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Posted by kflk235 on :
 
Does Ameritrade even allow day trading??? I'm new to trading, but in reading Ameritrade's rules.....it seems they flag accounts that have had 4 or more trades in 5 or less business days. Can someone please shed some light on this.
 
Posted by gbarton13 on :
 
I believe you have to qualify as a daytrader with them before they will allow you to act like one. It is usually having like $25,000 in your account in all times and such. I know it is kinda like that with E*Trade.
 
Posted by Nemesis on :
 
quote:
Originally posted by gbarton13:
I believe you have to qualify as a daytrader with them before they will allow you to act like one. It is usually having like $25,000 in your account in all times and such. I know it is kinda like that with E*Trade.

I use Ameritrade and gbarton13 is correct. To make more then 4 round trip trades within a 5 day period you will need $25,000 in you account at all times.
 


Posted by kbpkt on :
 
I may be wrong, but my understanding is 4 round trip trades in 5 days, meaning that you have buy and sell, or sell and buy the same stock in the same day. By doing that 4 times in 5 days, you get flagged as a daytrader. However, buying today and selling tomorrow does not count as a round trip trade because the buying and selling were on different days. I can also buy and sell the same stock (roundtrip) 3 times in one day, then buy it the next day and sell it the day after that, and because the fourth buy/sell took place on different days, it does no count as a roundtrip trade, but I do have to wait 5 more days to make another roundtrip trade. Someone please correct me if I am wrong, but that is my understanding.
 
Posted by poorman on :
 
quote:
Originally posted by Nemesis:
I use Ameritrade and gbarton13 is correct. To make more then 4 round trip trades within a 5 day period you will need $25,000 in you account at all times.

This only happens if you make the trades with the same money.
Try splitting your money into three groups. Ie 3000.00 1 thousand for monday 1 thousand for Tuesday ect that way your money settles each time before you use it.
Also for newbies this will minimize your losses if, like me. you tend to pick stocks that go down at times. LOL

 


Posted by WINNER24 on :
 
its not just ameritrade, its a NASD regulation.. if you have a margin account and you make more than 3 'round trip' trades in a 5 day period. you are tagged a pattern daytrader to avoid this, you have to have at least 25K or better still, just have a cash account.
 
Posted by kyle0k on :
 
i have etrade. so if i buy and sell 4 "round trips" in one week i will get penalized?
 
Posted by WINNER24 on :
 
quote:
Originally posted by kyle0k:
i have etrade. so if i buy and sell 4 "round trips" in one week i will get penalized?

YES
 


Posted by kyle0k on :
 
hmmm,how drastic is this penalty?? i mean if we are talking about 5 dollars or 500 dollars.
 


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