What happens if I make 4 trades a day?

Asked 2 years ago

Does making 4 trades a day count as pattern day trading?

Andia Rispah Igobwa

Thursday, December 09, 2021

Depending on your brokerage, the situation may be more or less severe. If your broker has a more forgiving policy, the penalties may not be so terrible if you are a first-time offender.

However, since your broker wants to keep an eye on your actions for any repeat or consistent offenses, you will almost certainly be flagged a pattern day trader (in the ill-meaning sense). So proceed with caution.

Some brokerages may subject you to a minimum equity call if you make four-day trades in a rolling five days. They may require you to deposit enough cash to have a minimum account value of $25,000 (even if you don't intend to day trade regularly).

You may be prohibited from opening new positions if you make an extra day trade while flagged.

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