DAYTRADING Fundamentals Message Board

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Strategies & Market Trends : DAYTRADING Fundamentals

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To: shneed who wrote (10032)	9/2/2000 11:39:31 AM
From: OZ	Read Replies (2) of 18137

Buying or trading the same securities more than 2 or 3 times. Using the same funds to purchase other securities from the previous day The worst thing one can do to buying power is to sell a position that was held overnight in the morning and then after trading in and out of several other positions in different stocks the next day, buy it back. The trade is now considered a "day trade" and if the sum of the value of all transactions after the initial morning sale (i.e. "selling into a gap) up to the repurchase of the previously held stock exceeds ones buying power, a daytrading margin call will occur for what seems like an obscene figure. It is a ridiculous fallacy in the system that will be corrected if the new margin requirments are implemented. As far as your broker being "wrong', that is highly unlikely since the house can make its own rules if they are MORE stringent than the mandated guidelines. Sounds like you might be using a discount versus a direct access broker. Oz

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