Articles on: Emma Invest 🇬🇧

What is Pattern Day Trading?

The good news is, we don't place any limits on the number of stock orders you place 💪 🚀

However, Financial Industry Regulatory Authority (FINRA), a trading governing body in the US, set a restriction on "pattern day trading" (PDT).

Pattern day trading is defined as a round-trip pair of trades within the same day (including extended hours). This includes:

An opening buy order followed by a closing sell order on the same day.
An opening sell order followed by a closing buy order on the same day.

An account is designated as a Pattern Day Trader if it makes 4 day trades within 5 business days. Executing 3 day trades or less within 5 business days will not designate the account as pattern day trader (PDT) status.

If potential Pattern Day Trading activity is flagged on your account by the broker we use to buy and sell US stocks on your behalf, your account may be restricted from further trading.

If you have any further questions, reach out to us here ✍️

Updated on: 22/02/2023

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