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IBKR account FAQ says as follows. Would you explain what it means by "4 day trades in a rolling 5 day span"?

"If you open an account with less than USD 25,000, you will be limited to 4 day trades in a rolling 5 day span." (https://www.interactivebrokers.com/en/index.php?f=1560)

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  • You've asked two completely different questions. I suggest you add the removed second one as a new question. – Chris W. Rea Aug 22 '18 at 1:18
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This is part of the Pattern Day Trader rule. However, you are limited to 3 trades (options and equities, not futures) in a rolling 5 day span not 4 trades. If you make 4 trades then you are labeled a pattern Day Trader and must maintain $25k of equity in your account at all times.

3 trades per week would be 3 trades this week and 3 trades next week, etc.

A rolling 5 day span is 5 consecutive trading days. For example, M-T-W-T-F or T-W-T-F-M, etc. As each day drops off of the current 5 day period, so too do those trades made on that departed day, as applied to the total number of trades made.

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  • Would you explain what is possible and what is not possible under this rule? – 180630 Aug 21 '18 at 20:22
  • You must maintain $25k minimum equity on any day trades are made, prior to trading. If account falls below $25k, will not be allowed to day trade until account restored to $25k minimum. Benefit of PDT is being able to intraday trade 4X maintenance margin excess from close of business of the previous day but you must return to 2:1 overnight (50% margin). Brokers have the right to require higher margin levels as well as restrict margin on leveraged ETFs. – Bob Baerker Aug 21 '18 at 23:48
  • If the day-trading buying power limit is exceeded you'll be issued a day-trading margin call with at most, 5 business days to deposit funds to meet the call. Until call is met, day-trading restricted to 2X maintenance margin excess. If not met by the 5th business day, account will be restricted to trading only on a cash available basis for 90 days or until the call is met. – Bob Baerker Aug 21 '18 at 23:48

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