Interest and Financing

Interest and Financing Pricing

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Interest Schedule

Venom by Cobra Trading uses internationally recognized benchmarks on overnight deposits as a basis for determining interest rates. We then apply a spread around the benchmark interest rate (“BM”) in tiers, where larger cash balances receive increasingly better rates, to determine an effective rate.

Benchmark Rates

The current day benchmarks are as follows:

Benchmark Rates as of 12/09/2016

Currency Benchmark (BM) Rate
USD Fed Funds Effective (Overnight Rate) 0.410%
USD 11 am GMT USD LIBOR (used only for USD-CFDs, Gold and Silver Borrow Fees) 0.434%
FINRA Pass-Through Fees Venom by Cobra Trading Tiered Commissions*0.00056

Venom by Cobra Trading accrues interest on a daily basis and posts actual interest monthly on the third business day of the following month. For detailed examples on how we calculate interest, open the Interest Paid to You and Interest Rates Charged to You on Margin Loan Balances sections on this page.

Interest Benchmark Definitions

Fed Funds Effective (USD only) is the volume weighted average of the transactions processed through the Federal Reserve between member banks. It is intended to reflect the best estimate of interbank financing activity for Reserve Bank members and is the reference for many short term money market transactions in the broader market.
LIBOR (multiple currencies) stands for London Inter-Bank Offered Rate. It is a daily fixing for deposits with durations from overnight to 1 year and is determined by a group of large London banks. It is the most widely used measurement for interest rates on most currencies outside the domestic market(s).
Overnight (O/N) rate is the most widely used short term benchmark and represents the rate for balances held from today until the next business day.
Spot-Next (S/N) refers to the rate on balances from the next business day to the business day thereafter. Due to time zone and other criteria, Spot-Next rates are sometimes used as the short-term reference.

Disclosures

 

  1. The applied rate may be reduced if pre-arranged. Please contact Customer Service to discuss further.
    • Costs for position borrowing of stocks with special considerations (for example hard to borrow instruments) are usually higher than for normal availability stocks. These additional costs will be passed on in the form of lower short stock credit interest. Please note that this may lead to a net debit short stock credit interest in the event that the costs to borrow exceed the interest earned. In order to view the indicative short stock interest rates for a specific stock, Venom by Cobra Trading recommends that clients use the Short Stock (SLB) Availability Tool in the Support > Tools menu in Account Management.

Interest Paid to You or By You

When calculating rates, Venom by Cobra Trading uses a blended rate based on the tiers below. Interest accrues and is payable on a daily basis, and Venom by Cobra Trading posts actual interest monthly on the 3rd business day of the following month. The tiers on which interest is based may change from time to time without prior notification to clients. Such adjustments are done periodically to adjust for changes in currency rates. For the purposes of crediting interest on either long settled cash balances or short stock collateral values, only accounts with Net Asset Value (NAV) exceeding USD 100,000 will be eligible to receive credit interest on long settled cash balances.

Interest Paid to You on Positive (Credit) Cash Balances

BM = Benchmark Rate

Currency Tier Rate Paid
USD 0 – 10,000 0%
10,000.01 + 0% (BM – 0.5%)

Interest Paid to You on Short Sale Proceeds Cash Balances

For the purposes of crediting interest on either long settled cash balances or short stock collateral values, only accounts with Net Asset Value (NAV) exceeding USD 100,000 will be eligible to receive credit interest on long settled cash balances.

BM = Benchmark Rate

Currency Tier Rate Paid
USD 0 – 100,000 0%
100,000.01 – 1,000,000 0% (BM – 1.25%)

Disclosures

 

  1. The applied rate may be reduced if pre-arranged. Please contact Customer Service to discuss further.
    • Costs for position borrowing of stocks with special considerations (for example hard to borrow instruments) are usually higher than for normal availability stocks. These additional costs will be passed on in the form of lower short stock credit interest. Please note that this may lead to a net debit short stock credit interest in the event that the costs to borrow exceed the interest earned. In order to view the indicative short stock interest rates for a specific stock, Venom by Cobra Trading recommends that clients use the Short Stock (SLB) Availability Tool in the Support > Tools menu in Account Management.

 

Interest Rates Charged to You on Margin Loan Balances

When calculating rates, keep in mind that Venom by Cobra Trading uses a blended rate based on the tiers below. For example, for a balance over 1,000,000 USD, the first 100,000 is charged at the Tier I rate, the next 900,000 at the Tier II rate, etc. When determining the quoted spread, Venom by Cobra Trading will use the set benchmark rate or a benchmark rate of 0 for all benchmark rates less than 0. Venom by Cobra Trading accrues interest on a daily basis and posts actual interest monthly on the third business day of the following month. The tiers on which interest is based may change from time to time without prior notification to clients. Such adjustments are done periodically to adjust for changes in currency rates.

Currency Loan Amount Rate Charged
USD 0 – 100,000 1.91% (BM + 1.5%)
100,000.01 – 1,000,000 1.41% (BM + 1%)
3,000,000.01 – 200,000,000 0.66% (BM + 0.25%)
200,000,000.01 + 0.66% (BM + 0.25%) See note below

Note: May be subject to a 1% surcharge applied to the spread if financing is not pre-arranged.

Disclosures

 

  1. The applied rate may be reduced if pre-arranged. Please contact Customer Service to discuss further.
    • Costs for position borrowing of stocks with special considerations (for example hard to borrow instruments) are usually higher than for normal availability stocks. These additional costs will be passed on in the form of lower short stock credit interest. Please note that this may lead to a net debit short stock credit interest in the event that the costs to borrow exceed the interest earned. In order to view the indicative short stock interest rates for a specific stock, Venom by Cobra Trading recommends that clients use the Short Stock (SLB) Availability Tool in the Support > Tools menu in Account Management.