Interest on or investing of short sale proceeds

[Chuck Krug]

Interest on or investing of short sale proceeds.
Interactive brokers only gives a tiny amount of yield on cash that comes from short sales.(and in tiers) What is the industry standard, and are there banks/ brokers who allow you to put the proceeds into 30y T-bonds? Thanks.

 

[IBj]

Quote from Chuck Krug:

Interest on or investing of short sale proceeds.
Interactive brokers only gives a tiny amount of yield on cash that comes from short sales.(and in tiers) What is the industry standard, and are there banks/ brokers who allow you to put the proceeds into 30y T-bonds? Thanks.

Actually IB's interest on short sale proceeds is pretty good, especially for USD. The problem is that interest rates are simply so low that any spread at all around fed funds, basically means zero rates. Everyone's credit rates are just above zero. If/when interest rates return to normal levels, the IB rates will compare quite favorably.

You can invest cash, regardless of how it was raised, in US Govies via IB . Please see the bond product offering on our web site.
http://www.interactivebrokers.com/en/p.php?f=products

 

[Chuck Krug]

interactive brokers doesn't allow proceeds from short sales to be invested in T bonds.