Margin Guide

Pattern Day Trader Scenarios

Review the pattern day trader examples below. Our scenarios cover cases involving assets over and under $25,000.

Scenario 1 : Assets over $25,000

Mia has $30,000 in her margin account. Her trading activities for the past week are as follows: margin-pdt-scenario-1.png

She became a pattern day trader because she did 4 (more than 3) day trades in 5 business days. But since she has over $25,000 in her margin account, being listed as a pattern day trader will not influence her trading privileges as long as her account value remains above $25,000.

Scenario 2 : Assets under $25,000

Jeff has $20,000 in his margin account. His trading activities for the past week are as follows: margin-pdt-scenario-2.png

He became a pattern day trader because he did 4 (more than 3) day trades in 5 business days. Since his account has less than $25,000 in assets, he can no longer do day trades until he deposits more funds to his account in order to maintain a total account value of over $25,000.