lending at a rate

Lending at a rate

Interest paid to a customer on the credit balance received from a short sale.

Lending at a Rate

The interest a brokerage pays to a client whose funds it is holding in escrow. When a client borrows securities from a brokerage and sells them, the brokerage usually collects the sale price and holds it until the client repays the borrowed securities. If the brokerage lends at a rate, it pays the client interest for holding securities.

lending at a rate

The payment of interest by a broker-dealer on a customer's credit balance from a short sale. When the investor sells short, the broker holds the proceeds from the sale in escrow to secure the securities borrowed for the short sale. In certain instances the broker may pay the customer interest on this balance.