Under FINRA regulations, if you are in a margin account, you will be flagged as a pattern day trader (“PDT”) if you make 4, or more day trades, within 5 consecutive business days.
If your account is flagged as a PDT and you wish to day trade, you must close the previous business day with at least $25,000 in cash and securities (excluding crypto, alts, 6-month Treasury Accounts, Bond Accounts, Treasury Accounts, or High Yield Cash Account balances). If you maintain balances in equities and cash over $25,000, you are able to day-trade in the amount up to your day trading buying power.
Being flagged as a pattern day trader will result in an Equity Maintenance call. The Equity Maintenance call amount will be the difference between $25,000 and your total account balance, including equities and cash. For example, if you have $1,000 in cash and equities, then your Equity Maintenance call would be $24,000.
If your account is flagged as PDT and you exceed your day trading buying power, a day trade margin call is issued.
If you are issued a Day Trading margin call, DT Call, you have up to 4 business days (T+3) to meet the call in an unrestricted account by depositing cash into your account or marginable securities. Funds deposited to meet a day trade margin call must remain in the account for a minimum of the deposit day plus two business days. Any additional overspending of day trading buying power will increase the call amount.
If you fail to meet the call within this period, your account will be further restricted to closing positions only for 90 days. When restricted for unmet day trade calls, removing the PDT flag, or converting the account to cash will not remove the restriction.
At the start of the day, you can find your initial day trading buying power on the ‘Margin Management’ screens. If you make a large deposit or sale during the day, this will not increase your day trade buying power until the subsequent market day.
The margin management screen is located by:
Clicking on the menu icon, ≡, either at the top left of the mobile app, or top right of the web page.
Select “Account Settings”
Select “Margin Management”