robinhood-options-mobile

Pattern Day Trader (PDT) Protection & Counter

Overview

Under FINRA Rule 4210, a trader who executes four or more day trades within five business days in a margin account is designated as a Pattern Day Trader (PDT), provided the number of day trades represents more than 6% of the customer’s total trades in that margin account for that period.

When designated as a Pattern Day Trader:

The account must maintain a minimum equity of $25,000 at the close of every business day.
If equity drops below $25,000, day trading is restricted, or the account is limited to closing transactions only for 90 days (unless a broker one-time reset is granted).
Cash accounts are not subject to PDT restrictions, though they must abide by standard cash settlement rules.

The Pattern Day Trader (PDT) Protection & Counter feature provides real-time monitoring of rolling 5-business-day day trades, visual countdown meters, FINRA threshold tracking, and automated risk alerts to safeguard traders from unexpected account restrictions.

Core Architecture & Components

┌─────────────────────────────────────────────────────────────┐
│                      Robinhood API / Brokerage               │
│  • /accounts/{account}/recent_day_trades/                   │
│  • /accounts/ margin_balances (day_trades_protection, dtbp)  │
└──────────────────────────────┬──────────────────────────────┘
                               │
                               ▼
┌─────────────────────────────────────────────────────────────┐
│                     Service Layer                           │
│  • RobinhoodService.getRecentDayTrades()                    │
│  • DemoService.getRecentDayTrades() (Mock for testing/demo) │
│  • IBrokerageService contract                               │
└──────────────────────────────┬──────────────────────────────┘
                               │
                               ▼
┌─────────────────────────────────────────────────────────────┐
│                     Data Models                             │
│  • DayTrade: Equity & Option executions with drop-off dates  │
│  • DayTradeSummary: Rolling count, DTBP, FINRA risk level   │
│  • PdtRiskLevel: safe | warning | danger | flagged | exempt │
│  • Account: Parsed margin balances & protection flags        │
└──────────────────────────────┬──────────────────────────────┘
                               │
              ┌────────────────┴────────────────┐
              ▼                                 ▼
┌───────────────────────────┐     ┌───────────────────────────┐
│  PortfolioAlertService    │     │   DayTradeMonitorWidget   │
│  • Action Center alerts   │     │  • 4-segment visual meter │
│  • Critical: 0 left / PDT │     │  • $25k equity progress   │
│  • Warning: 1 left        │     │  • Filterable trade list  │
│  • Exempt if $25k+ equity │     │  • FINRA Rule 4210 FAQ    │
└───────────────────────────┘     └───────────────────────────┘

Data Models

`DayTrade` (`lib/model/day_trade.dart`)

Represents an individual equity or option day trade:

symbol: Ticker or option contract (e.g. AAPL, TSLA 260327C00220000)
type: 'equity' or 'option'
executionDate: Calendar date of execution
timestamp: Precise execution timestamp
direction: e.g. buy_then_sell
price & quantity: Execution price and share/contract volume
dropOffDate: Automatically computed as 5 business days following execution (skipping weekends and market holidays)
remainingTradingDays: Number of business days before the trade rolls out of the rolling window
isExpired: Whether 5 business days have elapsed

`DayTradeSummary` (`lib/model/day_trade.dart`)

Aggregates rolling day trade activity for an account:

activeDayTradeCount: Sum of non-expired trades in the 5-day window
remainingDayTrades: Number of day trades remaining before hitting the 3-trade ceiling (or -1 if exempt)
isPdtExempt: true if portfolioEquity >= $25,000 or if the account is a cash account
riskLevel:
- safe: 0 or 1 trade used (2 or 3 trades remaining)
- warning: 2 trades used (1 trade remaining)
- danger: 3 trades used (0 trades remaining; next trade triggers PDT designation)
- flagged: 4+ trades used or marked PDT with equity under $25,000
- exempt: Account equity $\ge $25,000$ or cash account
equityDeficitTo25k: Dollar amount required to reach the $25,000 exemption threshold

User Interface: `DayTradeMonitorWidget`

Accessible via User Profile $\rightarrow$ Features $\rightarrow$ Day Trade & PDT Monitor and through the account details chip in User Info:

Header & 4-Segment Visual Counter:
- Visual color-coded gauge representing the 3 allowable day trades and the 4th restriction trigger.
- Dynamic badges displaying risk status (Safe, Warning, PDT Limit Reached, Pattern Day Trader Flagged, PDT Exempt).
FINRA $25,000 Equity Threshold Progress:
- Visual progress bar toward the $25,000 benchmark.
- Live calculation of equity deficit required to unlock unlimited day trades.
Protection & Buying Power Panel:
- Robinhood Day Trade Protection status chip (blocks orders that would trigger PDT).
- Day Trade Buying Power (DTBP) with margin ratio leverage display (e.g., 25% margin / 4x leverage).
- PDT Restriction Expiry date if under a 90-day cooldown.
Recent Day Trades List:
- Filterable by All, Stocks, and Options.
- Per-trade card with symbol, execution timestamp, trade direction, and drop-off countdown (e.g. Rolls off in 2 days • Mon, Oct 19).
FINRA Rule 4210 FAQ & Guidance Accordion:
- In-app explainer covering FINRA requirements, margin rules, and roll-off calculations.

Action Center Integration

PortfolioAlertService evaluates day trade status:

Critical Alert (pdt-limit-reached): Surfaced when 3 of 3 trades have been executed and equity is under $25,000.
Critical Alert (pdt-flagged): Surfaced when the account has been marked as PDT and equity is under $25,000.
Warning Alert (pdt-warning): Surfaced when 2 of 3 trades have been executed (1 trade remaining).
Auto-Suppression: Alerts are automatically suppressed if the account maintains $\ge $25,000$ equity or is a cash account.