Short Borrow Fee Interest Calculation

Discussion in 'Interactive Brokers' started by deanstreet, Jun 11, 2021.

  1. I am not very clear on how short borrow interest fee is calculated.

    I shorted 3700 NIO shares today and its share closed at $42.8 today.

    I don't understand why the loan is based on $45 instead of $44.

    Code:
    Loan per share = Ceiling (closing price x 102%)
                   = Ceiling (42.8 x 1.02) = 44 != 45
    
     
  2. How do you know on what price the loan value is based? Did IB inform you of that?
     
  3. It is shown in the statement obviously.
     
  4. traider

    traider

    I think they round the share price up. Also the short interest rate fluctuates throughout the day
     
    MoreLeverage likes this.
  5. comagnum

    comagnum

    This is what I use to calculate the daily short carry cost. The current NIO fee rate I used is 0.29% for NIO.

    upload_2021-6-10_21-50-6.png

    Column I formula =(G48*102)*F48/360*H48/100
     
    Last edited: Jun 11, 2021
  6. d08

    d08

    Isn't the short interest rate based on the closing price? There's no intraday interest anyway for shorts.
     
    MoreLeverage likes this.
  7. I will confirm with IBKR if the loan stock price deviates from my understanding for a few more days. I just guess that for some more-volatile stocks, the price factor is above 102%.
     
    zdreg likes this.
  8. lpope

    lpope

    There's a lag in borrow fees on the statement. Borrow is on T+0 and stocks are on T+2 so the price used in the calculation lags by two trading days.
     
    deanstreet likes this.
  9. Ah..maybe that's exactly what it is