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

To: Wayners who wrote (2061)	2/12/2000 4:17:00 PM
From: Dan Duchardt	Read Replies (1) \| Respond to of 2120

Wayne, 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. The NASD version at least has a specific provision allowing for more buying than that. (ED: I just checked the NYSE version. It has the same provision. The words are identical I think.) Whenever daytrading occurs in a customer's margin account the special maintenance margin required for the day trades in equity securities shall be 25% of the cost of all the day trades made during the day. For non-equity securities, the special maintenance margin shall be as required pursuant to the other provisions of this Rule. Alternatively, when two or more day trades occur on the same day in the same customer's account, the margin required may be computed utilizing the highest (dollar amount) open position during that day. To utilize the highest open position computation method, a record showing the "time and tick" of each trade must be maintained to document the sequence in which each day trade was completed. (I removed text marked for deletion.) Dan ED: Just read your last note. We need to get in phase <g>