margin interest的问题 (ZZ)

oldfairy

conversation between 168 tamag and D56

Q:
I know if I have enough fund to cover a long position, I'm not charged any margin interest.  What if it's a short position?  I have enough fund to cover a short position.  Am I still charged the interest?  Thanks.

A:

Yes, you will be charged. For example, you have 1M account. You only shorted 1000 share of WFC at 20. You margin requirement is 1000*20/2=10000 (we assume 50%). Then your interest will be:

Your cash: 1M+1000*20=1020000. Broker will pay you interest based on 1020000.
Your margin: 10K. Broker will charge your interest based on 10k.

Mostly the interest you get will be 0.5%, the interest you get charged is 5-10%.