]
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Good points Jango.
How are emini trades treated at year end for taxes in a taxable account?
 
Quote from nlslax:

How are emini trades treated at year end for taxes in a taxable account?
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You get a net P/L on your 1099. Net figure is reported on Form 6781, which breaks out short-term (40%) and long-term (60%)capital gain/loss. Those two figures are passed to your Schedule D, one line for short-term, one line for long-term. No itemizing trades.
 
Quote from JangoFolly:

You get a net P/L on your 1099. Net figure is reported on Form 6781, which breaks out short-term (40%) and long-term (60%)capital gain/loss. Those two figures are passed to your Schedule D, one line for short-term, one line for long-term. No itemizing trades.
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Thanks for your reply. I'm sold. Wish my option spreads were that simple.
 
Quote from nlslax:

Thanks for your reply. I'm sold. Wish my option spreads were that simple.
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I know options on commodities and broad-based stock index futures are also taxed 60/40, but I'm not knowledgeable about how those transactions are reported for tax purposes.
 
I'm gonna look into it.
I do credit spreads on the SPX, but would prefer to use options on the futures contract because you can go further OOM. If the tax reporting was simpler, that would clinch it for me.
 
Here is the response from Alliance on the rates:


At 16 trades per day, we can offer you $9.95 per trade, charged each trade (buy or sell)

For example

Buy and sell 1000 units via ARCA
Buy:9.95 + 1* + (1000x 0.004) = 14.95

Sell: 9.95 + 1 + (1000x 0.004) + [1000x (0.00075 +0.0000418)**]= 15.74

Total $30.69

* $1 software flat fee charged each trade
** Sell side fees charged every sell
 
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