Day Trading Buying Power
The rule increases day trading buying power to up to 4 times a pattern day trader's maintenance margin excess. For example, if a trader has $100,000 worth of equities, the leverage ratio is 4:1 meaning that it can buy securities of up to $400,000.
For day trading in equity securities, the day trading margin requirement shall be 25% of either:
- the cost of all day trades made during the day; or
- the highest open position during the day.
If a client's day trading margin requirement is to be calculated based on the latter method, the brokerage must maintain adequate time and tick records documenting the sequence in which each day trade is completed. Time and tick information provided by the customer is not acceptable.
Read more about this topic: Pattern Day Trader
Famous quotes containing the words day, trading, buying and/or power:
“To get time for civic work, for exercise, for neighborhood projects, reading or meditation, or just plain time to themselves, mothers need to hold out against the fairly recent but surprisingly entrenched myth that good mothers are constantly with their children. They will have to speak out at last about the demoralizing effect of spending day after day with small children, no matter how much they love them.”
—Wendy Coppedge Sanford. Ourselves and Our Children, by Boston Womens Health Book Collective, introduction (1978)
“His farm was grounds, and not a farm at all;
His house among the local sheds and shanties
Rose like a factors at a trading station.”
—Robert Frost (18741963)
“screenwriter
I spent the whole afternoon being pushed around by middle-class females buying things they cant possibly afford!”
—Arthur Wimperis (18741953)
“I swear by the mighty power of Amon-Ra, whose anger can shatter the world, and by the dread power of Set, that I will never betray my trust as High Priest of Karnak.”
—Griffin Jay, Maxwell Shane (19051983)