Day trading is one of the most efficient and exciting sectors of trading. It is widely performed by professional traders using different platforms.
Out of several platforms available for day trading, Robinhood stands at the top for trading. A trader is categorized as a day trader when they trade more than four times in the period of weekdays i.e. in five days.
How Many Day Trades Can You Make On Robinhood?
Once you fix that you wish to do day trading or wish to change your day trading platform to Robinhood, the obvious question of how many day trades can you make on Robinhood arises.
The simplified answer to this is You can make a maximum of three trades in five days on Robinhood. However, the case is different if you have a larger scale portfolio
Robinhood allows you to make the fourth trade on consecutive days only if you have 25,000 dollars in your portfolio or the equivalent value of assets in your possession.
This valuation involves the cash value and the stocks present in your account computed together.
Can You Day Trade On Robinhood?
Yes, You can day trade on Robinhood. If you’re a day trader and wondering if you can use your favorite trading app, Robinhood for day trading as well, yes you can. Robinhood allows you to day trade for three days followed by another additional day for trading based on your portfolio.
There are certain rules through which you can day trade on Robinhood. These rules include the present value of around 25 thousand in your Robinhood account.
However, if you are not able to keep up with these rules and how to calculate appropriate valuation, Robinhood helps you.
You can check on the day trade bar under the day trade column in the side menu of your app. You can check if you are eligible for day trading on Robinhood by checking your status under this section.
Also Read: Why Robinhood is Bad?
How To Get Unlimited Day Trades On Robinhood?
For the day traders, there is always hope for an extra day of day trading via Robinhood. And when day traders are limited to making three trades in five days by Robinhood, they find ways of how to get unlimited day traders on Robinhood.
The day traders must pay attention to the type of account they are using for day trading. The limitations are limited to the two basic kinds of accounts on Robinhood i.e. instant and gold, also called the marginal accounts.
However, if you have a cash account and use it for day trading, you can get rid of these limitations. All you need is 25 thousand worth of assets including cash and stocks to use your cash account for day trading. However, you will require a minimum of two days for the market and stocks to settle.
Therefore, if you want to do more than 3 trades in five days, you can day trade from your cash account. However, it is better to use marginal accounts and keep the assets aside.
Is Robinhood Good For Day Trading?
Yes, absolutely Robinhood is good for day trading. With over 22 million account holders, Robinhood has achieved a remarkable position in the top apps for trading by all kinds of investors.
However, as per the experts of the market, Robinhood is best suitable for marginal traders, day traders, and smart investors.
Although there are certain rules for day trading on Robinhood, its user-friendly application and interface attract day traders.
Not only the professional day traders but also the beginners in day traders can seek help from Robinhood for day trading.
It allows you to begin day trading without any external or additional cost. However, if you wish to step up your day trading game, you might want to switch to your cash accounts.
Robinhood allows beginners to adapt to the new world of day trading using their easy-to-use applications and guidelines.
Therefore, if you are still wondering if Robinhood is good for day trading, you can try from the initial trading options on the app. Once you get to trust the app and platform, you can increase your traders at your convenience.
Also Read: How to Activate Robinhood Debit Card?
Why Can’t You Day Trade On Robinhood?
Robinhood allows all kinds of traders to put in the day trades using the day trading feature of Robinhood. However, if you are unable to do so, you must have missed out on a few details while day trading earlier.
The very first detail to keep in mind is if you have a gold or marginal account at Robinhood you are only allowed to do day trading for three days in a given day cycle.
Also, this cycle may not be synchronized with the actual or general week cycle. Say, your day trading week cycle can start from Tuesday and last up to 5 days. It may or may not coincide with the weekly Monday to Friday cycle.
However, if you put a fourth-day trade using your marginal account on Robinhood, it closes your trades for another 90-day pattern. Do not worry, you can resume your day trading like usual once this 90-day pattern is over.
Can You Get Banned For Day Trading On Robinhood?
It depends. Robinhood doesn’t ban their beloved account holders. However, they can put a pause on your day trading activities for a fixed period.
This happens in the case where you put a fourth-day trade with your account except your cash account. If your account doesn’t value or gather equity of 25 thousand dollars, you can not put the fourth trade.
If you were unaware of this before and failed to stick to these rules set by the Robinhood app, they may restrict you. However, this is not a permanent or a literal ban. It is simply a restriction for a 90-day cycle from the fourth-day trade.
As soon as your 90-day cycle ends, your prohibition is lifted and you can resume your day trading like usual. It is therefore advised to go through the set of rules set by the Robinhood app to avoid such situations.
Also Read: Why Does Robinhood Need My SSN?
What Happens If You Make Too Many Day Trades On Robinhood?
This is a diced condition. It depends entirely on what kind of account you are using for day trading on Robinhood. If you are using your cash account, you can make as many day trades as you wish with your account. There are no restrictions or limits on the cash account of Robinhood users.
If you are using your gold or instant account for day trading with a combined equity of 25 thousand, even then you’re safe and there are no “too many” day trades.
You can make day trades even on the fourth day of the five-day window of day trading. However, if this is not the case, you can get a temporary restriction from any sort of day trading by the Robinhood app itself.
However, it will be lifted after 90 days from the last day trade of your account. You are then free to perform a maximum of three day trades in a five-day cycle.
Can You Buy And Sell The Same Stock Repeatedly On Robinhood?
Yes, you can buy and sell the same stock repeatedly on the same day on Robinhood. When you buy a stock and observe a hike in price on the same day you wish to sell it. However, this situation can be changed as per the market.
If you buy and sell a certain stock on the same day, it will be accounted for under a day trade. This can be done only three times in five days as per the Robinhood rules.
Although, if you buy a stock and sell it the next or consecutive day, it will be counted as a swing trade.
As soon as you are doing swing trade, you can do it as many times as you wish. But if you want to do this as a day trade, you must have more than 25 thousand worth of assets in your account.
Also Read: What Happens if Robinhood Shuts Down?
Day Trading Rules Over 25k
The day trading rules over 25k are simple. As long as the account holder can put up combined equity of 25k and above accounting for cash and stocks only, they can day trade as many times as they wish.
There are no restrictions for such accounts with more than 25k in their account. The account holders must keep in mind that equity involves only the cash amount and the stocks present with the account holder.
Can You Day Trade Crypto On Robinhood?
For all the traders, this is one of the most concerning topics. Yes, you can day trade crypto using the Robinhood app.
This platform allows you to day trade and swing trade crypto easily. The procedure of trading crypto on Robinhood is similar to that of trading stocks and EFTs.
However, you can get mistaken that Robinhood is only for stocks. But, with over thousands of happy users, Robinhood proves to be an equally efficient platform for crypto trading as well.
What Counts As A Day Trade?
The trading in which an individual buys and sells certain stocks, crypto, or EFTs on the same day. It can be done during the working hours of the international market. There can be multiple trades of a single or different stock using their account in a single day.
There are mostly three trades allowed in a five-day window. These five days can account for different working days in a market and may vary up to the trader.
Only and only the trades bought and sold on the same day are counted as a day trade.
Day trading is an effective and efficient technique of trading. It is suitable for smart investors. Using Robinhood makes your day trading experience easier and hassle-free.
All you need is to read and understand a set of instructions set prior by the Robinhood app for easy and fair day trading.