On April 20, FINRA adopted new intraday margin standards, replacing the previous day trading margin requirements under Rule 4210 and eliminating the “pattern day trader” designation, along with its $25,000 minimum equity requirement. The change, which will be effective June 4 with a phase-in period through October 20, 2027, will grant greater customer trading flexibility while requiring margin accounts to maintain equity appropriate to their market exposure at any point during the trading day. The new rule introduces the concept of an “intraday margin deficit,” which members must calculate for each customer margin account (other than good faith or portfolio margin accounts) whenever certain transactions reduce the amount a customer could withdraw without breaching maintenance margin requirements. Members may use more current market values for these calculations and treat Sweep Program balances as credit.

The amendments do not alter existing maintenance margin requirements but add real-time or single-calculation intraday margin monitoring and set clear procedures for handling intraday margin deficits. Deficits must be satisfied as promptly as possible and remain outstanding until satisfied or until 15 business days after the deficit date. If a customer “makes a practice” of failing to satisfy deficits as promptly as possible and fails to satisfy a deficit by the close of business on the fifth business day, the rule requires a 90-day freeze on certain account activities, subject to exceptions for deficits not exceeding the lesser of 5 percent of account equity or $1,000, or deficits occurring under extraordinary circumstances. Portfolio margin accounts with less than $5 million in equity are now subject to parallel intraday margin risk controls. FINRA stated it plans to issue additional interpretive guidance separately.