Pattern Day Trader


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Pattern Day Trader

A designation by the SEC of an investor who conducts more than four day trades in any five, consecutive trading days and for whom these trades make up at least 6% of his/her total trading activity. Because of the risk inherent to day trading, the SEC requires all pattern day traders to maintain at least $25,000 in equity in a margin account.
References in periodicals archive ?
A pattern day trader is an individual that executes four or more day trades within five business days.
A pattern day trader is generally defined as a customer who day trades four or more times in five business days.
They also lack some of the disadvantages active traders are now facing, including decimalization issues, liquidity issues, and Pattern Day Trader account requirements, such as the $25,000 minimum account requirement.