What is a day trade and why is it risky?

A day trade is when you buy and sell or sell and buy the same financial instrument, like a stock or ETF, within a single trading day. It can be risky because market conditions can change quickly, and short-term price fluctuations are hard to predict.

Pattern day trading restrictions are in place to limit the number of day trades within a certain period. Our 3rd party broker enforces these restrictions to reduce the risks associated with frequent day trading. When you open your account, you agree not to engage in pattern day trading. Please refer to “Why can I not execute more than three day trades in up to five business days?” for more context on Pattern Day Trading.

Please note that breaking this agreement may result in penalties or restrictions on your trading activities. Always ensure you understand the rules and risks before attempting to day trade.