5 Brokers with the Best Margin Rates

Margin trading can amplify potential returns by borrowing capital from their broker. But leverage is a double-edged sword. While gains can be magnified, so can losses. The interest expense on borrowed funds often becomes the deciding factor between a profitable trade and a net loss.

In 2025, as the Federal Reserve's interest rate trajectory becomes clearer, the margin lending landscape is shifting once again. Brokers are actively competing for market share by offering lower margin rates than they have in years. For traders weighing their options, this creates an opportunity: Finding a broker whose margin rates align with their strategy and account size can meaningfully improve returns over time.

Investors are comparing brokers to find the best margin rates available. If an investor is considering margin investing, this guide breaks down five of the best brokers offering competitive and transparent rates right now.

Why Margin Rates Matter?

Consider the math. A trader borrowing $50,000 at a 5% annual margin rate pays $2,500 in interest annually. At 5.75%, that same loan costs $2,875: A difference of $375 on a single position. Scale this across multiple positions, compound it over years, and the cumulative impact on profitability becomes substantial. This is why institutional traders and sophisticated retail investors scrutinize margin rates with the same rigor they apply to stock selection.

Here are five brokers currently leading the pack when it comes to low-cost margin borrowing.

Public.com

Public.com has emerged as one of the most consumer-friendly investing platforms in recent years and has always been known for commission-free trading and educational content. It has now expanded into margin investing, and that too with highly competitive margin rates as compared to the mainstream brokers. Its margin rates are around 5.40% for smaller balances and drop to roughly 4.45% for higher-tier margin balances. It is ideal for retail investors and mid-level traders who want simple pricing without hidden fees. Public.com offers transparent, tiered pricing that’s easy to understand. The investor knows what they are paying for. The platform also integrates community insights, live data, and real-time news, helping the trader in making informed trading decisions. For retail investors who want low borrowing costs and a modern app interface, Public.com is a solid choice in 2025.

Interactive Brokers

Interactive Brokers, popularly known as IBKR, remains the go-to platform for professional and high-volume traders who prioritize the absolute lowest margin rates possible. IBKR uses a blended tiered-rate model, meaning the investor's effective interest rate depends on the size of their borrowing. The margin rates that IBKR offers are as low as ~4.610% for IBKR Pro users, depending on loan size. It is an ideal choice for active and professional traders maintaining large margin balances. IBKR’s global presence, deep liquidity, and advanced tools make it a great choice for serious investors. Interactive Brokers consistently beats most competitors, when it comes to large margin balances and even for moderate balances, its tiered system produces some of the lowest effective rates in the industry. The platform also provides a margin calculator that shows exactly what the trader would have to pay if they borrow money on margin. This is a transparency feature that not many brokers provide.

Robinhood

Robinhood, known for pioneering commission-free trading, now competes aggressively on margin pricing too. Through its Robinhood Gold subscription, users can gain access to competitive borrowing rates and additional research tools. Its margin rates typically hover around 5.5%, with reductions for larger balances. It is one of the best choices for casual investors seeking low-cost, user-friendly trading. Robinhood makes margin trading straightforward with flat, predictable pricing. The platform also occasionally offers interest-free borrowing up to a small limit for Gold members, making it even more cost-effective for smaller positions. Combined with a clean interface and fast execution, Robinhood delivers one of the most affordable margin rates in the mobile trading space.

TradeStation

TradeStation is a standout choice for traders who want professional-grade tools without bearing institutional-level costs. Known for its robust trading software and analytics, it also offers competitive rates for margin traders, making it one of the top players, even in this segment. Its margin rates start around 4.75%, depending on the trader’s balance and trading activity. It is a solid pick for active traders and technical analysts who want a high-performance platform as TradeStation combines advanced analytics with low-cost margin access: A balance that appeals to experienced traders. Its rates are highly competitive for mid-to-large accounts, even though when it is not the cheapest in the list. TradeStation provides strong overall value for investors who value execution speed, customizable charts, and cost control.

Fidelity

Fidelity is one of the largest and most trusted brokerage firms in the U.S. While its base margin rate is higher than that of discount competitors, it still offers competitive tiered reductions for larger accounts. Its base margin rate is 11.075%, but drops substantially for large debit balances and goes down to 8.00%. It is best for long-term investors with multi-product relationships (brokerage, IRAs, etc.), so that investors can get all the services under one roof, making it easy for them to handle their financial investments and trading activities. Fidelity’s reliability, research quality, and service offset its slightly higher rates for smaller accounts. For investors who prefer keeping all their financial accounts under one roof and are not constantly trading on margin, Fidelity’s margin structure is a great and dependable choice.

Tips to Secure the Lowest Possible Margin Rate

Increasing the margin balance: Many brokers reward larger debit balances with lower interest tiers. If a trader regularly borrows on margin, consolidating their holdings with one broker can unlock cheaper rates.

Using a margin calculator: Brokers like Interactive Brokers and Public.com provide calculators to estimate real APR. An investor should always check this before trading on margin.

Comparing effective rates, not just “as low as” figures: The lowest tier rate may not apply to a trader unless they borrow above a certain threshold.

Watching out for promotional offers: Some brokers offer reduced rates for a limited time when opening or funding a new margin account.

Staying updated about what’s going on in and around: Margin rates shift with the Federal Funds Rate. A broker that’s cheapest today might not be the lowest next quarter, and keeping a tab on all this can benefit the traders in making an informed decision.

Who Really Offers the Lowest Margin Rates?

• Best for Small to Mid-Level Balances: Public.com
• Best for Large Balances and Professionals: Interactive Brokers
• Best for Simplicity: Robinhood
• Best for Advanced Traders: TradeStation
• Best for Full-Service Investing: Fidelity

In margin trading, every fraction of a percent counts. Choosing a broker with the best margin rates can reduce borrowing costs, increase returns, and give an investor the required flexibility for leveraging their portfolio. One should always verify the most current margin schedules before trading.