Day trading buying power is the amount of trading exposure your account can support under the margin or cash rules applied by your broker. As of September 20, 2026, the calculation depends on whether the firm still uses legacy pattern day trader rules or has moved to FINRA's intraday margin rules.
- Legacy pattern day trader rules: Day trading buying power equals four times the maintenance margin excess from the previous business day's close.
- FINRA's intraday margin rules: There is no universal four-times formula. Your broker calculates supported exposure using current equity, open positions, maintenance requirements and house rules.
- Cash accounts: Trading capacity is generally limited to settled cash.
FINRA's new intraday margin requirements took effect on June 4, 2026. Brokerage firms can transition from the old system through October 20, 2027, so the calculation that applies to your account depends on your broker.
Day Trading Buying Power Calculation at a Glance
| Account framework | How buying power is calculated | Important limitation |
|---|---|---|
| Legacy pattern day trader framework | 4 × maintenance margin excess |
Uses the previous business day's closing account values |
| New intraday margin framework | Current equity must support the exposure and applicable margin requirements | No fixed four-times multiplier |
| Cash account | Settled cash available for trading | No margin loan or margin-based buying power |
How Does the Legacy Day Trading Buying Power Formula Work?
Under the legacy FINRA rules, day trading buying power equals four times your maintenance margin excess at the previous business day's close.
Maintenance margin excess
= Account equity − maintenance margin requirement
Day trading buying power
= Maintenance margin excess × 4
FINRA defines day trading buying power for equity securities as the customer's equity at the previous business day's close, minus the applicable maintenance margin requirement, multiplied by four.
Example
Assume your account has:
- Account equity: $40,000
- Maintenance margin requirement: $10,000
$40,000 − $10,000 = $30,000 maintenance margin excess
$30,000 × 4 = $120,000 day trading buying power
The resulting buying power is $120,000, before any broker-specific restrictions.
The calculation uses the account's prior-day closing condition. Intraday losses, higher requirements for particular securities and broker limits can reduce the amount available for new trades.
What Is Maintenance Margin Excess?
Maintenance margin excess is the amount by which your account equity exceeds the maintenance margin required for your existing positions.
Account equity: $40,000
Required maintenance margin: $10,000
Maintenance margin excess: $30,000
The calculation is not simply:
Account equity − $25,000
The former $25,000 pattern day trader minimum was a separate account requirement. It was not automatically the maintenance margin requirement used in every buying power calculation.
Your maintenance requirement can depend on:
- The market value of your positions
- Whether the securities are margin eligible
- Whether you hold long or short positions
- Options and other non-equity securities
- Higher house requirements set by your broker
- Existing debit balances and account losses
FINRA's standard maintenance margin for many long, margin-eligible equity positions is 25%, but a brokerage firm can require more.
What Changed Under FINRA's New Intraday Margin Rules?
FINRA's new intraday margin rules replace the traditional pattern day trader framework with intraday margin monitoring. They remove:
- The pattern day trader designation based on the number of day trades
- The specific $25,000 minimum equity requirement for pattern day traders
- The fixed day trading buying power formula
Under the new system, the brokerage firm checks whether your account has enough equity to support its intraday positions. The firm can monitor this in real time, prevent trades that would create a deficit, calculate the deficit at the end of the day or use more than one method.
FINRA requires at least 25% equity relative to the current market value of long, margin-eligible equity securities. A broker can set a higher requirement. The requirement applies during the trading day instead of only at the close.
Simple New-Rule Example
Suppose you have:
- Account equity: $10,000
- No existing positions
- A 25% maintenance requirement
- No additional house restrictions
$10,000 ÷ 25% = $40,000
Under that calculation, the account could support about $40,000 of long stock exposure. This is a theoretical limit, not a guaranteed buying power quote. Short positions, options, volatile securities, existing loans, price changes and broker requirements can reduce the amount available.
The new system is based on the exposure your current equity can support, rather than a universal day trading multiplier.
Does the $25,000 Day Trading Rule Still Apply?
The $25,000 pattern day trader requirement does not apply universally under FINRA's new intraday margin framework. During the transition period, some firms may continue operating customer accounts under the legacy rules. Check which system your broker uses.
The ordinary minimum equity requirement for leveraged margin trading remains generally $2,000, although a brokerage firm can require more. An account below that amount may still be able to trade with cash and without leverage, depending on the broker's policies.
How Is Buying Power Calculated in a Cash Account?
In a cash account, buying power is generally based on settled cash rather than margin capacity.
For most U.S. stock and ETF transactions, settlement is generally T+1, meaning one business day after the trade. Selling a security before paying for it with settled funds can create a freeriding violation and account restrictions.
Cash-account buying power differs from margin-account buying power in several ways:
- You do not borrow from the broker.
- You do not receive the old four-times day trading multiplier.
- You must track settled and unsettled cash.
- Broker-specific cash trading restrictions can apply.
What Happens If You Exceed Your Available Buying Power?
Under the legacy framework, exceeding day trading buying power can create a day trading margin call. The account may then be limited to lower buying power. Failure to meet the call can lead to cash-only trading restrictions for up to 90 days.
Under the new framework, an account below its required intraday margin level has an intraday margin deficit. The broker may require a deposit of cash or securities, liquidate positions or prevent you from opening new trades. Repeated failure to satisfy deficits promptly can lead to a trading restriction of up to 90 days.
How Do You Find the Buying Power That Applies to Your Account?
Start by identifying your account type and the margin system used by your broker.
- Legacy margin account: Apply the prior-day maintenance margin excess formula and multiply the result by four.
- Intraday margin account: Use the exposure supported by your current equity, open positions, applicable margin requirements and house rules.
- Cash account: Use the settled cash available for trading.
The buying power displayed in your broker's platform controls order entry. Because firms can impose higher requirements and are moving to the 2026 rules at different times, confirm whether your account uses legacy day trading buying power or FINRA's intraday margin system.