Why does my broker pay very low interest on cash? PDF Print E-mail
ANSWERED QUESTIONS - ANSWERED QUESTIONS
Saturday, 17 April 2010 18:52
Brokers earn their money from trading commissions. Only. Unlike brokers, banks take your money and invest somewhere else for a higher return. Then they share part of that return with you by paying y our interest. By law, brokers aren't allowed to do that. So they have to give you low interest on cash to make you buy and sell securities instead, and pay them commissions.

Hope this explains.

Good  luck!

Moni.


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