Currently the PDT requirement is $25,000. FINRA is proposing to reduce it to $2,000. This is rule has a big effect on smaller options traders. With this change, there could be substantially more retail volume. https://www.tradingview.com/news/fi...millions-from-day-trading-is-about-to-change/
The whole PDT rule was typical Washington political BS logic. You lock small traders out of the Equity markets but you allow them in the futures markets. PDT was redic. Sure change this rule to 2k min, since most Brokerages require that or a bit more to open an account... But stopping Congressional reps & US Bureaucrats from insider trading would be a better law.
I don't know about smart but certainly sending them to futures was catastrophic. My guess is that CME and ICE will fight it.
Didn't they also introduce 4:1 day trading buying power for PDT traders at the same time as the rule was introduced. Before the rule came in it was just regular 2:1 margin buying power. Will they remove 4:1 or keep it? I guess the brokers will want them to keep it for the extra fees they earn.
PDT, while it seems like a barrier coming from too much bureaucracy, actually stopped many from losing their hard-earned little money. Always have in mind that day trading is the quickest way to lose your funds. And if they are going to allow people to day trade with 2K the carnage is going to be brutal. Maybe it will also enable something else; people will be able to get rid of prop firm scams.
I am in favor of the PDT rule. However, i agree pushing them to futures is a scam (and probably some bribes were paid). And stopping congress from insider trading is the one policy all of America agrees on, save for 535 people.
By that same logic, all casinos and sports betting should be banned too. But the tax revenues are way too good for the government to ignore, turn down. Evil wins, idealism loses.
Something or anything to keep the revenue stream flowing. 99% of people will get wiped out. Lowering the bar only means the market is hungry for the hopeful, arrogant, inept, careless to dump money in. The minute volitilty will be neglagable. If you are still in the game after 25 years then you know what might be being setup. I am still waiting for FXCM to come back stateside. Akuma Gold!
No one said anything about banning. One of the biggest scams out there is the lotto, and that is literally run by governments. There are scams everywhere, but some of them can wipe your account really fast. Everyone knows that casinos are scams, but not everyone knows that day trading is the quickest way to wipe out your account. Casinos are directly linked to a gambling problem, when they both should be inked the same way. It is not idealism, it is common sense.
I agree with you on the 535 angels in congress being in favor of Insider Trading... but why do you think the PDT rule is good when it is an example of the US Government always over regulating free enterprise (as in US Gov is always over regulating... getting in the way of "life, liberty and the pursuit of happiness"... as part of all American rights). Whether we Win or Lose in the financial Markets short term or long term is not important. Life is complex and is not simplified by government edict. If people blow out their account(s), even multiple times, due to their style/timeframe of trading yes it is traumatic but it is the best way to LEARN Risk Management and have it stamped indelibly on your brain. It is part of the Gauntlet of life. Other wise everyone turns, which they have, to poker, sports betting, horse racing, etc., etc., and learn it that way. The political act to regulate ambition is always doomed to fail. ~