How do I estimate margin interest?
Multiply the amount borrowed by the annual interest rate and by the fraction of a year the balance is outstanding. This page uses simple interest and a 365-day year: interest = debit balance × annual rate ÷ 100 × days ÷ 365. For example, a hypothetical $10,000 debit at an entered 10% annual rate for 30 days gives $82.19 before rounding. This is an arithmetic example, not a quoted brokerage rate.
The calculator assumes the entered balance and rate stay constant for every day in the period. If your debit changes, calculate separate intervals for each balance and rate, then add the interval estimates. A broker may use average daily balances, a different day-count convention, tiered or variable rates, compounding, or other terms. Check your account agreement and statement for the firm’s method and actual charge.
Where can I find my rate and debit balance?
Use the rate and balance shown by your brokerage or the applicable account documents. FINRA’s margin guidance describes borrowing through a margin account and highlights risks associated with using borrowed funds. The SEC’s investor bulletin on margin interest explains that firms set interest charges and encourages investors to ask how interest is calculated. The figures you enter here are your own assumptions; this page does not retrieve a rate from a broker.
How is margin interest different from a maintenance call?
Interest is a borrowing cost. A maintenance call concerns whether account equity satisfies the applicable minimum. For a simplified account holding only a long margin stock, equity is market value minus the margin debit, and the equity percentage is equity divided by market value. FINRA says that, generally, equity in an account holding only margin stocks must not fall below 25% of current market value; firms can set higher house requirements and may change them. The actual calculation can differ for other holdings and account terms.
For illustration only, suppose a single position is worth $20,000 and the margin debit is $10,000. Equity is $10,000, or 50% of market value. At an assumed 25% maintenance requirement, the simple threshold equation is market value − debit = 0.25 × market value, which gives a market value of about $13,333.33 for that unchanged debit. This is not a call prediction or a safe-price estimate: firms may use higher or changing requirements, monitor intraday, and liquidate assets under their agreements. Review the current requirements with your broker. FINRA’s margin-call guidance (published June 4, 2026; accessed 2026-11-04) explains common triggers and broker discretion.
What does this estimate leave out?
It does not determine buying power, initial or maintenance margin, eligible collateral, margin calls, liquidation, or the amount a firm will lend. Those depend on account terms, securities, applicable rules, and the broker’s requirements. It also does not project investment gains or losses. Borrowing costs can accrue while an investment falls in value, and a firm may have rights under the account agreement to sell assets. Read the margin agreement and ask the firm how its interest and risk controls work.
The simple formula does not add unpaid interest to principal, so it is not a compound-interest model. It does not account for cash credits or offsets, balance tiers, changing rates, payment timing, fees, or taxes. For a period that crosses rate changes or balance changes, split the period into segments using the relevant user-verified inputs. Compare the estimate with the broker’s posted calculation before relying on it.
Sources and date: FINRA, Guidance on Margin; SEC Investor.gov, Interested in Margin? Understand Interest, accessed 2026-11-03; FINRA, Know What Triggers a Margin Call, published 2026-06-04 and accessed 2026-11-04. The day-count formula is an explicitly selected calculator convention, not a claim about any firm’s billing method.
This educational calculator is not a recommendation to borrow or invest and is not financial, tax, or legal advice.
Frequently asked questions
Does the calculator use a broker’s current margin rate?
No. Enter a rate from the terms or information you have verified with your brokerage. The tool does not fetch or infer rates.
Why use 365 days?
It is the stated convention for this simple scenario. Your brokerage may use a different day-count method, so compare with its agreement and calculation.
Does this compound interest?
No. It applies the entered annual rate to the entered principal for the selected days without adding interest to that principal.
Does this estimate tell me how much I can borrow?
No. It estimates interest only. It does not determine eligibility, collateral requirements, buying power, or maintenance requirements.