The PDT rule is gone: what changed for day trading on Interactive Brokers

For years the pattern day trader rule decided how a small account could day trade: three day trades in five business days, then you waited or found $25,000. That rule is now gone, replaced by something that measures how much you borrow during the day instead of how often you trade. This post explains the old rule, the new one with a worked example, what Interactive Brokers says about it today, and what did not change.

Scalpel is independent and not affiliated with or endorsed by Interactive Brokers.

What the old pattern day trader rule was

Under FINRA Rule 4210, a "pattern day trader" was a margin customer who made four or more day trades within five business days. A day trade is buying and selling the same stock in the same session. Once flagged, the account had to keep at least $25,000 of equity to day trade.

IBKR enforced it before you could break it. Its stock margin page still describes the legacy behavior: with under $25,000 in the account, IBKR refused the fourth opening trade within five days and showed a "potential pattern day trader" message, and TWS showed a Day Trades Left count.

The rule never applied to cash accounts. It was a margin rule.

What replaced it: the intraday margin rule

The SEC approved FINRA's amendments to Rule 4210 on April 14, 2026 (Release No. 34-105226, File No. SR-FINRA-2025-017). FINRA then published Regulatory Notice 26-10 on April 20, 2026.

In FINRA's words, the new standards replace "in their entirety" the old day trading margin requirements, "including the day trade count requirements for designating a customer as a 'pattern day trader' and the $25,000 pattern day trader minimum equity requirement." FINRA also says the rule "does not change the regular maintenance margin requirements as they exist today, but rather supplements them."

So the count is gone and the $25,000 is gone. What took their place is a check on how far below your maintenance margin you went during the day.

Intraday margin in plain words

Three new terms do the work. Here they are without the legal wording:

• Intraday margin level (IML). How much cash you could pull out of the account right now and still meet maintenance margin. If you are already short of maintenance, it is the cash you would need to put in, written as a negative number.
• IML-reducing transaction. Anything that lowers that number: a stock purchase, a short sale, or a withdrawal.
• Intraday margin deficit. The most negative IML right after any IML-reducing trade that day. It counts even if you are flat by the close.

Maintenance margin on a long stock is the slice of the position's value you must own outright. FINRA's floor is 25%, and IBKR's stock margin table lists 25% maintenance for a long stock in a margin account. In short: at 25% maintenance, your equity can carry positions worth up to four times it, at any moment of the day. Go past that, even for minutes, and you have created a deficit.

A worked example

A margin account starts the day with $5,000 cash and no positions. Using the 25% maintenance rate and ignoring fees and any house requirements:

The account ends the day flat with $5,000, but it has a $600 intraday margin deficit, because right after the 10:05 buy it needed $600 more equity than it had. Under the old rule this day would have been two day trades out of three allowed. Under the new rule nobody counts the trades; what matters is the 10:05 buy.

The deficit has to be met "as promptly as possible." FINRA's rule counts it as met when, from the end of that day onward, you make net deposits or otherwise raise the account's IML by at least $600. With the account flat, the plain way is a $600 deposit.

What happens if a deficit is not met

FINRA sets the floor. If you make a practice of not meeting deficits promptly and leave one unmet past the close of the fifth business day, the firm must stop you from adding to a debit balance or short position for 90 calendar days, or until the deficit is met. Small deficits, no more than the lesser of 5% of the account's equity or $1,000, do not count toward that practice. A deficit stays outstanding until it is met or until the close of the 15th business day after it occurred.

IBKR's own version, from its stock margin page:

• Deficits "must be satisfied as promptly as possible and ideally within 3 business days."
• Failing to satisfy one "on 4 or more occasions within a 12-month period may result in a 90-day trading restriction across all your associated margin accounts."

FINRA's updated investor page on frequent intraday trading says the same in plainer words: cover a deficit by depositing funds or selling positions, and if you make a practice of not covering deficits, your firm may freeze margin trading for 90 days.

The IBKR PDT rule today

Here is what Interactive Brokers says on its stock margin page, under "Changes to Pattern Day Trading Rules":

• "The $25,000 minimum equity requirement for pattern day traders is being removed."
• "Clients will still be subject to the standard Reg T $2,000 minimum for trades using margin or short sales."
• Trades that reduce your account's excess liquidity "may create an Intraday Margin Deficit ('IMD')."
• "Your account may still be subject to existing PDT rules during FINRA's transition period, which ends in October 2027."

IBKR told Traders Magazine it would implement the change on June 4, 2026 "for eligible securities clients affected by the update." The same IBKR page still carries the legacy PDT text below the update, so read the update box first.

To know where your own account stands, check it rather than a forum thread. If TWS still shows a Day Trades Left count, or an order is refused with a "potential pattern day trader" message, the old rules still apply to you, and IBKR support can tell you when that changes.

Cash vs margin accounts on IBKR

In a cash account you must pay in full before you sell. Settlement for most stocks is T+1, the next business day, so cash from a sale today is spendable tomorrow. FINRA's investor page describes the two classic violations: a good faith violation (buying with unsettled proceeds and selling before they settle) and free riding (buying and selling before paying for the purchase). Neither changed in June 2026.

What did not change

Margin itself. IBKR still lists 25% maintenance and a 50% Reg T end-of-day requirement for a long stock held overnight in a margin account, and 100% in a cash account. Its house requirements can be higher than the rule, especially on small, illiquid stocks.

How IBKR enforces it. IBKR does not make margin calls. Its margin warning entry says real-time liquidations occur when an account has a margin deficiency, and that "generally, accounts will not have time to deposit funds." If you dip below maintenance, IBKR can sell your positions for you without asking.

The $2,000 floor. Margin trading still needs $2,000 of equity at IBKR.

Risk. This is the one that matters. The old rule was a crude brake: three day trades a week was a hard limit on how much a small account could lose to overtrading. That brake is gone. A $3,000 account can now take thirty trades on a Tuesday, and on margin it can carry close to four times its equity while it does. Fast small-cap scalping carries a significant risk of loss, and fewer restrictions make that risk bigger, not smaller.

How to keep your risk fixed now that the count is gone

You need your own brake. Three rules cover most of it:

1. A daily loss limit. Decide the most you will lose in a day, in dollars, and stop when you hit it. A small multiple of your per-trade risk is common: three to five full losers. Set a daily loss limit.
2. Fixed dollar risk per trade. Size every trade from the stop, so each loser costs the same dollars whatever the stock's price. Trade a fixed dollar risk.
3. No borrowing by accident. If your total position value never exceeds your cash, you never use margin, and an intraday margin deficit cannot form. On a small account, set position limits below your cash. Set up for a small account.

Commissions add up faster too when the count is gone: thirty round trips a day on IBKR is a real bill. The math is in IBKR Tiered vs Fixed.

Where Scalpel fits

Scalpel does not apply the PDT rule or the intraday margin rule. Interactive Brokers does. When IBKR refuses an order for buying power, margin or a day trading restriction, Scalpel shows a red toast with IBKR's own reason and code (why an order was rejected).

What Scalpel can do is enforce your own brake, before an order reaches IBKR:

• Daily loss ($) in Settings > Risk trips a RISK LOCK when the day's realized plus open P&L reaches minus that amount. New buys are refused until you click Resume trading, and with Auto-flatten on daily loss ticked it also sells every open position. The day counts from midnight New York time.
• Risk (Cents) buy presets size each entry from your stop, so a $20 button risks $20 on a $2 stock and on a $12 one.
• Fat-finger ($) and Max position ($) caps refuse any single order, or any position in one symbol, above the value you set. Set them under your cash and a single trade cannot borrow.

ACCOUNTSIM

NET LIQ$24,496.80

MARGIN USED$2,280.009.3%

DAILY P&L-$431.20

UNREAL P&L-$72.00

Flatten All Esc

RISK LOCK - Daily loss limit hit (-$503). New entries blocked.Resume trading

Risk locked: Daily loss limit hit (-$503)

None of this is a substitute for knowing IBKR's rules for your account. Where TWS alone is enough, it is enough: IBKR's real-time margin check and its account window already show your buying power. Scalpel adds the limits you choose on top. The wider setup is in day trading on Interactive Brokers.

FINRA, SEC and IBKR sources checked on October 15, 2026.

Trading carries a significant risk of loss. Nothing here is financial advice.

Questions

Does Interactive Brokers still have the PDT rule?

IBKR says the $25,000 pattern day trader minimum is being removed under FINRA's new intraday margin rule, effective June 4, 2026. It also warns that an account may still be subject to the old PDT rules during FINRA's transition period, which ends in October 2027, so check your own account.

Was the pattern day trader rule removed?

Yes. FINRA replaced it with intraday margin standards in Rule 4210, approved by the SEC on April 14, 2026 and effective June 4, 2026. Firms may phase the change in until October 20, 2027.

What is an intraday margin deficit?

It is the largest amount by which your account fell short of maintenance margin right after a purchase, short sale or withdrawal during the day. It counts even if you are flat by the close, and it must be met as promptly as possible, usually by a deposit.

What is the minimum to day trade on IBKR now?

There is no $25,000 day trading minimum under the new rule. IBKR still applies the standard $2,000 minimum for trades that use margin or short sales, and a cash account can day trade with settled cash only.

Does the PDT rule apply to cash accounts?

It never did. A cash account can make as many day trades as its settled cash allows, but it cannot buy with unsettled sale proceeds and sell before they settle without risking a good faith or free riding violation.

Does Scalpel enforce the PDT rule?

No. Interactive Brokers applies its day trading and margin rules to your account. Scalpel shows IBKR's reason when an order is refused and adds your own daily loss limit and position caps.