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Strategies & Market Trends : Momentum Daytrading - Tricks of the Trade -- Ignore unavailable to you. Want to Upgrade?

To: Dan Duchardt who wrote (2057)	2/12/2000 3:16:00 PM
From: Wayners	Read Replies (1) \| Respond to of 2120

As you guessed I was referring to margin accounts. We're in agreement on this one. This rule is going to be used to stop people with less than $25K from day trading. However they might or should grandfather people that have already established a margin account with a broker with less than $25K. Any newly established margin account might be subject to the rule. I'm just speculating. I just can't imagine them taking away somebody's previously established margin account unless the person's creditworthiness was somehow in question. Another offshoot would be if no margin account--no shorting stocks either. I guess that means no covered calls or covered puts either for that matter. I did not know about that NYSE rule 431 either. I assume Nasdaq allows day trading in a cash account. I place all trades in a margin account period even when not using any margin. I don't know anything about the x 4 multiplier. I'm going to have to look at the Notice of Proposed Rulemaking to see what it says.

To: Dan Duchardt who wrote (2057)	2/12/2000 3:29:00 PM
From: Wayners	Read Replies (1) \| Respond to of 2120

Here is the text of the actual rule change. Doesn't affect Nasdaq at all. Its changes to NYSe Rule 431. sec.gov

To: Dan Duchardt who wrote (2057)	2/12/2000 3:56:00 PM
From: Wayners	Read Replies (1) \| Respond to of 2120

I read the proposed rule. Thats some serious stuff especially the 4 x rule. As I interpret that, the number of day trades that one can do in a single day will be greatly restricted no matter how much money you have in your account. For example if you have $50,000 in your account and you flip buy and sell $50,000 worth of LU for example four times in a day, you've used up your "special margin" of 4 x $50,0000 = $200,000.00 This 4 x rule as I read it applied to EVERYBODY regardless of equity.