What is The Pattern Day Trader (PDT) Rule in Stock Market Trading…



Everything you need to know about the PDT rule. Subscribe: https://goo.gl/poGZTm to get INSTANT alerts when I post a new video outlining my penny stock trading techniques

0:05 Tim Sykes, millionaire mentor and trader here explaining what is such a touchy topic, the Pattern Day Trader rule, otherwise known as the PDT rule.

0:15 If you have a US account, and you have under $25,000, you can only make three-day trades per week, per five rolling day period. A day trade is in and out of a stock the same day. You can have unlimited trades overnight. You can hold the stock long or short, overnight, every single night, like it buy it one day, sell it the next. There are no limits on that.

0:40 This is just a rule designed by the SEC to protect newbies and beginners and people with small accounts, frankly, from themselves. I used to dislike the PDT rule. I was like, screw this! I want to be able to trade as much as I can.

1:05 I respect the PDT rule because I think it’s essential for newbies to trade less. This is why brokers don’t necessarily love me, but it’s the truth. This is how I create millionaires from scratch, by teaching you patience.

1:20 You do not need to make more than three-day trades per week. Again, you can hold the stock overnight, so you can make three-day trades per week and then also hold the stock overnight. So you make four trades or five trades or seven trades a week.

2:20 I think too many newbies get too excited to trade a lot, and they want to learn. They want to tinker and trade. I would encourage you to use stockstotrade.com software.

2:30 They have paper money where you’re not risking any money, and you’re trading like a fantasy account. That way, you can test with no risk. You don’t have to breach any PDT rule. You don’t have to over-trade yourself into oblivion and have a lot of commissions or, again, if you use a commission-free broker, trade yourself into frustration because you’re just over-trading.

3:30 A lot of you guys have to pay attention and listen to the things that I had to learn the hard way. I never had a teacher. So I wish I had someone telling me this stuff when I was first beginning. The PDT rule is not something to be scared of. It’s not something to be upset about. It’s not something to be avoided. I know there are brokers out there, they’re like, “Oh, escape the PDT rule.” I wouldn’t use any of them.

4:00 I think the PDT rule is reasonable. It keeps you in check. And it forces you, primarily to get above $25,000. You know, I go back to $12,000 every year in one of my Etrade accounts to try to grow it. And usually every year I double it or triple it or quadruple it, in front of my students, to show how you can do it. And it forces you to be much more meticulous. It forces you to trade like a pro.

4:20 I highly encourage you to start to love the PDT rule. Do not try to avoid it. Do not use leverage. Do not try to put in more than $25,000 in your account at first. I would encourage you to start small.

4:45 The lessons that you learn growing your account when it’s small, I know it’s not a lot of money, but you’re not going to make a lot of money in your first few weeks or months anyway. So get that out of your head. It’s much more important to develop a proper trading process and be disciplined in the beginning.

5:00 I think the PDT rule is reasonable. Don’t get upset about it. This has been another video of Tim’s Tips.

Thank you for watching my videos. I hope that they help you. I want to share everything that I’ve learned over the years. You can check out more videos right over there. And also click Subscribe so that you can watch all of these videos, get that knowledge, and become my next millionaire student.

* Results may not be typical and may vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here: https://www.timothysykes.com/terms-of-service/

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34 thoughts on “What is The Pattern Day Trader (PDT) Rule in Stock Market Trading…

  1. Garret Liones

    Ok. But this doesn't help when you're marked as a pattern day trader. Now I have to use a different broker.

  2. Erik Santos

    Wow this is very valuable content! Very legit. I know bc I paid $900 for a course for this

  3. Joe Labi

    Oh ya I've registered a demo or bonus with terms ac.. maybe can do little experiment about what I've learnt with it..

  4. Joe Labi

    PDT rule? Not so familiar or maybe something i forgot.. Will do a revise.. Oh ya Good evening Tim.. my plan is to do real trade around October or November and for this time being i will try to absorb the idea which you've teached and to be honest I'm a slow learner.. hope you can be patient with me ??

  5. Rayden2688

    You know what Tim ?, I'm, still studying over and over again, and this video is really a wake up call , too you are right, I never thought that this could get addictive, I promise I am studying and looking forward to being your student. I am glad now I botched it up when I tried to be your student earlier, it was meant to be , but I k ow I will be a student…. Everyone who doubts you are very wrong ,, people get wise and no matter how long it takes ,, believe in Tim , thanxx Tim .. see you on the other side lol…

  6. Alex Huynh

    TL:DR- PDT is cancer to the stock market and forces noobs to have to make better plays for 2/3 wins in a week. rich get richer scheme created by the SEC influenced by the rich.

  7. Richard Yancy

    You can try to rationalize the PDT rule in any number of ways but it is a case of too much government. Trading too much may be a problem for a lot of traders but they don't need more government to control them.

  8. Liam Tanner

    When I had STT (I'll for sure get it again), I paper traded only 3 days and I took the 500 initial, and grew it 140% to ~1200. When I start trading real money, maybe I'll be on track to becoming a full time trader by the end of the year. I won't get my hopes up, but I'll do my best, study hard, and learn as much as I can!

  9. bob weiss

    I'm getting very frustrated. Just not trading properly. Getting discouraged. I can read and read and watch ur video's but over the years I have learned from people I was in the field with and than tweaked it. Like Mechanics, I've been in the field for over 30+yrs. Have awards from ASE for being master for over 25+yrs. But was forced to retire because of Medical issues. But Just wish I could sit next to someone who can literally show me what to do and the signs of what to look for one on one. For some reason it sinks into my Brain better. Well Thanks Tim for all your video lessons and the Penny Stock book I purchased. Yeah I know about PDT rule hit it twice.

  10. Brutus Empire

    WHY DON'T YOU GET ALL THE BROKERS TO GET THIS PDT RULE DROPPED??!! NO ONE WANTS TO BE LIMITED.

  11. SAYON NANDI

    I have a very control budget that's why I need to utilize my single worth of a penny.
    Tim Sir, For example – Like me as a newbie at first, if I do paper trading with your penny stocking silver($150) or Tim Real-Time($75) alert subscription and try this market just to see? what do you think? Which option I should prefer ($150) or ($75) as a beginner?????????
    I don't have $3000 to buy your expensive study material. I do a part-time job with my bachelor study. I will buy these stuff with the passage of time, don't worry! I read your all free blog posts, watched every free video, attended free webinar's and also study that 7-day challenge. It really helped me to understand what should I do with my future!

    So, on a monthly basis, what should I choose? penny stocking silver ($150) + 1month stocks to trade expense ($176) = Total ($326) OR Tim Real-Time alert ($75) + 1month stocks to trade expense ($176) = Total ($251). I have a very limited time. Your suggestion will help me a lot.
    what do think which option can I do better?
    Sorry if I asked the wrong question but I am confused, I don't wanna waste a penny. I just wanna be very careful from start.

  12. Tony Arvizu

    Hey mister Sykes, I want to get into this, Im 37 been doing labor all my life and haven't really been in social media too much, so I'm kinda coming out of my cave. All this is foreign to me. Is there a way I could message you in some social media? The only thing I have is this and twitter I think but I'm not on there I have an old facebook. Just wanted to see if you could get me started like tell me what kind of equipment I would need. Just a laptop?

  13. Gary Smith

    Nice video. Please correct me if I am wrong, but you can also add to your position and scale out of a stock all in one day, and those won't count against you as day trades.

  14. kevin flynn

    what about cash accounts they let me trade all day as long as i have the funds available

  15. NintendoFan021

    THANK YOU Tim. I just heard of the PDT last week and I was like, what the hell are you seriousss?? But this video came out with perfect timing, and now I don't feel as bad about it anymore. I was also unsure about short-selling last week, then that "How To Short Sell Penny Stocks" video came out at the perfect time as well. So thank you for your weekly uploads on top of your DVDs mannn. You da best prof!

  16. Bat Scientist

    Nice one Tim. I'd love to get your opinion on how to trade under the FINRA 3210 rule

Comments are closed.