Using Profits

In general, a customer, who is not in aggregation, and who comes into the day with no overnight positions has a much smaller likelihood of generating a DT call. One way to cause a DT call is to day trade using profits.

Example:

A customer comes into the day with $25,000 of starting day trading buying power and no positions.

Trade 1 (8:45 AM)- BTO 100 ZZZ Feb 450 calls $2.00 ($20,000)
Trade 2 (11:30 AM)- STC 100 ZZZ Feb 450 calls $3.00 (profit of $10,000 – Option BP increases to $35,000)
Trade 3 (1:30 PM)- BTO 200 QQQ March 60 calls $1.50 ($30,000)
Trade 4 (2:45 PM)- STC 200 QQQ March 60 calls $1.50

The customer’s highest open position in requirements is trade 3, when he spends $30,000. This amount, partially made by using intraday profits from his original day trade, exceeds his starting day trading buying power by $5,000, and a DT call will be issued to the customer for this amount.