Pattern Day Trader (PDT) Rule: What Changed in 2026

For over 20 years, the pattern day trader (PDT) rule required a $25,000 minimum balance to day trade freely in a margin account. In 2026 it was replaced: FINRA's new intraday margin standards took its place, and the $25,000 minimum went with it.

The old rule

• A day trade is buying and selling (or shorting and covering) the same stock on the same day.
• Making four or more day trades within five business days in a margin account (when they were more than 6% of the account's trades) made you a pattern day trader.
• Pattern day traders had to keep at least $25,000 in equity. Below that, the broker could restrict the account from day trading, often for 90 days.

What changed in 2026

The SEC approved FINRA's change to its margin rule (Rule 4210) in April 2026, and it took effect on June 4, 2026. The "pattern day trader" label and the $25,000 minimum were replaced by intraday margin standards: instead of counting day trades, brokers must make sure positions held during the day are covered by enough margin. The regular margin requirements for positions you hold stay as they were.

Firms were given time to switch over, so check your own broker: some may still apply the old limits for a while, and each broker sets its own intraday buying power and rules within the new standard.

Cash accounts

The PDT rule never applied to cash accounts, and the change doesn't alter how they work. In a cash account you can day trade with settled money, but sale proceeds settle one business day later (T+1). Using unsettled money to buy and sell again can cause a "good faith violation", and repeated violations can restrict the account.

What hasn't changed

Day trading is still risky. Fewer limits on how often you trade don't make small-cap momentum stocks any less volatile, and margin can magnify losses as well as gains. Decide how much you can afford to lose before you trade.

This guide explains the rule in general terms and isn't legal or financial advice. Your broker's terms are what apply to your account.