09-06-2015, 06:30 PM
Yep...Basically Mr. Peterffy has somehow found a good business model with IB (he is IB's CEO) to keep rates low (they are essentially floating rates- 1.5% plus Fed Funds rate). It is definitely on his whim. I will say that Fed Funds rates reached 5s and 6s as recently as the early 2000s. So it is not always going to be a free lunch.
I know an ultra high net worth individual who negotiated with Fidelity to give him a fixed 2% margin rate. His wife flips houses with it. I don't know how big his account with them is, all I know is he sold a business and has been trading (not investing) in the market for years. I guess if your account is big enough you might be able to negotiate with your brokerage.
I know an ultra high net worth individual who negotiated with Fidelity to give him a fixed 2% margin rate. His wife flips houses with it. I don't know how big his account with them is, all I know is he sold a business and has been trading (not investing) in the market for years. I guess if your account is big enough you might be able to negotiate with your brokerage.