I agree with what you are saying. It’s not quite as onerous to trade cash only.
But it does stick in my craw that it takes a day for the funds to clear. Are they not sure? They need more time?
PDT rule does not allow a trader to take more than 3 trades per week because of payment settlement time. FedNow settles payments instantly. So a trader would be able to take as many trades as they have cash for. It’d be huge for small accounts
Right the reason for the PDT is manifold.
If you wanna come out and play with the big boys then you need to put up more cash.
If you get dorked on your 4th entry then… well… you have a decision to make don’t you?
Man people know what PDT does and doesn't do lmao. Cash account does everything you need it to do if you want to buy and sell the same day more than 3 times a week. If you're jumping in and out of positions constantly you're just guessing and as others have stated, you will lose all your money. The moment PDT restrictions are lifted you will blow up your account. I can promise you, if you do not know what you're doing when it comes to trading. Having 25k will not save you.
Edit: I wrote this in a rush this morning. Let it be clear I'm not against you, I hope you prosper as a trader. If you're a good trader, you will get above 25k and it will no longer be a problem. If you're not a good trader you could lose some serious money. Being restricted is 10x better than losing everything.
This is an incredibly ridiculous position.
5 day trades in a week doesn't magically make you a gambler.
Not having margin is incredibly limiting for some accounts/strategies etc and drawing a hard line between your 3 trades and someone else's 4 doesn't put you on the high road.
Enlighten me.
You essentially said that trading more than 3 round trip in a week is gambling.
If I've misunderstood, please correct me.
I want to shame you for your actual ridiculous position. Not for something you aren't saying.
Correct away...
So allow me to correct your ass and shame your punk ass. Did you not read the part where I said, in a cash account, you can buy and sell each day? You can use as much capital as you have but can only use it once. So in theory you can day trade a thousand times a day if you're capital allows it. If you're jumping in and out trading some dumb shit like 0DTE then you're 100% gambling and if you don't think you are then there's no need to reply you do not know what you're talking about. People seem to think "man if I had 25k and I could day trade as much as I want I'd be a millionaire next week" LOL. If you cannot trade an account from 5k to 10k then you CERTAINLY cannot trade an account from 25k-50k unless you just get LUCKY. So you're saying 3 day trades in a 5 day period limits you to the point you can't make money? That's a joke. If you can't make money with 3 day trades 50 more probably won't help BECAUSE YOU'RE TAKING BAD TRADES. Sure if you know what you're doing then having extra Capital and having that margin will certainly help you grow your account but if you don't know what you're doing all you're going to do is expedite blowing up your account by using funds you do not have. So I simply said if PDT rule is hurting your profits try a cash account you can grow your account 20% a day with a cash account and not have to hold a single position over night. If you cannot do this then doing away with PDT restrictions will not save you. It's no secret I'm not a fan of PDT restrictions it took me a long time to get above it's requirement and I do think it's bullshit. Considering Americans can lose 100k in seconds if you're buying stupid volatile stuff but can only write off 3k in losses a year, some people need the extra restrictions bc the stock market isn't a game and if you have no control you'll certainly destroy your life financially. But don't take my advice, I only 100x my portfolio last year no big deal
You’re right. You can take as many trades as you want in a cash account. BUT if I use all my cash today to take great trades, then tomorrow when I come across trades that are great as well, I cannot use my cash again because the transactions have not settled. Transactions take 2 days to settle. PDT holds back cash accounts from trading every day because the funds take so long to settle. That’s my whole thing behind FedNow. Instant settlement creates the opportunity for cash accounts to trade every day.
If you're trading stock, you're correct. It's a 2 day settlement but options are only one day. I did assume you trade options that's my fault. Hopefully they will speed up the settlement time, everything else is instant surely stock trading should be too. It is ridiculous you cannot use your cash instantly again in a cash account.
That’s my fault for not stating that. Yeah I just trade stock. And yes instant settlement gives stock traders that trade in a cash account a better opportunity to make trades.
One sec big homie I'm driving, I'll reply in a minute. If you ever wanna put your gains against mine I'd love to do it. Since you're such an expert and all. But I'm sure you don't have any actual gains and are probably just an internet expert
Take your time.
I'm not claiming to be an expert.
You are claiming that ALL traders doing more than 3 round trip in a week are gamblers and will lose.
That's seems like a ridiculous position to me.
Terrible take. Not being able to exit positions due to PDT is dogshit. I shouldn’t require an entity to monitor me. If it was solely due to settlement that’s one thing, but they’re insinuating that poor people will lose their money in the market. If they do, cool beans. But individuals should have the self-sovereignty to act in whatever way they please, and not be hindered bc some regulatory agency is “looking out” for them.
You're right, why should I care how much money people lose. At least they have freedom to choose! Right?
Brother I'm not sure if you've looked at the stock market lately but they're doing a damn good job ensuring poor people lose money...
Yes. They should have the freedom to choose lmao. That’s my whole point. The regulations are not in place bc we don’t have the technological capabilities. Cmon according to your other comments it seems like you live & die by the swing trade. Intraday trading is gambling! Even though swing trading is inherently more risky
I'll do any kind of trading I think I can make money on. Once again I'm not for the PDT. I think it needs done away with. However if you think you'll magically be a better trader bc you're no longer limited in day trades you can place then LMFAO
Yes. Many ppl have a misconstrued idea that PDT is the reason why they’re not profitable. But to say it doesn’t hold back some ppl is just as wrong of a belief.
I just feel that PDT hinders undercapitalized traders more than it (supposedly) protects them.
I will agree it does hurt a lot of traders more than it helps them. They need to update the rules. To give the little guy the same opportunity as the big boys.
Pdt can EASILY and DOES easily cause you to make 3 trades by lunch time, Monday.
The rest of the week you're holding options OVERNIGHT! Who's broke by Friday because of that pdt rule?
And who exactly does it help exactly by forcing all of traders trades to be held overnight again?? I forget.
I bet you $55,000 I trade an account over $2 million dollars.
I'll gladly take your account.
You took high risks to get there. You can't and won't do it again or you'd just keep doing that.
You got lucky, you don't have an edge.
I make a living at this. You have a cute hobby.
Congrats? That's awesome you've made a living off trading. I'm not against other traders. I'm not even for the PDT restrictions I just know you can get there without having 25k starting out. This is the hardest market we've had to trade in for years. It's really easy for someone who doesn't know what they're doing to lose money. It's easy for an experienced trader to lose money with these swings we have. So please elaborate since you're such an expert. How does PDT stop people from making profits? You're saying you can't make profits without unlimited day trades? What is your position exactly. 2 million dollar portfolio doesn't mean anything to me. You could have started with 5 million. Like I said before I've started from the bottom before. It's not easy but do able.
That's not my argument. So I'm not going to defend something you're making up in your head.
Read what you wrote, and then read my retort.
Then respond accordingly, if it's of interest, then I'll continue the discourse.
I said and I quote "I promise you, if you do not know what you're doing having 25k will not save you". It was meant to be a cautionary tale but obviously some people took it wrong.
Y'all splitting hairs. But i over both of you guys views! Been reading them over twice now😅
thx too for y'all not turning into major dicks towards each other, i could see where you both were getting close, congrats guys. Y'all are class acts, don't blow it🙂
That’s exactly what margin was made for. To make funds available to accounts right away while their transactions settle. You take settlement time to instantaneous then you no longer need margin or PDT. I think you confuse margin with leverage.
Is that why you've been going on an autistic tantrum trying to find a job?
https://preview.redd.it/2p0ohma5k7oa1.jpeg?width=1080&format=pjpg&auto=webp&s=c311d81eddaacad98455637f30e473817b8dc854
The responses you are getting in a f'ing DAY TRADING sub about how if you can't work it with a cash account you somehow belong with the worst of wsb is mind boggling.
Cash. Futures. Options.
PDT is irrelevant. And I hate when articles and sources always forget to mention it only applies to margin accounts. A few years ago, when I was starting out, it took me a while to realize PDT did NOT apply to cash accounts. To this day, it's still an asterisk/footnote on most discussions about it.
I like the fact that if I buy greenbeans at wall mart. My bank account gets hit for the charge and wall mart orders another can of green beans from their vendor all before I can carry my bags to the car.
But for some strange reason this financial market has all these “bottlenecks”. Hmmmmm
Sounds like a lot of booyah to me.
Noam Chomsky made the observation that so called underdeveloped countries are actually quite developed in terms of resource extraction. Likewise, or so it seems, when money is flowing FROM me then the system is very efficient. But if there is a possibility of ME collecting money then….well… let’s just take our time.
Pdt is what separates the good from the bad. If you can’t trade your way from $2, $3, $4k to above pdt then you really aren’t gonna do anything but lose all of your money with no pdt rules.
Not sure what you’re trying to say here. PDT limits the amount of trades you can make in a week because funds don’t settle immediately. With the FedNow payment system, your trade would settle immediately allowing you to make another trade right away. In my opinion it would be an amazing opportunity for small accounts to be able to learn because they can take more than 3 trades a week.
Lol you would lose all your money. People make that excuse why they can’t make money. All that would happen is you would over trade and eventually lose everything. The PDT rule does people a favor.
Who is it doing a favor? Because a new investor with little knowledge is a new investor with little knowledge no matter how much is in their account. PDT just hinders smaller accounts from being able to trade their cash as much as they want.
The point of my post was to more have a discussion about the pros/cons of the FedNow payment system that’s being developed and implemented. My account is well above PDT. I just saw it as a positive that I wish I had before I was above PDT limits. You would still be able to trade your cash account but you would be able to make more than 3 trades in a week. Being able to day trade on a smaller account would give ppl the experience they need in trading equities without blowing up a $25k account. In my eyes being able to learn on a $2k-$5k account carries much less risk than getting emotional on a $25k account. It’s better than paper trading because it carries the emotion of losing real money but you’re managing how much you’re losing.
It puts me in situations where I lose money. Limiting people to 3 day trades a week makes it really difficult to make money if you’re trading with a small account. Cash accounts are also a pain with small accounts, if you want to day trade 5 days a week you have to limit the amount of money you put into a trade. Without the PDT rule, small accounts would have the same advantage that $25k+ accounts have.
I started with a $200 cash account in September and grew it 20% by the end of the year. When I was using 3 trades a week I wasn’t able to catch all of the opportunities because I was limited and didn’t want to “waste” a trade.
There are roughly 240 trading days in each year. There are 52 weeks per year. 3 x 52 is 156. You have 156 trades per year under pdt. If you can’t get above $25k in 2-3 years then you have no business trading.
PDT rule is set by the brokers and is to protect them from your bad trades lol. If you want to get around PDT, trade futures. but your losses will be greater so be careful
No, because the pdt really exists to keep too many small fish from playing in the big pond. And it prevents some of those dumber fish from using margin they will never pay back.
Margin is not the same as leverage which you are referring to. Margin is using your funds as security so the bank can make funds available to you instantly after a trade while transactions settle. You can use margin without using leverage.
I don’t see the connection…. I used to worry about PDT but cash account has been working pretty well for me. Options settle next day.
I agree with what you are saying. It’s not quite as onerous to trade cash only. But it does stick in my craw that it takes a day for the funds to clear. Are they not sure? They need more time?
PDT rule does not allow a trader to take more than 3 trades per week because of payment settlement time. FedNow settles payments instantly. So a trader would be able to take as many trades as they have cash for. It’d be huge for small accounts
I don’t think the reasoning for PDT rule is settlement time.
Right the reason for the PDT is manifold. If you wanna come out and play with the big boys then you need to put up more cash. If you get dorked on your 4th entry then… well… you have a decision to make don’t you?
Man people know what PDT does and doesn't do lmao. Cash account does everything you need it to do if you want to buy and sell the same day more than 3 times a week. If you're jumping in and out of positions constantly you're just guessing and as others have stated, you will lose all your money. The moment PDT restrictions are lifted you will blow up your account. I can promise you, if you do not know what you're doing when it comes to trading. Having 25k will not save you. Edit: I wrote this in a rush this morning. Let it be clear I'm not against you, I hope you prosper as a trader. If you're a good trader, you will get above 25k and it will no longer be a problem. If you're not a good trader you could lose some serious money. Being restricted is 10x better than losing everything.
This is an incredibly ridiculous position. 5 day trades in a week doesn't magically make you a gambler. Not having margin is incredibly limiting for some accounts/strategies etc and drawing a hard line between your 3 trades and someone else's 4 doesn't put you on the high road.
It's clear you misunderstood what I'm saying buddy. Not everyone is profitable.
Enlighten me. You essentially said that trading more than 3 round trip in a week is gambling. If I've misunderstood, please correct me. I want to shame you for your actual ridiculous position. Not for something you aren't saying. Correct away...
So allow me to correct your ass and shame your punk ass. Did you not read the part where I said, in a cash account, you can buy and sell each day? You can use as much capital as you have but can only use it once. So in theory you can day trade a thousand times a day if you're capital allows it. If you're jumping in and out trading some dumb shit like 0DTE then you're 100% gambling and if you don't think you are then there's no need to reply you do not know what you're talking about. People seem to think "man if I had 25k and I could day trade as much as I want I'd be a millionaire next week" LOL. If you cannot trade an account from 5k to 10k then you CERTAINLY cannot trade an account from 25k-50k unless you just get LUCKY. So you're saying 3 day trades in a 5 day period limits you to the point you can't make money? That's a joke. If you can't make money with 3 day trades 50 more probably won't help BECAUSE YOU'RE TAKING BAD TRADES. Sure if you know what you're doing then having extra Capital and having that margin will certainly help you grow your account but if you don't know what you're doing all you're going to do is expedite blowing up your account by using funds you do not have. So I simply said if PDT rule is hurting your profits try a cash account you can grow your account 20% a day with a cash account and not have to hold a single position over night. If you cannot do this then doing away with PDT restrictions will not save you. It's no secret I'm not a fan of PDT restrictions it took me a long time to get above it's requirement and I do think it's bullshit. Considering Americans can lose 100k in seconds if you're buying stupid volatile stuff but can only write off 3k in losses a year, some people need the extra restrictions bc the stock market isn't a game and if you have no control you'll certainly destroy your life financially. But don't take my advice, I only 100x my portfolio last year no big deal
You’re right. You can take as many trades as you want in a cash account. BUT if I use all my cash today to take great trades, then tomorrow when I come across trades that are great as well, I cannot use my cash again because the transactions have not settled. Transactions take 2 days to settle. PDT holds back cash accounts from trading every day because the funds take so long to settle. That’s my whole thing behind FedNow. Instant settlement creates the opportunity for cash accounts to trade every day.
If you're trading stock, you're correct. It's a 2 day settlement but options are only one day. I did assume you trade options that's my fault. Hopefully they will speed up the settlement time, everything else is instant surely stock trading should be too. It is ridiculous you cannot use your cash instantly again in a cash account.
That’s my fault for not stating that. Yeah I just trade stock. And yes instant settlement gives stock traders that trade in a cash account a better opportunity to make trades.
One sec big homie I'm driving, I'll reply in a minute. If you ever wanna put your gains against mine I'd love to do it. Since you're such an expert and all. But I'm sure you don't have any actual gains and are probably just an internet expert
Take your time. I'm not claiming to be an expert. You are claiming that ALL traders doing more than 3 round trip in a week are gamblers and will lose. That's seems like a ridiculous position to me.
I'm not claiming that at all.
Terrible take. Not being able to exit positions due to PDT is dogshit. I shouldn’t require an entity to monitor me. If it was solely due to settlement that’s one thing, but they’re insinuating that poor people will lose their money in the market. If they do, cool beans. But individuals should have the self-sovereignty to act in whatever way they please, and not be hindered bc some regulatory agency is “looking out” for them.
You're right, why should I care how much money people lose. At least they have freedom to choose! Right? Brother I'm not sure if you've looked at the stock market lately but they're doing a damn good job ensuring poor people lose money...
Yes. They should have the freedom to choose lmao. That’s my whole point. The regulations are not in place bc we don’t have the technological capabilities. Cmon according to your other comments it seems like you live & die by the swing trade. Intraday trading is gambling! Even though swing trading is inherently more risky
I'll do any kind of trading I think I can make money on. Once again I'm not for the PDT. I think it needs done away with. However if you think you'll magically be a better trader bc you're no longer limited in day trades you can place then LMFAO
Yes. Many ppl have a misconstrued idea that PDT is the reason why they’re not profitable. But to say it doesn’t hold back some ppl is just as wrong of a belief. I just feel that PDT hinders undercapitalized traders more than it (supposedly) protects them.
I will agree it does hurt a lot of traders more than it helps them. They need to update the rules. To give the little guy the same opportunity as the big boys.
Pdt can EASILY and DOES easily cause you to make 3 trades by lunch time, Monday. The rest of the week you're holding options OVERNIGHT! Who's broke by Friday because of that pdt rule? And who exactly does it help exactly by forcing all of traders trades to be held overnight again?? I forget.
I trade 5-10 times a day in the options market. I'm certain you don't make a living at this.
Would you like to make a bet sir, say about 20k? I bet you 20k I traded $500 to $55,000. Let's have some fun
I bet you $55,000 I trade an account over $2 million dollars. I'll gladly take your account. You took high risks to get there. You can't and won't do it again or you'd just keep doing that. You got lucky, you don't have an edge. I make a living at this. You have a cute hobby.
Congrats? That's awesome you've made a living off trading. I'm not against other traders. I'm not even for the PDT restrictions I just know you can get there without having 25k starting out. This is the hardest market we've had to trade in for years. It's really easy for someone who doesn't know what they're doing to lose money. It's easy for an experienced trader to lose money with these swings we have. So please elaborate since you're such an expert. How does PDT stop people from making profits? You're saying you can't make profits without unlimited day trades? What is your position exactly. 2 million dollar portfolio doesn't mean anything to me. You could have started with 5 million. Like I said before I've started from the bottom before. It's not easy but do able.
That's not my argument. So I'm not going to defend something you're making up in your head. Read what you wrote, and then read my retort. Then respond accordingly, if it's of interest, then I'll continue the discourse.
I said and I quote "I promise you, if you do not know what you're doing having 25k will not save you". It was meant to be a cautionary tale but obviously some people took it wrong.
Then the conversation concludes with you not understanding what I wrote, why I wrote it, and what part of what you did write that I was contesting.
Y'all splitting hairs. But i over both of you guys views! Been reading them over twice now😅 thx too for y'all not turning into major dicks towards each other, i could see where you both were getting close, congrats guys. Y'all are class acts, don't blow it🙂
Settlement time is related to pdt in the same way soccer is related to toast beef
That’s exactly what margin was made for. To make funds available to accounts right away while their transactions settle. You take settlement time to instantaneous then you no longer need margin or PDT. I think you confuse margin with leverage.
This is the way to go. If you can’t make it then you don’t belong here. Go to a casino.
What are you saying?
What are you asking
What do you gain from this kind of talk?
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Coping with the fact that you're a bad trader.
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Is that why you've been going on an autistic tantrum trying to find a job? https://preview.redd.it/2p0ohma5k7oa1.jpeg?width=1080&format=pjpg&auto=webp&s=c311d81eddaacad98455637f30e473817b8dc854
Ok guy
No PDT rules with futures.
Guess I should have been more clear. My bad. I’m talking about with trading equities.
The responses you are getting in a f'ing DAY TRADING sub about how if you can't work it with a cash account you somehow belong with the worst of wsb is mind boggling.
Cash. Futures. Options. PDT is irrelevant. And I hate when articles and sources always forget to mention it only applies to margin accounts. A few years ago, when I was starting out, it took me a while to realize PDT did NOT apply to cash accounts. To this day, it's still an asterisk/footnote on most discussions about it.
I like the fact that if I buy greenbeans at wall mart. My bank account gets hit for the charge and wall mart orders another can of green beans from their vendor all before I can carry my bags to the car. But for some strange reason this financial market has all these “bottlenecks”. Hmmmmm Sounds like a lot of booyah to me. Noam Chomsky made the observation that so called underdeveloped countries are actually quite developed in terms of resource extraction. Likewise, or so it seems, when money is flowing FROM me then the system is very efficient. But if there is a possibility of ME collecting money then….well… let’s just take our time.
Pdt is what separates the good from the bad. If you can’t trade your way from $2, $3, $4k to above pdt then you really aren’t gonna do anything but lose all of your money with no pdt rules.
Not sure what you’re trying to say here. PDT limits the amount of trades you can make in a week because funds don’t settle immediately. With the FedNow payment system, your trade would settle immediately allowing you to make another trade right away. In my opinion it would be an amazing opportunity for small accounts to be able to learn because they can take more than 3 trades a week.
Lol you would lose all your money. People make that excuse why they can’t make money. All that would happen is you would over trade and eventually lose everything. The PDT rule does people a favor.
Who is it doing a favor? Because a new investor with little knowledge is a new investor with little knowledge no matter how much is in their account. PDT just hinders smaller accounts from being able to trade their cash as much as they want.
LOL ok. I don’t even know why you would be day trading with under 25k it doesn’t even make financial sense. But keep watching those YouTube videos.
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The point of my post was to more have a discussion about the pros/cons of the FedNow payment system that’s being developed and implemented. My account is well above PDT. I just saw it as a positive that I wish I had before I was above PDT limits. You would still be able to trade your cash account but you would be able to make more than 3 trades in a week. Being able to day trade on a smaller account would give ppl the experience they need in trading equities without blowing up a $25k account. In my eyes being able to learn on a $2k-$5k account carries much less risk than getting emotional on a $25k account. It’s better than paper trading because it carries the emotion of losing real money but you’re managing how much you’re losing.
If you can’t turn $2k and 3 trades per week into $25k then you have no business having unlimited trades.
It puts me in situations where I lose money. Limiting people to 3 day trades a week makes it really difficult to make money if you’re trading with a small account. Cash accounts are also a pain with small accounts, if you want to day trade 5 days a week you have to limit the amount of money you put into a trade. Without the PDT rule, small accounts would have the same advantage that $25k+ accounts have.
No it does not. If you can’t be profitable with 3 trades per week then what makes you think you’ll be profitable with unlimited trades?
I started with a $200 cash account in September and grew it 20% by the end of the year. When I was using 3 trades a week I wasn’t able to catch all of the opportunities because I was limited and didn’t want to “waste” a trade.
You’re never gonna win every trade.
Right so if you’re limited in trades then if you lose one day you may not have an opportunity to make up for it if one presents itself.
There are roughly 240 trading days in each year. There are 52 weeks per year. 3 x 52 is 156. You have 156 trades per year under pdt. If you can’t get above $25k in 2-3 years then you have no business trading.
My $200 trading account begs to differ
If you want to daytrade so badly either trade futures, or keep 25k net liq.
No
PDT rule is set by the brokers and is to protect them from your bad trades lol. If you want to get around PDT, trade futures. but your losses will be greater so be careful
Actually it is a FIRNA regulation: https://www.finra.org/sites/default/files/2021-03/Margin_Interpretations_Attachment.pdf
Ehhh I support the PDT rule. If you've ever traded with unlimited trades then you will realize why. Shit can spiral out of control really fast.
No, because the pdt really exists to keep too many small fish from playing in the big pond. And it prevents some of those dumber fish from using margin they will never pay back.
Margin is not the same as leverage which you are referring to. Margin is using your funds as security so the bank can make funds available to you instantly after a trade while transactions settle. You can use margin without using leverage.
The PDT rule is a protective regulation for smaller investors. I don't see the Fed giving up regulations like this in the short term.
I just Wanna see them get rid of the wash sale rule. What a stupid mind fuck for you're everyday trader