<h4 id="h_01HGW3MJ6QQZX5Q0DVW1B7E322">What is an OTC stock?</h4>
Over-The-Counter (OTC) stocks are securities that aren’t traded on major exchanges like the New York Stock Exchange (NYSE) or Nasdaq. Hundreds of them are available on Stake Wall St. To learn more about OTC stocks, click <a href="https://hellostake.com/blog/stake-academy/stake-academy-otc-stocks">here</a>.  
<h4 id="h_01HGW3MJ6Q0RVQMFCGZAYEGXFB">How much does it cost to invest in OTCs?</h4>
Brokerage and regulatory fees for OTC stocks on Stake are the same as for trading other U.S. securities. Our current brokerage fee is US$3 on any trade up to US$30,000 (or 0.01% above US$30,000).   
<h4 id="h_01HGW3MJ6QW5TD98ZRD8TKQ9MN">Where can I view my OTC portfolio?</h4>
Your OTC stocks will be in your portfolio alongside your other U.S. holdings. They can be identified by the ‘OTC’ symbol on the right side of the screen when the stock is selected. 
<h4 id="h_01HGW3MJ6Q6DNZR1VJGWS4G7N5">Why is there only a LIMIT order available when trading OTC?</h4>
OTC stocks can only be traded using a LIMIT order type (not Market or Stop orders) because you can’t own a fractional amount of an OTC stock. Learn more about the different order types <a href="https://hellostake.com/support/wall-st/articles/35000152385">here</a>. 
<h4 id="h_01HGW3MJ6QTDZXHHAKK1XPMH4J">Things to Consider</h4>
It’s important to recognise that OTC stocks tend to have lower liquidity. Entering and exiting positions may be more difficult if traders are looking for specific prices. Lower liquidity is also associated with increased volatility. If a company does not meet the requirements to list on a normal exchange, its securities can be traded via OTC markets, but may still be subject to some regulation by the SEC (relevant to U.S. securities only). The <a href="https://www.sec.gov/reportspubs/investor-publications/investorpubsmicrocapstock">SEC</a> provides more details of things to be aware of when trading in the over-the-counter markets.

Over the counter (OTC) stocks

<h4 id="h_01HGW32ZQ5MMEW6FWKB80G2BHD">What are circuit breakers &amp; trading halts?</h4>
When markets become extremely volatile, a market-wide circuit breaker can halt trading across all U.S. exchanges and venues. During a trading halt, all buying or selling is temporarily suspended. All orders will be queued to be executed only once the halt is lifted.  These halts are triggered at three circuit breaker thresholds, based on a predefined % increase or decrease against the previous day’s closing price of the S&amp;P 500. The three circuit breaker levels:
<ul>
<li>Level 1: +/- 7% </li>
<li>Level 2: +/- 13% </li>
<li>Level 3: +/- 20% </li>
</ul>
<h4 id="h_01HGW32ZQ5643AR4SCPJ4C45ZY">Times of circuit breakers </h4>
<ul>
<li>A Level 1 and Level 2 breach can be triggered between 9:30am and 3:25pm.</li>
<li>A Level 3 breach can be triggered at any time. </li>
<li>A Level 1 and Level 2 breach halts trading for a minimum of 15 minutes. </li>
<li>A Level 3 breach halts trading for the remainder of the trading day. </li>
</ul>
<h4 id="h_01HGW32ZQ5P38W9NXM3CXWGXB6">Orders during a halt </h4>
You can continue to use Stake and place orders, but these will not be executed until the market re-opens. We cannot guarantee execution in full or in part.    When a halt occurs, all non-executed orders will remain in a pending state until they’re cleared, cancelled or expired. You can cancel these pending orders at any time during the halt.

Circuit breakers & trading halts

<h4 id="h_01HGW3HG6YWCV3HX72FVP13S7H">Trading U.S. ETFs in the UK</h4>
Due to regulations, certain instruments offered by Stake, classified as Packaged Retail and Insurance-based Investment Products (PRIIPS) such as U.S. Exchange-Traded Funds (ETFs) cannot be offered to UK retail clients without the provision of a Key Information Document (KID).  This restriction means that only ‘Professional or Elective Professional Clients’ (i.e non-retail customers) that meet certain criteria can invest in U.S. ETFs. 
<h4 id="h_01HGW3HG6YVS9XDKMGTCR5EM5Y">Information on the procedure for reclassification from retail to ‘Elective Professional’ Client</h4>
Stake is allowed to reclassify a retail client to an elective professional client, once it undertakes an adequate assessment of the expertise, experience and knowledge of the client that gives reasonable assurance, that the client is capable of making their own investment decisions and understand the risks involved. In the course of that assessment, at least two out of the following three criteria must be satisfied:
<ul>
<li>You have carried out transactions, in significant size, on the relevant market (e.g. stocks, ETFs, or similar products in a Stake or another brokerage or share dealing account) at an average frequency of 10 per quarter over the previous four quarters;</li>
<li>The size of your financial instrument portfolio, defined as including cash deposits and financial instruments, exceeds €500,000;</li>
<li>You work or have worked in the financial sector for at least one year in a professional position, which requires knowledge of the products you trade in or want to trade in.</li>
</ul>
Once your request for such reclassification is received by Stake, we will send you some documentation to review, before we can proceed. Documentary evidence must be provided to confirm your responses to the above.  You must read carefully and confirm that you understand all the information and warnings provided by us as in general, elective professional clients are afforded a lower level of investor protection and may be treated differently than retail clients. Detailed information on this will be included in the documentation that will be provided. Additionally, Stake has the right to reject such requests. For further information on the Elective Professional categorisation, please contact our support team <a href="https://hellostake.com/support/contact-us">here</a>.

Elective professional clients and MIFID

<h4 id="h_01HGW3ADTSG2QDYWBR2P7Q23EB">What is day trading?</h4>
A day trade is when an investor buys and sells a financial instrument once or multiple times during a single trading day.   
<h4 id="h_01HGW3ADTS38FZHX8KDST10W7V">What is Pattern Day Trading?</h4>
A day trade is defined as the purchasing and selling or the selling and purchasing of the same security on the same day. Investors will be marked as Pattern Day Traders (PDT) if they execute four "day trades" in a rolling period of five trading days. If you’re marked as a Pattern Day Trader, you may be restricted from making additional "day trades" for 90 days or more. 
<h4 id="h_01HGW3ADTSXEBKVDG564WW953M">Important to Note</h4>
PDT rules come from the U.S. regulatory body FINRA, not from Stake. If you’re designated as a PDT, your ability to place "day trades" will be restricted for the allotted time. This means that if you buy into a security in a given day you are restricted from selling out of the same security on the same day and vice versa. Investors marked as Pattern Day Traders could face further restrictions beyond the initial 90 days, these are at the discretion of FINRA and our U.S. broker-dealer, DriveWealth.
<h4 id="h_01HGW3ADTTCRPBF1Q0TSX988M8">Exemptions from PDT</h4>
Restrictions only apply to PDT account balances under US$25,000.  Your PDT account balance consists of: 
<ul>
<li>Total settled cash; </li>
<li>Unsettled stock sale proceeds</li>
</ul>
For this exemption to apply, your total PDT account balance must be over US$25,000 at the beginning of a given trading day.  Please note that while PDT account balance is calculated using the above metrics, only settled funds/buying power can be used to place a buy order.  
<h4 id="h_01HGW3ADTTNS6KJH4GCRR3842E">What if I’m marked as a Pattern Day Trader? </h4>
If you’re ever marked as a Pattern Day Trader and would like to remove the trading restriction, you can fund your account above US$25,000 for the above exemption to apply. All deposits to your Wall St account (including FastFunds deposits) only count towards your PDT account balance when the cash settles. You will need to maintain this minimum PDT account balance for each trading day you intend on placing buy orders.  
<h4 id="h_01HGW3ADTT5DAK1H9JPZBZ53TY">Stake Day Trade Counter </h4>
To keep our customers on the right side of the rules, we’ve built a Day Trade Counter that allows you to keep track of your day trade count at any time. You can access this on the Stake app by tapping More &gt; Settings &gt; Trade settings &gt; Day trade settings &gt; Day trade protection. On web, head to Menu &gt; Trade settings &gt; Select market 'Wall St' &gt; Day trade settings &gt; Day trade protection. We will also notify you as you place consecutive day trades up to and including your fourth.  You’ll be alerted of the potential impact of placing a fourth day trade, however, you’ll always retain the right to place it if you choose to. If you have any questions about PDT, you can get in touch with the Stake support team <a href="https://hellostake.com/support/contact-us">here</a>.   
<h4 id="h_01HGW3ADTTZESWGM1M8011G9ZD">Day trading examples </h4>
We know day trading can get confusing, so here are some practical examples.   One Day Trade Example 1: Buy, Sell  You start a trading day with 0 shares of AAPL and place the following trades.    Buy 1 AAPL     Sell 1 AAPL  This constitutes a day trade, because you bought then sold AAPL on the same trading day. Day trade = Buy 1 AAPL, Sell 1 AAPL  Example 2: Sell, Buy, Sell  You already own 100 shares of AAPL.    Sell 20 shares AAPL     Buy 10 shares AAPL     Sell 10 shares AAPL This constitutes one day trade. Since you already owned positions, the first sell doesn’t count towards a day trade.     Day trade = Buy 10 AAPL, Sell 10 AAPL  Example 3: Buy, Buy, Buy, Sell, Sell, Sell  You currently hold 0 shares of AAPL.    Buy 5 AAPL    Buy 3 AAPL         Buy 2 AAPL         Sell 1 AAPL        Sell 4  AAPL         Sell 2 AAPL  This is one day trade because there is only one change in direction between buys and sells    Day trade = Buy 5 AAPL, Buy 3 AAPL, Buy 2 AAPL, Sell 1 AAPL, Sell 4 AAPL, Sell 2 AAPL More Than One Day Trade  Example 1: One stock  You currently hold 0 shares of AAPL    Buy 100 AAPL    Sell 20 AAPL         Sell 40 AAPL         Buy 10 AAPL         Sell 10 AAPL  This constitutes two day trades, as there were two changes in direction.     Day trade 1 = Buy 100 AAPL, Sell 20 AAPL     Day trade 2 = Buy 10 AAPL, Sell 10 AAPL  Example 2: Two stocks  You currently hold 0 shares of AAPL or NFLX          Buy 100 AAPL         Buy 20 NFLX         Sell 40 AAPL         Sell 10 AAPL         Sell 10 NFLX       This constitutes two day trades – there were two changes in direction, one per stock.     Day trade 1 = Buy 100 AAPL, Sell 40 AAPL     Day trade 2 = Buy 20 NFLX, Sell 10 NFLX  Example 3: Across multiple trading days  You currently hold 0 shares AAPL or NFLX       Buy 100 AAPL (Monday)         Sell 40 AAPL (Monday)         Sell 10 AAPL (Tuesday)         Buy 20 NFLX (Wednesday)         Sell 10 NFLX (Wednesday)  This constitutes two day trades (one on Monday and one on Wednesday) as a change in direction within the same day occurred twice within a five trading day period.    Day trade 1 (Monday) = Buy 100 AAPL, Sell 40 AAPL     Day trade 2 (Wednesday) = Buy 20 NFLX, Sell 10 NFLX

Pattern day trading (PDT)

<h3 id="h_01HGW3CHTPSKV6DYB6W5JW7DD7">What is a day trade call?</h3>
Even with accounts valued above US$25,000, FINRA’s rules limit the value customers can use to day trade. This limit is called day trading buying power. If a customer exceeds this limit, a day trade call (aka margin call) will be issued.  When you receive a 'day trade call' via email, you will need to deposit the necessary amount to restore your day trade buying power.  This is how this limit is calculated by our U.S. broker-dealer:
Exchange               =    Market value (stocks)   x     25% requirement Exchange               =    Equity (stocks + cash)  -  Exchange requirement margin excess Day trade             =    4     x     Exchange margin excess Buying power  
<h4 id="h_01HGW3CHTQ174AGT3S5KG4NHYB">Day Trade Call Definitions</h4>
Your day-trading buying power is equal to four times the excess of the exchange margin i.e. 4 x the Exchange margin excess: The Exchange requirement is equal to the Market value (stocks) of your portfolio x 25% The Exchange margin excess is calculated by the Equity (value of stocks plus cash in your portfolio) minus the exchange requirement Therefore, Day-trading buying power is equal to four times the Exchange margin excess buying power (4 x exchange margin excess).  
<h4 id="h_01HGW3CHTQH8F1SRZKCTT1JMAE">What happens if you exceed this limit?  </h4>
If this limit is exceeded and a day trade call is issued, Stake will notify the customer that they have up to five business days to deposit funds to meet the call.  Until the call is met, the account will be restricted to a day trading buying power of 2x the exchange margin excess. If the day trade call is not met by the deadline, the account will be further restricted to the exchange margin excess.      If a customer has an unmet call and receives a second day trade call, the account is restricted and they will not be allowed to place any further day trades for the following 90 days or until the calls are met.      This restriction only prevents customers from making day trades (as defined above). Apart from that, the account can still be used for non-day trades.       
<h4 id="h_01HGW3CHTQXSE5RKMTCNN1FFSH">Some things to consider:    </h4>
Day trade calls and Pattern Day Trade restrictions are different, but both are very important for day trading and are imposed by FINRA, not Stake. Those marked as Pattern Day Traders could face more limitations than the 90-day trade restriction, at the discretion of our U.S. broker-dealer, DriveWealth.    Margin requirements are calculated based on the customer’s securities positions at the close of the trading day. A customer who only day trades and does not have a security position at the end of the day still has generated financial risk throughout the day. These rules impose a margin requirement for day trading calculated based on the customer’s largest open position during the day.      DriveWealth is free to impose a higher equity requirement than the minimum specified in the rules. The rules also prohibit the use of cross-guarantees to meet any of the day-trading margin requirements.  For more information, please access the <a href="https://www.finra.org/investors/investing/investment-products/stocks/day-trading">FINRA website</a> or contact us <a href="https://hellostake.com/support/contact-us">here</a>.

Day trade calls

When trading on the U.S. markets, there are regulatory fees involved in selling shares. These are charged independently to your brokerage fees. These additional fees are mandated by governing bodies and are required for trading on U.S. markets.  These sell-side fees are: 
<ul>
<li>An SEC Fee for the U.S. Securities and Exchange Commission to cover costs involved in their regulation of equity dealers and the equities market. This is set at US$8.00 for every US$1,000,000 sold, with a minimum charge of US$0.01.</li>
<li>A Trading Activity Fee (TAF) to support the operations of FINRA (a U.S. regulatory body). This is set at US$0.0000119 per unit sold, with a maximum charge of US$5.95 and a minimum charge of US$0.01. </li>
</ul>
You will see these recorded on trade confirmations, as well as in statements in your Tax &amp; Documents section of Stake.

Regulatory fees

<h4 id="h_01HGW2FR53DGVMF09T8Z1ZBJHQ">Trading the U.S. Markets</h4>
<h4 id="h_01HGW2FR539FNHV7Q34VWQG2NR">Market times </h4>
The U.S. equities market opens at 9:30am and closes at 4:00pm, U.S. Eastern Time (EST/EDST). All times below are in that time zone. You can use a <a href="https://www.timeanddate.com/worldclock/converter.html?iso=20230707T000000&amp;p1=179&amp;p2=136&amp;p3=196&amp;p4=240&amp;p5=152&amp;p6=22&amp;p7=264">Time zone converter</a> to confirm how that translates to your local time at any point of the year, depending on daylight savings.   
<h4 id="h_01HGW2FR53CAGPSRP2BAPP4PTE">Market holidays </h4>
The U.S. market is closed on the following days. You can check the <a href="https://www.nyse.com/markets/hours-calendars">NYSE website</a> for more information.  
 
<div>
<table style="width: 100%;">
<colgroup>
<col>
<col>
<col>
<col>
</colgroup>
<tbody>
<tr>
<td>HOLIDAY</td>
<td>2023</td>
<td>2024</td>
<td>2025</td>
</tr>
<tr>
<td>New Years Day</td>
<td>Monday, January 2 (New Year’s Day holiday observed)</td>
<td>Monday, January 1</td>
<td>Wednesday, January 1</td>
</tr>
<tr>
<td>Martin Luther King, Jr. Day</td>
<td>Monday, January 16</td>
<td>Monday, January 15</td>
<td>Monday, January 20</td>
</tr>
<tr>
<td>Washington’s Birthday</td>
<td>Monday, February 20</td>
<td>Monday, February 19</td>
<td>Monday, February 17</td>
</tr>
<tr>
<td>Good Friday</td>
<td>Friday, April 7</td>
<td>Friday, March 29</td>
<td>Friday, April 18</td>
</tr>
<tr>
<td>Memorial Day</td>
<td>Monday, May 29</td>
<td>Monday, May 27</td>
<td>Monday, May 26</td>
</tr>
<tr>
<td>Juneteenth National Independence Day</td>
<td>Monday, June 19</td>
<td>Wednesday, June 19</td>
<td>Thursday, June 19</td>
</tr>
<tr>
<td>Independence Day</td>
<td>Tuesday, July 4*</td>
<td>Thursday, July 4*</td>
<td>Friday, July 4*</td>
</tr>
<tr>
<td>Labor Day</td>
<td>Monday, September 4</td>
<td>Monday, September 2</td>
<td>Monday, September 1</td>
</tr>
<tr>
<td>Columbus Day</td>
<td>Monday, October 9</td>
<td>Monday, October 14</td>
<td>Monday, October 13</td>
</tr>
<tr>
<td>Thanksgiving Day</td>
<td>Thursday, November 23**</td>
<td>Thursday, November 28**</td>
<td>Thursday, November 27**</td>
</tr>
<tr>
<td>Christmas</td>
<td>Monday, December 25</td>
<td>Wednesday, December 25***</td>
<td>Thursday, December 25***</td>
</tr>
</tbody>
</table>
</div>
* Each market will close early at 1:00pm (1:15pm for eligible options) on Monday, 3 July 2023, Wednesday, 3 July 2024 and Thursday, 3 July 2025. Crossing Session orders will be accepted beginning at 1:00pm for continuous executions until 1:30 pm on these dates, and NYSE American Equities, NYSE Arca Equities, NYSE Chicago and NYSE National late trading sessions will close at 5:00pm. All times are U.S. Eastern Time.
 ** Each market will close early at 1:00pm (1:15pm for eligible options) on Friday, 24 November 2023, Friday, 29 November 2024 and Friday, 28 November 2025 (the day after Thanksgiving). Crossing Session orders will be accepted beginning at 1:00pm for continuous executions until 1:30pm on these dates, and NYSE American Equities, NYSE Arca Equities, NYSE Chicago and NYSE National late trading sessions will close at 5:00pm. All times are U.S. Eastern Time.
 *** Each market will close early at 1:00pm (1:15pm for eligible options) on Tuesday, 24 December 2024 and Wednesday, 24 December 2025. Crossing Session orders will be accepted beginning at 1:00pm for continuous executions until 1:30pm on these dates, and NYSE American Equities, NYSE Arca Equities, NYSE Chicago and NYSE National late trading sessions will close at 5:00pm. All times are U.S. Eastern Time.

How can we help?

Over the counter (OTC) stocks

What is an OTC stock?

How much does it cost to invest in OTCs?

Where can I view my OTC portfolio?

Why is there only a LIMIT order available when trading OTC?

Things to Consider