TradeZero PDT Rule (2024)

Does TradeZero have PDT rule? Pattern day trading requirements for accounts below $25,000. How many day trades does TradeZero U.S. and Bahamas allow?

The PDT Rule at TradeZero

If you want to day trade securities, TradeZero has some good tools for you. TradeZero is one of the few brokers in the industry to have both American and foreign branches, and this situation gives day traders two choices.

TradeZero Bahamas PDT Rule

TradeZero has a branch located in Nassau, Bahamas (the virtual address is www.tradezero.co). Because this brokerage firm is headquartered in the Caribbean, it is not regulated by FINRA, the major securities watchdog in the United States. Thus, there is no pattern day-trading (PDT) rule governing accounts with this brokerage firm. You can day trade all you want with a Bahamian TradeZero account without worrying about the PDT rule.

TradeZero Bahamas does have its own rule for accounts that plan to day trade. It is $1,000 in account equity.

Downsides of Offshore Accounts

If you do choose to open a TradeZero account with the Caribbean branch, you need to be aware that FINRA and the SEC only regulate brokerage accounts located in the United States. Moreover, there is no SIPC insurance on these accounts.

TradeZero does have insurance (up to $250,000 per customer) through Argenta Group. The broker-dealer is regulated by the Securities Commission of The Bahamas.

U.S. Broker For non-U.S. Traders

For non-U.S. traders, a good alternative broker is a United States based company called . .

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TradeZero U.S. PDT Rule

If you want to avoid the pitfalls of offshore brokers, you can open a securities account with the American branch of TradeZero (the URL’s ending is slightly different: www.tradezero.us). This broker is headquartered in New York, which means it is regulated by FINRA and the SEC. Accounts are also insured by SIPC.

The downside of opening an account with TradeZero US is of course the PDT rule. This regulation says that any account classified as a pattern day-trading account must have at least $25,000 in account equity. This obviously is 25 times as much as TradeZero Bahamas requires, which is a very steep increase.

Nevertheless, there are ways around this requirement. Essentially, what you need to do is to avoid having your account flagged as a PDT account. To accomplish this, you need to make sure that:

1. You have fewer than 4 round-trip day trades of securities in a rolling 5-market-day period; or

2. Your account is a cash account and not a margin account; or

3. Your total day trading activity makes up less than 6% of your account’s overall trading activity.

You only have to meet one of these goals. If you do, then you don’t have to worry about the $25k rule.

does tradezero have pdt rule

Available Day-Trading Platforms at TradeZero

Both branches of TradeZero have the same software. All platforms (including the mobile app) have a short locate widget. The most sophisticated trading system is ZeroPro, the company’s desktop platform. It does have a monthly fee, however. Caribbean customers who meet volume requirements get the software at no cost.

Better Broker For U.S. Traders

For active traders in U.S., a good alternative to TradeZero is . It has a number of advantages over TradeZero: virtual trading, better app, and lower pricing. .

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