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FINRA Approves Removal of $25,000 Minimum Equity Rule for Pattern Day Trading

FINRA Approves Removal of $25,000 Minimum Equity Rule for Pattern Day Trading

The U.S. self-regulatory body has authorized amendments eliminating the long-standing capital requirement for pattern day traders, according to CNBC.

Fact Check
The statement is strongly supported by the evidence. A report from the FINRA Board of Governors meeting confirms it 'Approved Amendments for Pattern Day Trading Rules' (Source 7). A subsequent CNBC article explicitly links this news to the '$25,000 minimum equity rule,' reporting that day trading is 'about to get easier for smaller retail investors' following the FINRA news (Source 8). While earlier sources discuss proposals, these two recent sources confirm an official approval has been made.
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Summary

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Terms & Concepts
  • Pattern Day Trading Rule: A regulation requiring traders who execute four or more day trades in a five-business-day period to maintain a minimum of $25,000 in equity.
  • FINRA: The Financial Industry Regulatory Authority, a U.S. self-regulatory organization overseeing brokerage firms and exchange markets.