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Pastimes : Clown-Free Zone... sorry, no clowns allowed -- Ignore unavailable to you. Want to Upgrade?

To: pater tenebrarum who wrote (99360)	5/3/2001 3:05:34 PM
From: Jack of All Trades	Read Replies (1) \| Respond to of 436258

No problem except SANM spiked close to 3pts or 10% after posting that... About 1/2 hr ago was a good time to short it... Somebody must be out to get me...

To: pater tenebrarum who wrote (99360)	5/3/2001 3:06:50 PM
From: Lee Lichterman III	Read Replies (1) \| Respond to of 436258

If you can't print enough money to make it go up and you can't ignore enough bad news to make it go up, provide more margin leverage to make it go up. UNBELIEVABLE!!!!!!!............... From: eric012 Thursday, May 3, 2001 1:35 PM Respond to of 32596 Major New Margin Rules: Major food for thought. This is a partial cut-n-paste of the weekly column 'Superior Execution Forum" from Rogan Labier at www.hardrightedge.com. ############################## Superior Execution Forum 05/02/01 By M. Rogan LaBier (Copied) Welcome to the Tools of the Trade Superior Execution Forum. In this weekly column, former market maker and head trader M. Rogan LaBier answers questions about Online Trading. From: www.hardrightedge.com I trade with XXXXXXXXX, an online broker. I'm considering moving to a “direct access” broker in several months. But I hear there is a new margin situation. What is it, exactly?? - Ronald D. Rogan - There are significant, sweeping changes in the pipeline. They were approved February 27, and will take effect on September 28 of this year. Here is a short primer on what the new rules will do: The new rules finally define exactly what a “Pattern Day Trader” is: any customer who day trades four or more times in five business days, and such activity is more than six percent of that customer's total trading activity for the five-day period. If the “Day Trades” do not account for more than six percent of total trading activity in that period, the clearing firm will not be required to designate the account as PDT. However, in practice, one should not expect his account to be re-classified every time he stops day trading for a few days. More likely, is that if the trader opens a standard investment account, and qualifies as a day trader at some point, his account will be immediately re-classified, for good, as a PDT account. New Minimum Equity Requirement for all PDT accounts: $25000. Increased Buying Power: Under the new regs, pattern day traders will have buying power equal to four times the day trader's maintenance margin excess. This is an increase from the current two times maintenance margin excess. Overnight Holds: Rules are amended, so that the sale of an overnight position is treated as a liquidation and the subsequent repurchase as the establishment of a new position. This should help, by ending the current confusion, and make unnecessary the adage: “if you hold it over night, do not trade it the next day” Trading Call Changes: Cross Guarantees Prohibited: Pattern day traders will not be permitted to meet day trading margin requirements through the use of cross guarantees (another account lends the money to cover the call). Accounts that have incurred trading calls will have buying power restricted to two times the maintenance margin excess until the call is met. Funds must remain in account for minimum two days: Funds used to meet a trading call must remain in the customer's account for two business days following the close of business on any day when the deposit is required. So the new regs are a mixed bag. Arguments often heard in support of the above regs, when in proposal stage, often went like this: Since day trading is a highly risky endeavor, in order to encourage suitability of traders, and lessen their (overall) risk, the proposals should be introduced…. Those against the new proposals often countered – if the true purpose is to lessen overall risk by encouraging higher suitability (higher levels of disposable cash) they why in the world would you require more money to begin with, and then double current buying power intraday? Some readers have even gone as far as to suggest conspiracies, that because traders are starting to transact such large proportions of share-volume on the exchanges (ISLD alone did 8% of the total volume on the Nasdaq in February, for instance) the institutions, who are being hurt by this, have backed these new regs to keep newbies out of the game. I don’t necessarily ascribe to these sorts of theories – day trading is highly risky, and under capitalization is a major reason some traders go under. Nevertheless, my personal opinion is that a trader should be made completely aware of all the heavy risks involved, and then be allowed to make his own decision, based on his particular life situation, as it applies to current suitability tests. In any case, my opinion is irrelevant; the comment period passed long ago, and the ruling is final. Message 15750704 They should be REDUCING margin NOT raising it!!!!! I read earlier this week that Schwab was giving 35% margin requirements instead of 50% last week. Heck, let's just shutdown industry, convert all the factories into money printing facilities and then sit in a circle bidding stocks higher and then passing them to the guy next to you who bids higher than you. This news makes me seriously consider just pinching my nose and going long, FA be damned. Sorry for the rant but this is just plain insane!