Borrow rates for short selling

Before entering a short position, you’ll receive a message outlining how much it would cost per day to borrow the selected security (when applicable) along with your order confirmation.

If you accept the payment and trade, your order will be sent to the exchange, and you will be charged for each full day you hold the short position (risk reviews may still apply).

Rates fluctuate based on the security’s market value, demand, and available inventory.

If fees increase beyond the amount you’re willing to pay, all you have to do is buy to close your short position before 8:00 p.m. ET to avoid being charged.

Once you enter a short position, you will find current rates by going to the Positions tab and hovering over the R icon.

Important to know

• Intraday shorting - no borrowing fees will apply unless you hold your borrowed shares overnight (excluding commissions)
• You can view borrow rates from your level 1 & level 2, Watchlist, and Positions tabs
• Questrade reserves the right to cover your short positions at any time without prior notice
  • This means your borrowed shares will be recalled (a request from Questrade to return the borrowed securities), which could require Questrade or you to buy them back to close the short position.

For your reference, daily borrow fees are calculated as follows:

(Borrow rate) x (market value of the security)/365 days in the year

Here's an example:

You borrow 100 shares of AAPL to short. You hold the shares past 8:00 p.m. ET and sell them the next day.

At the end of the day, the stock was valued at $130 per share, making your total short position $13,000. Now suppose that the stock is in high demand, so your borrow rate is at 20%.

Your borrow fee for the day would be (20% x $13,000)/365 = $7.12.

The borrow rate shown in the borrow rate agreement is an estimate of what the borrow rate for your investment will be.