I have roughly 30,000 in my IB stock margin account. I actively trade stocks, 5 round-trips a day at least. If my account were to fall below 25K would it be 'frozen' for 90 days?
IB account falls below $25K
- Thread starter deadreader
- Start date
It's the NYSE and NASD rules on Pattern Day Trading - summary:
o Customers who have made four or more securities day trades (open and close a stock or option position in a single day) within five business days are considered âPattern Day Tradersâ.
o Customers who are Pattern Day Traders and have less than $25000 in equity will not be allowed to place additional opening orders. Any customer that has been flagged as a Pattern Day Trader will have this designation for 90 days from the date that the pattern was most recently established.
o The above restrictions do not apply to customers with over $25000 in equity.
Please note that the NYSE requires these rules to be followed by all brokerage firms.
For IB:
o For customers that have less than $25000 in equity, IB allows only 3 day trades in a 5 day period to ensure that customers to do not acquire the PDT status that triggers the 90 day opening trade prohibition. After 3 trades, customers will be allowed to open new positions in 1-5 days depending on the previous day trade activity. Closing trades are always permitted without restriction.
Wow! That's brutal. I thought that IB's policy was the PDT reg. I didn't realize you were protecting me from Big Brother. Thx again...
Do you guys have any discount brokers similar to IB? I've got a couple of relatively small accounts and can't afford high commissions.
Also: can you trade NYSE and NASDAQ issues from a European broker? (Please forgive my ignorance!)