What Is Buying Power and How Does It Work at GigaTrade?
Learn how buying power is calculated, how the Intraday Margin Limit (IML) framework replaced PDT rules, and what changes for your trading account.
What Is Buying Power?
Buying power is the amount of capital available in your account to purchase securities.
- Cash account: Buying power equals your settled cash balance, minus any pending or unsettled trades.
- Margin account: Buying power is enhanced through borrowed funds. Under Regulation T, margin accounts receive up to 2:1 overnight leverage based on account equity.
Under the new Intraday Margin Limit (IML) framework, all eligible margin accounts may access up to 4:1 intraday leverage for equities trading — regardless of account size. The previous Pattern Day Trader (PDT) designation and $25,000 minimum equity requirement have been eliminated.
Buying power can change throughout the trading day based on:
- Market movements
- Open positions
- Margin utilization
- Equity fluctuations
- Security-specific margin requirements
How Is Buying Power Calculated?
Buying power is calculated using:
- Current account equity
- Open positions and exposure
- Initial and maintenance margin requirements
- Intraday Margin Limit (IML) availability
Intraday and overnight buying power may differ. Values update in real time as market conditions and account balances change.
What Is the Intraday Margin Limit (IML)?
The IML replaces the former PDT framework for active equity trading.
Under IML:
- Eligible margin accounts may access up to 4:1 intraday leverage for stock trading
- No $25,000 minimum equity requirement
- Positions held overnight remain subject to standard 2:1 Regulation T margin requirements
- Margin availability is based on account equity, risk exposure, and firm-specific requirements
IML applies to stocks and equity options (where applicable). Futures are subject to separate exchange and margin requirements.
Key Benefits of the New IML Framework
The new framework provides greater flexibility for active traders:
|
Benefit |
Detail |
|
Intraday leverage |
Up to 4:1 in eligible margin accounts |
|
No PDT designation |
No day trade counting or restrictions |
|
No minimum equity |
No $25,000 requirement for active trading |
|
Unlimited intraday trades |
Subject to risk and margin availability |
|
Overnight leverage |
Standard 2:1 under Regulation T |
Risk Disclosure: Trading on margin involves substantial risk and may not be suitable for all investors. GigaTrade may impose additional house requirements or risk controls at any time.