Interest Markups and Markdowns

Instructions

You can mark down credit and short proceeds credit interest, and mark up debit interest. Markups and markdowns are entered as %. To specify the interest markups and markdowns, follow the steps below.

  1. Click Menu in the top left corner > Administration & Tools > Fees & Invoicing > Fees
  2. The display selector will open on the right side.
    • To sort the list by any column heading, click the arrow next to that heading.

    The select account panel in portal.

  3. Select an account you'd like to charge a markup to.
  4. Select a Client Fee Template if you wish to use one.

  5. Select the Fee Strategy from the drop-down menu

    Image of the select fee strategy panel in portal.

  6. Select the Interest Rates check box and the currency on which you are looking to charge an interest markup / markdown.

    Image of the interest rates check box option in portal.

  7. Specify the interest rate fees you are looking to charge. For more information on this, click here.

    Image of the specify the interest rate fees in portal.

  8. Press Continue to review, then Save.

You can charge markups as a variable or fixed percentage of the IBKR borrow rate, and the system will apply the rate that results in the larger total amount.

  • Variable borrow fee markup -is a variable percentage of IBKR's borrow rate. The total cost to your client is calculated as follows:

    • Borrow Rate (1 + Variable Markup Percentage)

    • The range of acceptable values that you can enter is 0 - 25%.

  • Fixed borrow fee markup is a fixed percentage of IBKR's borrow rate. The total cost to your client is calculated as follows:

    • Borrow Rate + Fixed Markup Percentage

    • The range of acceptable values that you can enter is 0 - 1%.

Example

Symbol ABC Borrow Rate = 35%

Variable Borrow Markup = 20%

Fixed Borrow Markup = 1%

Calculating the total cost to your client, we have:

  • Variable Markup:

    • 35% (1+20%) = 42% total cost to your client

      or

    • 0.35 (1.2) = 0.42

  • Fixed Markup:

    • 35% + 1% = 36%

      or

    • 0.35 + 0.01 = 0.36

Our system applies the larger total amount which, in this example, would be the 42% Variable Borrow Markup including both our borrow rate and your borrow markup.

Note: Interest markups and markdowns are rounded to two decimals.

Learn more about Interest Markups and Markdowns at IBKR Campus.

 

Additional Resources

Learn About Broker Interest Rate Markups at IBKR Campus

Visit the IBKR Broker Portal Website

Log in to Client Fees