A couple months ago I moved my accounts from Scottrade to E*TRADE. I have a margin account plus two IRA accounts. I was being charged 7.5% for my margin money*, and paid 0.10% for cash [in my IRAs], and paying $7 for each trade.
Since the interest rate is near zero, and I’m being charged 7.5%, I called up Scottrade asking for a lower margin rate. They didn’t seem too favorable to changing it up, and in fact, told me to call them back on Monday, but in the end, they said they’d lower the margin rate by 1%.
In the meantime, I called up E*TRADE, which just happened to be the first company to pop into my head. The guy immediately said that he’s VERY confident he can get me $6 trades and 4% margin interest. So…I went with E*TRADE.
I’m unsure what interest rate I’m getting on cash in my IRAs, but the amount is 10 – 20 times more than what I got at Scottrade! NOT a lot, but it’s more than the 12 cents that I was getting at Scottrade.
AND once I got used to their system/website, I like it much better than Scottrade’s.
LESSON LEARNED: it pays to call around and negotiate.
* The interest charged on margin money depends upon how much money you have on margin. The MORE money on margin, the LESS the interest rate is. Thus, one is encouraged to use as much margin money as possible.