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Active Trading
Lowest Margin Rates and Portfolio Margin Brokers
On a $25K balance, the lowest published margin rates are Webull Premium (5.20%, with a $3.99/month subscription), Robinhood (5.25%) and Interactive Brokers Pro (5.38%). Schwab, Fidelity and E*TRADE charge 11.5–12.2%, which costs up to about $1,750 more a year. Portfolio margin at Schwab, tastytrade and E*TRADE starts at $100K–$125K. Rates checked September 25, 2026.
Which Broker Fits How You Use Margin
The cheapest margin depends on how much you borrow, whether you short, and how much liquidation risk you can live with. These picks use the official rates in the table above, checked September 25, 2026.
Low rates at every balance
Interactive Brokers
IBKR Pro charges 5.38% up to $100K, 4.88% to $1M and 4.63% above, blended across tiers, with no subscription.
Interactive Brokers review →
Small balances
Robinhood
5.25% on balances up to $50K, with or without Gold. Gold ($5/month) also makes the first $1,000 of margin interest-free.
See in comparison table ↑
Lowest rate with a subscription
Webull Premium
5.20% at $25K down to 4.40% at $1M for $3.99/month. Without Premium, Webull charges a flat 8.74%.
Webull review →
One flat rate
Moomoo
6.8% at every balance, with no tiers or subscription. It's simple, but there's no discount as you borrow more.
Moomoo review →
Portfolio margin for options traders
tastytrade
Portfolio margin from $125K to open ($100K to maintain). Standard rates are higher: 11.00% under $25K, down to 8.00% at $1M+.
tastytrade review →
Active short sellers
TradeZero
A flat 9% margin rate with a short-locate service and zero stock commissions, which cuts the cost of frequent trading.
TradeZero review →What Borrowing Actually Costs at Each Rate
One year of interest on a steady $25K or $100K debit balance, at each broker’s published rate for that balance. The three lowest are highlighted.
| Broker | Rateat $25K | Intereston $25K | Rateat $100K | Intereston $100K |
|---|---|---|---|---|
| Webull Premium ($3.99/mo) | 5.20% | $1,300 | 5.00% | $5,000 |
| Robinhood | 5.25% | $1,313 | ~4.75–5.05% | ~$4,750–$5,050 |
| Interactive Brokers (Pro) | 5.38% | $1,345 | 5.38% | $5,380 |
| Moomoo | 6.80% | $1,700 | 6.80% | $6,800 |
| Webull (standard) | 8.74% | $2,185 | 8.74% | $8,740 |
| TradeZero | 9.00% | $2,250 | 9.00% | $9,000 |
| tastytrade | 10.50% | $2,625 | 9.50% | $9,500 |
| Charles Schwab / Fidelity | 11.575% | $2,894 | 10.575% | $10,575 |
| TradeStation | 11.75% | $2,938 | 10.75% | $10,750 |
| E*TRADE | 12.20% | $3,050 | 11.20% | $11,200 |
Borrowing at the cheapest broker rather than the most expensive saves about $1,750 a year on $25K and over $6,000 on $100K. The figures are simple interest; most brokers accrue daily on a 360-day year, so a full calendar year costs slightly more. Webull Premium also costs $47.88 a year. Robinhood shows a range because its published tiers are ambiguous at exactly $100K. Rates were checked on each broker’s site on September 25, 2026 and move with benchmark rates.
Estimate your margin interest
| Rate | Effective rate | Interest for period | Per year |
|---|
How to compare margin rates properly
- Use your real tier. Headline rates often need very large balances. IBKR's lowest tier, 4.63%, applies only above $1M. Find the rate for the balance you actually carry.
- Blended vs. whole-balance tiers. Some brokers charge each slice of the balance at its own tier rate, and others apply one rate to the whole balance. On the same schedule, the two can produce very different bills.
- Interest applies to your net debit only. With $100,000 in securities and a $40,000 cash debit, you pay interest on the $40,000.
- Benchmark pass-through. Some brokers tie rates to benchmarks and change them within days of a Fed move. Others adjust administratively and less often. Test your cost at +1% and −1% if you hold for months.
- Leverage sets your hurdle rate. An 8% rate on a position that's half borrowed means the whole position must return 4% a year just to cover interest.
The Four Parts of Your Margin Cost
~4% – 12.7%
Posted rate and tier
The annual rate on your debit balance. It usually falls as the balance rises, but most retail accounts never reach the lowest tiers.
Benchmark + spread
How the rate is set
Most rates are a benchmark (such as the Fed funds rate or SOFR) plus the broker's spread. The spread is where brokers differ most.
0% – 50%+
Short borrow fees
Charged separately on hard-to-borrow stocks as an annual rate on the short position. On crowded shorts, it can dwarf the margin rate.
25% – 100%
Maintenance requirements
FINRA sets a 25% minimum. Brokers' house requirements are often 30–40%, and higher for leveraged ETFs, low-priced stocks and concentrated positions.
Costs the Headline Rate Doesn't Show
- Hard-to-borrow fees. A short on a stock with a 60% annual borrow fee has to fall more than 60% over a full year just to break even. Check the rate before entering, not on your statement.
- Locate minimums. Some brokers charge a flat minimum per locate. On 100–300 share shorts, that can make small trades uneconomical.
- Borrow rate resets and recalls. Some brokers update borrow rates daily while others lock them at locate. Lenders can also recall shares, which forces a close, most often around corporate actions.
- Automatic liquidation. Some brokers, including Interactive Brokers, liquidate in real time without a margin call, choosing which positions to close. Others issue a call and give you time to deposit funds.
- Concentration rules. A single stock making up half your account can carry a 50–100% maintenance requirement, which removes most of its margin.
- Rate changes. Rates track benchmarks, so your cost can rise mid-hold. Re-check after every Fed decision.
How To Lower What You Pay on Margin
The rate is only part of it. Tier, account type and how you borrow all change the bill.
- Find the rate for your actual balance. Get the full tier schedule and use the rate for your typical debit, not the lowest advertised one.
- Model your real use. Estimate interest for your typical overnight balance, a two-week fully margined stretch and any short positions, as in the calculator above.
- Ask for a lower rate. Schwab and E*TRADE don’t publish rates above $500K and ask you to call instead. That’s where larger clients negotiate.
- Check portfolio margin. It bases requirements on overall portfolio risk, which helps hedged positions. Schwab and tastytrade require $125K to open, and E*TRADE requires $100K plus Level 4 options approval.
- Separate long interest from short borrow fees. They're charged differently. Compare both on your own watchlist before moving a short-heavy strategy.
- Know the liquidation policy first. Read how the broker handles margin calls and which positions it closes first. For volatile positions, this can matter more than a 1–2% rate difference.
How We Compared
Rates come from each broker’s official margin rate page, checked September 25, 2026 and summarized in the comparison table. Cost examples are simple interest on a constant balance and exclude short borrow fees and subscription costs. Brokers marked “Special Offer” are AInvest partners, and AInvest may be compensated when you open an account through this page. Margin rates change with benchmark rates, so confirm current pricing with the broker before borrowing. Borrowing on margin can magnify losses beyond your initial investment.
FAQ & Glossary
Is the lowest margin rate always best?
No. Execution quality, borrow access, and liquidation policy can outweigh a modest rate advantage. Calculate total cost, not rate alone.
How often should I review margin costs?
Monthly. Rates change with market conditions, and your utilization patterns might shift strategy to strategy.
What is Margin?
Borrowed money from your broker used to purchase securities. You pay interest (margin rate) on the borrowed amount.
What is Margin Call?
A broker's demand that you deposit cash or securities because your account equity has fallen below the maintenance requirement.
What is Maintenance Requirement?
The minimum equity percentage (usually 25–30%) you must maintain. If you fall below it, your broker can force liquidation.
What is Locate Fee?
A fee charged when you short a stock that's hard to borrow. Quoted separately from margin rate and can vary by stock and volume.
What is Portfolio Margin?
An advanced margin treatment available to qualified traders that uses portfolio-level risk models instead of individual position limits.
What is Borrow?
Securities lent to you by the broker so you can short them. Borrow availability and cost vary by stock and market conditions.
What is a good margin interest rate in 2026?
With benchmark rates near 3.9%, the lowest published rates on a $25K balance are about 5.2–5.4% (Webull Premium, Robinhood and IBKR Pro). Full-service brokers such as Schwab, Fidelity and E*TRADE charge about 11.5–12.2%. Rates below 5% generally need balances above $100K or a paid subscription.
Which broker has the lowest margin rate for retail traders?
At a $25K balance, Webull Premium (5.20% with a $3.99/month subscription), Robinhood (5.25%) and Interactive Brokers Pro (5.38%) have the lowest published rates. IBKR stays among the lowest at every balance without a subscription. Compare each tier schedule against the balance you actually carry.
Does margin rate matter if I only hold positions overnight occasionally?
Yes. At $50,000 borrowed for 60 nights, a 1% rate difference costs approximately $82 annually. Calculate based on your expected holding frequency—even infrequent overnight holds accumulate over time at higher leverage levels.