PDT Rule (Pattern Day Trader)
A FINRA regulation requiring traders who execute 4 or more day trades in 5 business days to maintain a minimum $25,000 account balance.
Explained Simply
The Pattern Day Trader (PDT) rule applies to margin accounts at US brokers. If you make 4+ day trades (buy and sell the same stock in the same day) within a rolling 5-business-day window, FINRA classifies you as a Pattern Day Trader. Once flagged, you must maintain $25,000 in your account at all times to continue day trading. If you fall below $25,000, you're restricted to 3 day trades per 5-business-day period. Cash accounts and accounts above $25,000 are not restricted.
How Tradewink Uses PDT Rule (Pattern Day Trader)
Tradewink's RiskManager actively tracks your day trade round trips and syncs with your broker's authoritative PDT count on every scan cycle. If PDT remaining rounds are at 0, the day trading scanner is automatically paused to prevent regulatory violations. Users are alerted via Discord when they're approaching their PDT limit. This prevents the frustrating situation of entering a trade you cannot close.
Related Terms
See PDT Rule (Pattern Day Trader) in action
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