How is margin interest calculated?

They way I figure it should be done is as follows. It should be the margin rate divided by days in a year. That number times debit amount times days held.


.06 (Annual rate)/ 364 (Days a year)= .0001648 (Daily Rate)

.0001648 * 10,000 Margin Debit)= 1.648 per day

Isn't that right?
 
winter: How much margin did you use on that one day, though?

$1147 is the average balance if you used $30969 one night, and $0 on the other 26 nights.
 
Quote from alanm:

winter: How much margin did you use on that one day, though?

$1147 is the average balance if you used $30969 one night, and $0 on the other 26 nights.
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Yea good point - that is possible and actually likely.
 
In my case it was for sure $20k margin balance for one day resulting in $100 interest charge.

The failed money market sweep can explain the problem because when it fails to return cash to my account at the beginning of a day, whatever trades I make that day will be on margin and trigger interest accumulation.
 
You shouldn't be charged margin on intra-day trades, and if it didn't sweep your cash back in, I'd think you'd have gotten a margin call. In any case, I guess they're on it. Hard to believe a big firm like Penson doesn't have checks and balances to catch something like that (i.e. their margin income suddenly skyrocketing), and that nobody has noticed it until now.
 
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