Pattern Day Trading Rule, how to avoid

Multiple accounts sound good, just go all in, 1 position per account, need 2K+ for Margin requirements ofcourse in each.

The real question is, why didn't I think of that earlier, hmmmmmm, ERROR!!
 
I personally had this problem a few months ago up until I joined a prop firm. I am not subject to the PDT rule because I'm trading the firms funds. Other than having to split the profits it's been a blast. Luckily I didn't have to make a 5-10k capital contributions to put my money ahead of theirs.

Im looking for daytrading friends. Skype: steve.magana1
 
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Here's a link about pattern day trader status:
https://support.robinhood.com/hc/en-us/articles/203585005-Day-Trading

Excerpt: "Pattern Day Trading rules only apply to margin accounts; a customer trading in only a cash account will not be designated as a Pattern Day Trader...Please note that there is no limit on Day Trades in a cash account."

(What is the "catch"? You must wait 3-4 days for funds to settle after you liquidate a position.)

If you have a cash account, they say, you cannot ever get pattern day trader status; that only comes with a margin account; BUT, you have to wait 3 days for your funds to become available again after you sell a position; if you used only 1/4 of your cash each day for one day trade, you could day trade once every day; if you used only 1/8 of your cash each trade, you could make 2 day trades each day.

IF you had $10k in a cash account, theoretically, you could make one $2,500 day trade every open market day, and never get the PDT status; or, you could make ten $1000 day trades spaced evenly over every 3-4 days.

Basically, it is impossible to get pattern day trader status with a cash account (with ALL brokerages???)...but you get no margin and must wait 3-4 days for the funds to settle after each sale.
 
Bry said:
IF you had $10k in a cash account, theoretically, you could make one $2,500 day trade every open market day, and never get the PDT status; or, you could make ten $1000 day trades spaced evenly over every 3-4 days.
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Theory is well and good, but sadly real life isn't that easy ever.

And when you do get to the magic 25K+ you'll get 4x's Margin, which you'll use being greedy, hits are generally worse than the profits are good, so pretty soon you'll be sub 25K again.
 
Turveyd said:
Theory is well and good, but sadly real life isn't that easy ever.

And when you do get to the magic 25K+ you'll get 4x's Margin, which you'll use being greedy, hits are generally worse than the profits are good, so pretty soon you'll be sub 25K again.
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depends how good the entries are; and, some day trade entries "should" become swing trades that do well
you are really talking money management, and that can never be stressed enough...for me too! if I had $100k, I would "want" to begin risking about $500 or 1/2% per short term trade, but after a few wins (or losses!) would I get greedy (or desperate) and start risking more? too bad for me if I didn't wait a lot longer to prove myself before increasing my risk
 
Bry said:
depends how good the entries are; and, some day trade entries "should" become swing trades that do well
you are really talking money management, and that can never be stressed enough...for me too! if I had $100k, I would "want" to begin risking about $500 or 1/2% per short term trade, but after a few wins (or losses!) would I get greedy (or desperate) and start risking more? too bad for me if I didn't wait a lot longer to prove myself before increasing my risk
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Human Nature suggests that 99% of us would get greedy, that's why 99% of us lose.

I trade a FX spot account, no major blow outs since dropping margin from 200x's to 50x's, I run my account, 1 position right upto the 50x's Margin allowance :) and will keep doing this until I can' trade larger all being well.
 
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