Has anyone been flagged at one brokerage as professional for violating the 390 rule and been able to open up a new account at a different brokerage with retail status or did the professional "w" status follow you?
The details (TLDR…the opening sentence is the real question).
I violated the rule without knowing it was a thing (flagged on April 2) and my strategy absolutely does not work with the awful professional fills I am getting at Schwab now. I am not looking to close or transfer my Schwab account as I've got a ton of long term hold/dividend stuff there.
I was contemplating just opening a new account somewhere else for at least the next few months until the professional flag comes off at Schwab (presumably at the beginning of Q3) so I can use my strategy to trade (being sure to stay well under 390…probably around the 300-340 range to be safe). I would open it with enough cash to satisfy the PDT requirements.
Has anyone been successful in doing this? If so, with what brokerage? If not, with what brokerage?
I thought the designation follows the beneficial owner (ss number presumably), but I have read enough on Reddit of people who at least imply it can be done, that now I am wondering if this is the case.
Further thinking, could there be any penalty for doing this? I definitely do not plan to exceed retail trading limits and I would not be trying to trade on both accounts so as to circumvent the rule. I would only do standard stock trading and sell an occasional covered call on Schwab (a few trades a day at most). The technique I use that racks up a ton of orders would only be used at the new brokerage and only with retail trading limits (under the 390 average).
Your knowledge and thoughts are greatly appreciated!
390 rule professional designation cross-over
byu/FreeDuty6826 inoptions
Posted by FreeDuty6826
1 Comment
My understanding is that is a temporary status. It lasts one quarter. If you get your order rate down under 390 options orders per day (to me that sounds like a pretty high rate) for a full quarter, you revert. But it’s not a Schwab thing specifically. It’s a CBOE thing. No idea if it would track you across brokers