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Introduction > Banking Services > Loans > Margin Trading > Details of margin trading in the U.S.

Credit for securities trading in the U.S.

In the US you may fund your security purchases with a credit for up to 90% of the value of purchased securities. What is more, the credit agreement allows you to speculate on a drop of the rate of selected securities, or perform an operation known as a "short sale".

How much credit can be used?

  • 50% for all shares, which can be purchased through credits
  • 80% for QQQ title, which copies the NASDAQ 100 index
  • 80% for PSQ title, which inversely copies the NASDAQ 100 index
  • 90% for SPY title, which copies the Standard & Poor's 500 index
  • 85% for SH title, which inversely copies the Standard & Poor's 500 index
  • 90% for DIA title, which copies the Dow Jones Industrial Average 30 index
  • 85% for DOG title, which inversely copies the Dow Jones Industrial Average 30 index

All securities, which can be purchased with credit are marked by "M"symbol in e-Broker application.

 


What kinds of securities allow speculation for decline?

Securities, which allow speculation for rate decline are marked by "S" symbol in e-Broker application. If the securities are marked by "M + S" symbol, it means that a part of the speculation may be funded by a credit.

 


How much does the credit cost and how to get it?

Cost of the credit and conditions for getting one differ according to the type of contract you have.

 


INFORMATION FOR CLIENTS WITH FRAME INVESTMENT AGREEMENT

If you have a frame investment agreement effective on 15 July 2015, the following conditions apply to you.

How much does a credit cost?

Your only cost will be credit interest on the lent amount at the end of the trading day. If at the end of the day you have no credit (margin), you do not pay any interest. Opening and eventual termination of the credit is completely free!

  • The basic interest rate: 8.5 % p. a.

The interest from credit is typically charged on the first day of the following month. However, if the credit in a calendar month exceeds the average credit values listed in the table, the resulting interest rate for this month will be lowered automatically by volume discounts specified in the table.

  


How to ask for a credit?

If you want to arrange a credit for securities trading in the United States, log in to your e-Broker business application and click on the "Agreements and Services" link at the top of the page. A table named "Accounts" will be displayed, where you need to click the "Create new" link and follow the instructions on the screen.

Once you create a new account (which you will be able to see in the table), click on the "Request to activate the credit and loan agreement for investment instrument trading" in the "Operations" column. This will submit the request for securities trading credit for assessment and you will be informed of the result by a message sent directly to your e-Broker application.

 

 


INFORMATION FOR CLIENTS WITH CONSIGMENT AGREEMENT

How much does a credit cost?

Charges for securities trading credit consist of two parts.

1) Fees for establishment of credit framework

These are to be paid for 3 months in advance and are non-refundable. At the signature of the loan agreement you specify the amount of your credit framework. Credit framework (limit) is the maximum amount the creditor (Fio banka) will lend you any time during the term of the Credit Agreement. You may increase, decrease or terminate your credit framework by execution of an amendment to the Credit Agreement. This must be done in person at any branch of the bank.

2) Fees for actual credit use

Credit charges are calculated in the overdraft manner from the credit account balance at the end of the trading day. The interest from credit is typically charged on the first day of the following month. If you withdraw a loan during the day and you repay the loan before the end of trading - no intraday trading interest is charged. The amount of interest from the credit depends on the average amount of credit drawn in the given month.

 

Possible credit

Annual interest
rate
Loan origination
fee (quarterly)
Trading
fee
  up to 90 % 8,95 % p. a. max. 0,47 % Standard

 

 

 


How to ask for a credit?

If you want to arrange a credit for securities trading in the US, and you do not have a Frame Investment Agreement, just come to any of our branches, where you may sign a Securities Trading Credit Agreement.

If you are not yet a client of Fio banka, learn how to become one here.


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