Robinhood announces major changes in trading rules

Robinhood announces major changes in trading rules Pooja Rajkumari Tue, June 2, 2026 at 5:00 PM GMT+2 2 min read HOOD Stock and crypto trading platform Robinhood Markets (NASDAQ: HOOD) is rolling out a big overhaul of its trading rules starting June 4. On June 1, Robinhood announced changes in line with new Financial Industry Regulatory Authority (FINRA) rules that replace the long-standing Pattern Day Trading (PDT) regime. The changes are expected to give Robinhood's margin account holders significantly more flexibility.

Related: Robinhood exec admits crypto needs better UI: ‘Crypto was made by... ' What's changing on June 4 PDT is a FINRA framework established in 2001 that flags traders executing four or more day trades within five business days in a margin account. Flagged accounts must maintain a $25,000 minimum equity balance, face 4x buying power limits, and risk 90-day cash-only restrictions if day trade calls go unmet.

Introduced after the dot-com bubble to protect retail traders from leveraged losses, PDT has been criticized for blocking smaller traders via its high capital threshold. However, the Securities and Exchange Commission (SEC) and FINRA have now officially eliminated the framework and replaced it with a new Intraday Margin Standard. Brokerages are transitioning to these updated rules as of June 4 this year.

Under the new framework, Robinhood will also eliminate day trade restrictions and day trade calls on margin accounts. Any pattern day trading flags or restrictions previously applied to a user's account will be removed automatically. Users with previously flagged accounts will also become eligible for two programs they were locked out of under PDT, including the High-Yield Cash Program and Stock Lending.

Perhaps the most significant change is the removal of the $25,000 minimum portfolio value requirement to day trade. Going forward, traders will only need to maintain the $2,000 margin minimum equity requirement to access day trading functionality in their margin accounts. More News: 'Rich Dad Poor Dad' issues stark warning on U.

S. Bonds Morgan Stanley sends a message to wealthy clients chasing AI stocks Wall Street veteran issues stark warning on MicroStrategy's business How intraday margin will work In place of PDT, FINRA's new intraday margin standards will require brokerages, including Robinhood, to monitor account equity in real time relative to open market exposure. The goal is to prevent traders from creating or increasing intraday margin deficits during the trading day.

A margin maintenance requirement will set the minimum equity level an account must hold throughout the day relative to its open positions. If equity falls below that level, the account will be flagged with an intraday margin deficit, and the trader will need to top up their portfolio value to restore compliance. Story Continues Repeated breaches could trigger further account restrictions.

Robinhood said the transition is designed to give traders more flexibility while preserving guardrails against excessive risk-taking. Editor's note: This article has been updated to correct the date, which was previously listed as July 4 and has been changed to June 4. Related: Cube CEO says crypto trading should be as easy as Robinhood This story was originally published by TheStreet on Jun 2, 2026, where it first appeared in the MARKETS section.

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