IB account falls below $25K

Discussion in 'Interactive Brokers' started by deadreader, Aug 13, 2003.

  1. I have roughly 30,000 in my IB stock margin account. I actively trade stocks, 5 round-trips a day at least. If my account were to fall below 25K would it be 'frozen' for 90 days?
     
  2. Steve_IB

    Steve_IB Interactive Brokers

    You would not be able to trade until either:
    1. 90 days have elapsed from your last trade, or
    2. You submit funds to bring your account back over $25k
     
  3. Why??
     
  4. def

    def Sponsor

    Those are the PDT rules set by the NYSE and NASD.
     
  5. Steve_IB

    Steve_IB Interactive Brokers

    It's the NYSE and NASD rules on Pattern Day Trading - summary:

    o Customers who have made four or more securities day trades (open and close a stock or option position in a single day) within five business days are considered “Pattern Day Traders”.

    o Customers who are Pattern Day Traders and have less than $25000 in equity will not be allowed to place additional opening orders. Any customer that has been flagged as a Pattern Day Trader will have this designation for 90 days from the date that the pattern was most recently established.

    o The above restrictions do not apply to customers with over $25000 in equity.

    Please note that the NYSE requires these rules to be followed by all brokerage firms.


    For IB:
    o For customers that have less than $25000 in equity, IB allows only 3 day trades in a 5 day period to ensure that customers to do not acquire the PDT status that triggers the 90 day opening trade prohibition. After 3 trades, customers will be allowed to open new positions in 1-5 days depending on the previous day trade activity. Closing trades are always permitted without restriction.
     
  6. Wow! That's brutal. I thought that IB's policy was the PDT reg. I didn't realize you were protecting me from Big Brother. Thx again...
     
  7. Well, maybe you should have a european broker. We don't know or use such foolish rules.
     
  8. Do you guys have any discount brokers similar to IB? I've got a couple of relatively small accounts and can't afford high commissions.
     
  9. Also: can you trade NYSE and NASDAQ issues from a European broker? (Please forgive my ignorance!)
     
  10. Weeble

    Weeble

    THE CITIZENS OF THE USA SHOULD BE OUTRAGED BY THESE PDT RULES. I CAN'T BELIEVE THEY'RE STILL IN FORCE.

    I THOUGHT AMERICA WAS A FREE COUNTRY, THE LAND OF OPPORTUNITY AND FAIRNESS.
     
    #10     Aug 14, 2003