Oh but hello Mr. $1,800 in his account. We see you have no prior trading experience, but don’t worry, we’ve approved you to trade all sorts of derivatives! Wanna buy SPY options expiring next week? No problem buddy!

Oh hold on a second. You wanted to sell those options 60 seconds later for a 5% gain? OK well you can only do that two more times this week. However, if your willing to hold the derivatives overnight, feel free to do that as many times as you want! Yeah, cause holding overnight is totally less risky than being able to sell at any time.

PDT is obviously complete BS, because current rules and regulations allow for absolutely maniacal levels of risk, as evidenced by the loss porn on WSB. Any trader could turn $1,000,000 into $0 with minimal effort, so the idea that preventing traders with less than $25,000 in their accounts from aggressively scalping is somehow protecting them is laughable.

If protecting retail traders was truly the concern there would be much stricter rules around trading short-dated derivatives.

Scalping can be a high probability strategy and all should be allowed to participate if they desire.

What do others think? Any legit reasons for PDT or is it just a forgotten/outdated legacy rule?

submitted by /u/ClaytonBigsby2020
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Author Of this post: /u/ClaytonBigsby2020
Title Of post: Why is PDT still a rule? The SEC’s reason of “protecting the same kind of investors who got burned in the dot com bubble” makes 0 sense.
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