You will be charged $5 every 30 days at the beginning of your billing cycle. Margin interest rate of 7.25% vs 11.25% with a standard accountįor $5 a month, you get all the Robinhood Gold premium features, and your first $1,000 of margin is included.Robinhood Gold comes with a number of great features: They have the standard account and the Robinhood Gold account for $5 a month. Robinhood offers investors two different account options. $3,000 * (11.25% / 360) = $0.94 per dayĬompared to Webull margin and many of the other options out there, Robinhood's pricing is highly competitive.With $3,000 borrowed, you will accrue $0.94 per day. With a standard account, you will pay 11.25%. The interest that you will owe is calculated daily and charged to your account at the end of the month. Interest begins accruing after a transaction is settled and will continue accruing until the margin is paid back. Suppose you borrow $3,000 with a standard account. To better understand this rate, let's look at an example: With Robinhood Gold, you gain access to a discounted rate of 7.25%. The interest rate that you pay depends on your account level. In order to access margin, you ought to understand the margin rate or the interest rate that you will pay. You also need to consider the margin rate that would come out of your profit (or loss). Had you invested just $5,000 instead of using margin to invest $10,000, then your profit would have been $1,250. You sell the investment and repay the $5,000 borrowed leaving you with $7,500. With that, you choose to invest in company XYZ and buy 100 shares at $100 a piece for a total of $10,000.Īfter a period of time, the share price increases to $125. You also decide to use margin and borrow an additional $5,000. This is turn can increase their returns.Ĭonsider this example: say you have $5,000 to invest. Investors can increase their buying power buy borrowing funds from the brokerage. Get 1 Free Fractional Share Worth $5 To $200īefore diving into all the details, it is important to understand how margin trading works.
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