|December 10, 1999
Rich C. Adamonis/NYSE
Nancy A. Condon/NASD Regulation
NYSE and NASD Propose Higher Level of Margin Requirements for Day Trading
New York, Dec. 10—The National Association of Securities Dealers, Inc. Board of Governors and the New York Stock Exchange Board of Directors have approved proposals to establish special margin requirements for customers who day trade in an effort to address the risks associated with the practice.
The proposals, to be submitted to the Securities and Exchange Commission for approval, would amend NYSE Rule 431 and NASD Rule 2520, which govern margin requirements.
Under the proposed rules, customers who engage in a pattern of day trading would be subject to minimum equity requirements. The amendments would also limit a day trader’s buying power to an amount based on funds that must be in the account prior to any day trading activities.
The proposals would also: