call loan

Broker's call

Broker's call, also known as the Call loan rate, is the interest rate relative to which margin loans are quoted. Individuals may borrow on margin a part of the funds they use to buy their securities from their broker. The broker, in turn, may borrow funds from a bank (with an agreement to repay the bank immediately on call). The rate paid on such loans is about 0.75 – 1.25% higher than the LIBOR.

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