I traded stocks many years and then in 96 went into futures which I really regret. For me I found it much easier to diversify with stocks. I may have 6 stock positions and not all will do the same thing a couple may stop out and 1or 2 may make some good money. With index futures your whole egg is in that one trade. Your are able to diversify with futures by going into other markets but trading currency or grains/ others have a huge learning curve( my fav was cattle). This is just my simple opinion, I am sure there are more sophisticated traders than me. I do have a small account that I am trading and the PTD rule is terrible and I really understand if your acct is under 25k you are really hamstrung to trade stocks.
Because my account has fallen below 25K I have been forced to curtail my trading. Now with my online broker, after I have made three daytrades, I can only enter a trade if I acknowledge that my account is restricted and I promise to hold the trade overnight. What I have to do, in effect, is to enter the trade without being able to enter a stop loss with it. To me, that is the most riskiest trading imaginable. I am forced to hold overnight with all the problems associated with that kind of trading. I really don't think that the government regulators, who thought that they were trying to lower risk involved in trading for smaller players, had in mind that their regulations would impose this kind of unlimited risk. In effect it has created just the opposite condition than what they had in mind. So I have to be very careful with my trading. I have lowered my position size and institute my trades within the last hour of the trading day when there is little chance of an unexpected revelation and there is a clearer picture of how the market will open the next day. To say the least, with the new rules, I am no longer a daytrader but a swing trader, holding overnight and selling on the open or pre-market if things are not going my way. If I am positive then I am loathe to sell and take my profits but hold on to the gain for as long as possible because I have already undergone the punishment of holding overnight. I will say, though, that my stock selection has improved and the mistakes that I used to make because I traded when there were no good setups have diminished considerably but I still get the jitters when I am in a trade and I can't set a stop loss. I feel totally helpless and not at all in control of the situation. If there is anyone out there under the same situation or has any practical advice to give me I would appreciate hearing from them. Good trading Steve
I split my money into two accounts and this gave me six trades a week but reduced my buying power. It does tend to make you a little more picky about the setups but this is offset by hanging onto losers because you dont want to use up your bullets. An altogether unacceptable situation. The only answers I could find was either take up swing trading or switch to the eminis.
I believe you can still set that all-important stop. If I understand it correctly you'll be subject to a margin call if the stop is triggered but that may be better than taking a huge hit. Plus, I believe the margin call only has to be in the account for 48 hours. I could be way off on this because every broker can be somewhat different and the rules seem to be confusing to many. Mike