{"id":7082,"date":"2019-03-26T10:10:50","date_gmt":"2019-03-26T10:10:50","guid":{"rendered":"https:\/\/www.wasteyourtime.co\/?p=7082"},"modified":"2019-09-06T21:29:57","modified_gmt":"2019-09-06T20:29:57","slug":"pattern-day-trader-rule","status":"publish","type":"post","link":"https:\/\/traders-paradise.com\/magazine\/2019\/03\/pattern-day-trader-rule\/","title":{"rendered":"The pattern day trader rule"},"content":{"rendered":"

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3 min read<\/span><\/i><\/p>\n

\"The
\nThe pattern day trader rule is among the most misunderstood stock market terms. The rule says you must support a brokerage account balance with at least $25,000.<\/span><\/p>\n

FINRA<\/a> rules define a \u201cpattern day trader\u201d as any customer who executes four or more \u201cday trades\u201d within five business days, provided that the number of day trades represents more than six percent of the customer\u2019s total trades in the margin account for that same five business day period. \u00a0<\/span><\/p>\n

This rule represents a minimum requirement, and some broker-dealers use a slightly broader definition in determining whether a customer qualifies as a \u201cpattern day trader.\u201d \u00a0Customers should contact their brokerage firms to determine whether their trading activities will cause them to be designated as pattern day traders.<\/span><\/p>\n

Just leave this confusing definition. Forget it!<\/span><\/p>\n

Point is that you need a minimum $25,000 to start the day trading<\/a>!<\/span><\/p>\n

Are they crazy? That\u2019s a tonne of money, don’t you think? Who can start the stock market run with that much money? So, what a day trader has to do?<\/span><\/p>\n

Yes, we have to leave hypotheses. There\u2019s so-called pattern day trader rule. And it is considerably more complicated than most people think.<\/span><\/p>\n

You probably hear about the term \u201cday trader\u201d, but you don’t hear \u201cpattern day trader.\u201d <\/span><\/p>\n

Honestly, they\u2019re actually the same. <\/span><\/p>\n

However, if you want to get into day trading you have to know the rules. <\/span><\/p>\n

The Financial Industry Regulatory Authority (FINRA) rules, provides a clear definition of who a \u201cpattern day trader\u201d is. <\/span><\/p>\n

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