Pattern Day Trading

The Financial Industry Regulatory Authority (FINRA) defines Pattern Day Trading (PDT) rules. Pattern Day Trading is defined as engaging in four or more day trades within a 5 business day period. Day trading can only be done within a margin account. 

What is a Day Trade?

A Day Trade occurs when you buy and sell the same equity within a single trading day.

Pattern Day Trader Status

If you engage in pattern day trading, your account is marked as a Pattern Day Trader, and you must meet PDT requirements.

PDT requirements state that in order to continue making Day Trades, you must close the following trading day with an account balance of at least $25,000. This account balance can include both cash and equity holdings. 

If the balance of your account drops below $25,000, then you can no longer engage in Pattern Day Trading until the balance is brought above the threshold of $25,000.

Do PDT Requirements Apply to Crypto Trades?

PDT requirements only apply to equity assets. Crypto is not subject to PDT regulations.

Leverage

At this time, there is no leverage available for day trading at Composer.

Access to Composer’s Run Now, Buy Now, Sell Now Features

At Composer, we require that your account meet the PDT minimum of $25,000 in order to use our Run Now, Buy Now, and Sell Now features to trade equities in your Stocks or Stocks + Crypto account. 

For crypto trading, there are no account minimums required to use these features. 

Additionally, Run Now, Buy Now, Sell Now features are not currently available within Composer IRAs or within Composer Stocks accounts held with Apex, one of our brokerage partners.