PDT rule makes it difficult to grow small accounts quickly, please remove it.
If someone with an account value less than $25,000 buys multiple (4 or more, maybe including options) securities, and they are all profitable, they risk getting hit with the PDT rule if they close all of them to realize their profits.
To avoid getting hit with the rule, they would have to leave some of the profitable positions open until the next day, and take the risk that they may lose these profits before being able to close them the next day, only to hope that their trade becomes profitable again as quickly as before.
While the rule may have been made with good intent; i.e., to avoid churning, and brokers trying to make money off the higher commissions of the past, today, with low commissions, it doesn't seem necessary, especially now that some brokers don't charge commission on stock trades, and some charge a dollar or less on option trades, while others don't even charge for closing option trades.
And what does it say to the uninformed that government regulations are this strict on trading in a regulated market, while other government regulators allow you to gamble on sports without limit. Believe it or not, people actually (and incorrectly) think that legalized sport gambling is safer than the stock market. Otherwise, why would one be forced to close an account after four day trades, even if they trade well and made money the four day trades, while there is no government watch dog preventing that same person from gambling their savings away, even if they keep losing bet after bet.
It would also be nice to have consistency across different regulatory bodies. I don't know why futures don't have the same rules as stock investments. Why do Index futures allow day trading even if the account balance is under $25,000.and not ETFs on the respective index. Is Uncle Sam saying that futures are a far safer investment than stocks?
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Anonymous Comment On Regulatory Notice 24-13
PDT rule makes it difficult to grow small accounts quickly, please remove it.
If someone with an account value less than $25,000 buys multiple (4 or more, maybe including options) securities, and they are all profitable, they risk getting hit with the PDT rule if they close all of them to realize their profits.
To avoid getting hit with the rule, they would have to leave some of the profitable positions open until the next day, and take the risk that they may lose these profits before being able to close them the next day, only to hope that their trade becomes profitable again as quickly as before.
While the rule may have been made with good intent; i.e., to avoid churning, and brokers trying to make money off the higher commissions of the past, today, with low commissions, it doesn't seem necessary, especially now that some brokers don't charge commission on stock trades, and some charge a dollar or less on option trades, while others don't even charge for closing option trades.
And what does it say to the uninformed that government regulations are this strict on trading in a regulated market, while other government regulators allow you to gamble on sports without limit. Believe it or not, people actually (and incorrectly) think that legalized sport gambling is safer than the stock market. Otherwise, why would one be forced to close an account after four day trades, even if they trade well and made money the four day trades, while there is no government watch dog preventing that same person from gambling their savings away, even if they keep losing bet after bet.
It would also be nice to have consistency across different regulatory bodies. I don't know why futures don't have the same rules as stock investments. Why do Index futures allow day trading even if the account balance is under $25,000.and not ETFs on the respective index. Is Uncle Sam saying that futures are a far safer investment than stocks?
Thank you for your time.
-F.A.