1 year ago
116 Interactive Brokers has announced that clients are expected to earn up to USD 4.33% on instantly available cash balances over USD 10,000.
The broker makes a difference by paying interest directly to client brokerage accounts, thus eliminating the need for separate sweeps accounts, funds or programs and enables cash to be instantly available.
IBKR seems to offer an unmatched market interest, which goes as high as USD 4.33%, unlike alternative brokers that offer USD 0.01% (E-Trade), USD 0.35% (TD Ameritrade), USD 0.45% (Schwab), and USD 2.32% (Fidelity).
The broker calculates market interest using the Fed Funds rate as the reference rate for USD minus 0.5%. As a result, if interest rates continue to rise as expected, clients of Interactive Brokers will have the opportunity to earn more.
How to earn more in their brokerage and savings accounts
Thomas Peterffy, Founder and Chairman of Interactive Brokers, said: “In the current rising rate environment, many investors are considering how to earn more in their brokerage and savings accounts. Investors who allocate a portion of their portfolio to cash may benefit from Interactive Brokers’ competitive interest rates, powerful trading platforms, and a broad range of low-cost and global products.”
For clients of Interactive Brokers, interest accrues daily, and payments are posted on a monthly basis. Interactive Brokers’ cash management is integrated into client broker accounts, making it simple to earn interest and borrow at the lowest rates without transferring cash.
Accounts with a Net Asset Value (NAV) of USD 100,000 (or equivalent) or more are paid interest at the full rate for which they are eligible. Accounts with NAV of less than USD 100,000 (or equivalent) receive interest at rates proportional to the size of the account.
There will be no interest paid on the first USD 10,000 of cash. Interest is earned on long-settled cash balances held in the securities segment of an account but not on cash held in the commodities segment.
IBKR provides automated trade execution and custody of securities, commodities, and foreign exchange around the clock on over 150 markets in numerous countries and currencies, from a single unified platform to clients worldwide.
The firm caters to individual investors, hedge funds, proprietary trading groups, financial advisors, and introducing brokers.
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