interest on selling naked options

Discussion in 'Options' started by tradingcards, Sep 12, 2007.

  1. I use IB. Since selling naked options requires margin, do you get charged interest for selling naked options? If so, how do most places calculate the interest rate to charge and on what amount do they charge?

    I would appreciate any answer from anyone with knowledge on this using any broker.

  2. Brokers don't charge you interest for margined positions. They charge you interest for borrowing cash. If you don't have a negative cash balance in your account, you won't pay interest.

    I'm with IB too. I have a bunch of margined positions every month, and they pay me interest on my positive cash balance.