How do you guys deal with the PDT rule? Like most algos only runs on 1 symbols and place multiple entries and exit during the day. PDT rule only allowed to place trades 3 times per week. My capital is smaller than 25k, how do you guys run algos on Alpaca when dealing with the PDT rule?
I had the same question in February, which was answered in depth by Dan: Cash account to avoid pattern day trading rule?
My take-away for non-US residents with < 25k capital:
- use the fantastic Alpaca subscription for real-time and historical market data
- use the Alpaca paper account for algorithm development and testing
- use a foreign broker to day-trade CFDs (not available to US-residents) to “indirectly” day-trade US-stocks
- E.g Capital.com offers a good REST-API (comission-free, but beware the spread and the regulatory situation)
- Any broker that offers MetaTrader accounts can be accessed by your own program via an “API-bridge”: https://metaapi.cloud/
- E.g. Admiral Markets offers MetaTrader accounts with low commissions and huge leverage (beware the spread, and the regulatory situation). I can confirm that the integration with MetaApi works (I was not able to successfully connect MetaApi with FlowBank for example)
So in summary, use the combo Alpaca for market data and a CFD broker for placing the trades. Then hopefully switch everything to Alpaca once you reach 25k (much better spreads).
Note: With CFD brokers you do not actually own the stocks (CFDs are just gambling products linked to a real-world product like a stock-price). A CFD broker bets against you and only makes money if you lose money.
US-stock brokers like Robin Hood and Alpaca on the other hand are hopefully on your side, because (if I understand correctly) they make their money not with shady spreads and execution, but from kickbacks when they route your trading volume to their execution providers. And they don’t have to cover your trades in the background by buying/selling the stocks themselves, so Alpaca doesn’t care if the trade goes in your direction.