Can we buy and sell options the same day?

I know the FINRA rules says you cannot day trade more than 4 times in 5 trading days. But what about options, and if it has the same rules, can I pattern trade without margin account?

Public Comments

1. Yes you can do it any time at a single day or next day

2. Yes. Day-traders do it all the time. In fact, that's what you should do if you don't want to have the extra risk of keeping your options over night in case some major news happens. This is best done on volatile stocks that have wildly price swings during the day, and is VERY risky if you don't know what you are doing.

3. Yes you can buy and sell options the same day, HOWEVER, you can be tagged as a pattern trader if you trade the same contract four or more times in five business days, provided the number of day trades are more than six percent of your total trading activity for that same five-day period.

Other words, the pattern trader rules addresses SECURITIES and not just stocks, options are securities so you can be tagged as pattern trader if you trade options.

It is a Federal Rule, that all purchases must be paid in full before they can be sold, if you sell without making payment in full your account can be restricted for 90 days or until payment is made and you can not use the proceeds of the sale to cover the purchase.

However, keep in mind options are not marginable, therefore you will be required to put up 100% of the purchase price, and options carried in your account have no loan value. You still must maintain the account with $25,000 equity.