Another PDT thread :)

Discussion in 'Retail Brokers' started by newestmember, Oct 17, 2003.

  1. I want my new IB account to AVOID being tagged with the 'PDT' designation. (It's over 25K, but this is a swingtrading account and I don't want it locked if it falls below 25K).

    Here are the important questions:

    1) I short 1000 shares, all in one order, but later (in the day) cover those shares in 2 completely different orders. How many daytrades does that make?

    2) I short 100 shares in one order, then another 100 shares in a different (new)order. An hour later, I cover the 200 shares in one order. How many daytrades does that make?

    3) I short 1000 shares, all in one order, but later (in the day), I cover those shares in one limit order. But whoops, I only get a partial fill (say, 500 shares fill but 500 shares are still active), can I move the active limit order to a different price (to get filled) without it counting as more than one daytrade?

    Lastly, it's absolutely ridiculous that this is what the PDT rule has come to..............
  2. 1) One
    2) Two
    3) Two!!!!

    IB told me that if I place an order to cover that doesn't fill completely, that if I modify the original order and the rest gets filled, it will count as TWO DAYTRADES.

    Inotherwords, if you want to avoid the PDT designation, but you get a lousy fill, you have to wait until the next day to fill the rest of the order.........
  3. In a chat with IB help, I was told THE EXACT opposite answers for question one and two!!!!!!!!!!!!!!!!

    Not even IB knows how it handles the PDT rule!
  4. PDT sucks
  5. hermn


    I received a similar reply when I asked about selling one half of a daytraded option position to take some profit off of the table and selling the second half later in the day (hopefully for greater profit). Same answer ---- two trades.

    I accepted the answer but I have to question where it says that in the rules I have read. It is the same vehicle.

    So here is a question if you place a market order and it fills at three different prices and you close the position the same day with another market order that fills at three different prices, what do you have

    a) One day trade
    b) Three day trades
    c) Six day trades and you are now out of the trading business.

  6. And with IB email support.

    In the end, IB told me that if I sell short 1000 shares, I can cover it HOWEVER I WANT (one order, two orders, 200 orders) and it'll all count as ONE DAYTRADE.

    On the other hand, if I place two different sell short orders for 100 shares, and cover them in one order for 200 shares, that's TWO DAYTRADES.

    Also, Any "modification" of an entry order is considered ANOTHER DAYTRADE, so if you enter a limit order to sell short 1000 shares, and it only partially fills, and you modify it to get it filled, then two (or more, depending on the number of times you modify) daytrades will be counted if you cover that position in the same day........

    I'm still hammering out the details with IB chat right now, actually, and it's become very apparent to me that it's IB who has interpreted the rules in this way, not the Nasdaq, not the SEC. Hell, even IBs own reps don't understand what's going on!
  7. My answer:

    1) One
    2) One
    3) One

    I used to
    scale in (+100, +100, +100, ...)
    and scale out (-100, -100, -100, ...)

    - and it was always counted as one daytrade by IB TWS.

  8. mrpace


    What if you go long 1000 shares and only sell 500 shares by end of day. The NEXT day you sell the rest.

    Does the partial sale count as 1 daytrade? Or, because you sold the rest of the position the next day, does it not count as a daytrade at all?

    I guess what I'm asking is if you sell or cover only part of your position on the day it was opened, but leave the rest for another day, does this count as a daytrade under the PDT rule?
  9. mrpace


    Wow, I just realized I revived a 2 year old thread....:eek:
  10. LOL

    I might just add to all this (albeit belatedly) "why mess with daytrading stocks at all?"

    Daytrade index futures where no PDT rules apply. PDT *does* suck, so don't fight it.
    #10     Nov 3, 2005