#StockMarket #StockTrading #PatternDayTrader

What is a pattern day trader PDT? A pattern day trader (PDT) is a regulatory designation for those traders or investors that execute four or more day trades over the span of five business days using a margin account. The number of day trades must constitute more than 6% of the margin account's total trade activity during that five-day window.


If this occurs, the trader's account will be flagged as a PDT by their broker. The PDT designation places certain restrictions on further trading; this designation is put in place to discourage investors from trading excessively.

Understanding Pattern Day Traders
Pattern day traders may trade different types of securities, including stock options and short sales. Any type of trade will be accounted for, in terms of this designation, as long as they occur on the same day.

If there is a margin call, the pattern day trader will have five business days to answer it. Their trading will be restricted to that of two times the maintenance margin until the call has been met. Failing to address this issue after five business days will result in a 90-day cash restricted account status, or until such time that the issues have been resolved.1

Note that long and short positions that have been held overnight-but sold prior to new purchases of the same security the next day-are exempt from the PDT designation.
- Investopedia

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