 PDT. We saw money gigs, Mr. V here. Welcome to another video, guys. So into this video, we are going to talk about the PDT rule in day trading. So this is something that's very important depending on the account type that you have. So again, this is part of our series on how to make $250 a day trading. So again, we started this series. We talked about basically choosing the platform that you need for trading. We talked about which account types that you have to open. Again, I'm going to hook the playlist for all of these right here so you can definitely go check it out. So we've talked about the platform. We talked about account types. We talked about your budget, which is very important, how much money you need to get started. So today, one of the most important things that you have to worry about is PDT, which is kind of like a control mechanism so that people that don't qualify or don't meet certain criteria don't go around trading and manipulating the market. So that's the thing. In my personal opinion, I think it's BS, but those are the rules we have to play by. So I want to cover that into this video, but before we get started guys, if you're new to the channel, we talk about how to earn money, how to save money, how to invest and build wealth. So that's something that interests you. Go ahead and hit that subscribe button and your notification bell so you don't miss out on new content. So when it comes to day trading guys, there are certain rules of the game that we have to follow. We don't make the rules. The rules are made by Wall Street and then we just have to follow them because if we don't follow them, you don't get in the game. And me and you retail investors, we really don't have any power to control those rules. Those rules are set and then we just follow them. So one of the key rules or most important rules in my personal opinion is the PDT rule that a lot of retail investors have to follow. And this comes as a result because as retail investors, we start with small amount of money. Again, like I said, I did a video on talking about your budget, how much money you need to start day trading. So they've set these rules where if you have over $25,000 in your trading account, in a margin account, you can trade as much as you want. You can go in and out of trade like crazy and nothing, no implication. But if you have less than $25,000, they have some regulations there. I don't know how they came to that $25,000 point. I don't know why $25,000, but those are the rules. So we just have to follow those rules. So before we even like jump in and I'll give you guys the ways to get around the PDT rule, I want us to kind of take a look and just understand the definitions and see how this PDT really works. So again, if you go to Investopedia, PDT stands for Pattern Day Trader. And so again, this is somebody that has less than $25,000 in the account and you execute more than three day trade in the five business day cycle. So if you take a look here, read through this. Again, I can put a link in the description so you guys can go out and read this for yourself. I think it's very important to understand and read this. Again, this is for people that have under $25,000 in their margin account. So if you own a margin account or you have a margin account and you have less than $25,000, the rule is you get three day trades in the five business day cycle. So let's jump, I wanna show you guys this in Weibo as well, because that's a platform I use. Again, the definition is pretty much the same. If you have $25,000, you can trade unlimitedly. If you have less than 25, you got three day trade. So three day trade, a complete day trade would be buy security A today and sell it today. Buy security B today and sell it today. And the buy security C today and sell it today. So those are three day trades because I went in and out. There's some other nuances there and I can put that in the description so you guys can understand even better. But once that happened, you have to wait five business days before we can get another three day trades in your account. Then in that case, if you do a day trade when you are under that PDT rule, you get in trouble. They'll risk your account, they can freeze your account for 90 days. So now that's for people that have a margin account. So again, I'm gonna recap here. If you have a margin account and you have under $25,000, you get three day trade and a five business day cycle. Now let's flip over to a catch account, which is the account that is best suited for people that have under $25,000 in my opinion. So if you have under $25,000 in your account, I'll say you should have a cash account. And the reason is because there is a loophole here that means you can actually get around to be able to do unlimited day trade. So with a cash account on the Weibo platform and I'm assuming most of the other platforms as well, you can do unlimited day trade. The only thing here is that you have to use money that is settled in your account. So if you use funds that is not settled, then you can buy. But if you sell before the cash settles, you get in trouble. You get what you call a good faith valuation, G-F-V. So in this case, let's say you buy security A. Today in your account, it would show you in Weibo if your cash is settled or it's not settled. So when you look on your settle cash, it would show you, let's say you have $1,000, settle cash, you go out and buy, let's say security A, and you spend all $1,000 on that security. And then it moves up and you sell it for a profit. You take, now you have, let's say $1,100 in your account. And then you see another security that's moving. You think this thing is gonna keep going up. Then you buy that. At that point, that money is not settled yet. So if you buy it again, you turn it around and sell it, you get a flag. You get the G-F-V flag in your account. You have to wait two days, you get that T plus two. So it takes two business days for that money to settle if you buy and sell that before you can actually use that cash again. So you can use on settle cash to buy, but if you sell before the cash gets settled, you get a flag, you get punished with G-F-V. But the other way to reduce the amount of time that you have to wait for your money to settle is if you do options. Options usually takes one day, whereas if you just do stocks, it takes two business days. So that's something I want you to have at the back of your mind. So guys, again, that was just a simple explanation on how you can go around the PDT rule. Again, if you have a margin account and you have less than $25,000, then you're restricted to three day trade and a five business day cycle. So the best way for you to do is get a cash account so that you can do unlimited trades. And then once you have over 25,000 dollars, you can convey that account to a margin account that will give you unlimited trades. And then I've actually explained how you take your cash account and make it so that you can trade every single day. If you have a thousand dollars, like I said, I want you to do a mental split. So your brain split that money into two $500. So you use the first one today to trade and limit to that $500. And then tomorrow you use the other $500 to trade where you're giving the one that you traded with today time to settle. And then the day after tomorrow, you can have the money that you traded with today settle in your account so you can use that to trade. So that's pretty much the way to get around this whole PDT rule and get around the GFV rule. So that way you don't get flak and you can continue to trade. Again, I don't make these rules. These rules are set out there for us. Two things you have to worry about. GFV, if you have a cash account and PDT, if you have a margin account. So know how to navigate those two to make you consistent with your trading every single day. So let me know again in the comment section if this makes sense. Or do you have issues with this? Have you been flak by Weibo or any of the platforms? I know for sure. Weibo, if you're flak the very first time you can call and talk to them. They're really good at listening and understanding. They would probably get rid of the PDT in your account or the GFV in your account. But if you do it again and then it follows the amount of time you have to wait, which is usually for GFV, if they forgive you the first time and you value it again, what's gonna happen is they're gonna have to freeze your account. You can only use settle cash to trade. You cannot use on settle cash anymore. And then for PDT, if you get a PDT forgiven and then you go out and really break the rules again, you get flak for 90 days, which you don't wanna be in that situation. So definitely be very careful. That's it for this video guys. Again, I'm gonna put the playlist up here for this series so that you can definitely go watch it step by step and follow these along the way. If you're new to the channel guys, we talk about how to earn money, how to save money, how to invest and build wealth. So that's something that interests you. Go ahead and hit that subscribe button and the notification bell so you don't miss out on new content. And also guys, if you're looking to get started with investing, again, my platform of choice is Weibo. They currently have a promotion where if you sign up and deposit $5, you get free stocks at no cost to you. Links in the description below. And as always guys, do your due diligence, don't be a greedy savage, stay motivated.