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How did speculative investing weaken the stability of the stock market?

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User IntoVoid
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Prior to new regulations about margin in the early 2000's, day traders were able to leverage their accounts and continuously buy and sell positions all day long. A small day trader could be trading millions of dollars in stocks each day, destabilizing the market.
The "day trading rule" was invented to ensure that a trader could do no more than 4x their account value and keep a minimum. Of $25k in their account at all a times.
User Rick T
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