Trade King Is Ripping People Off with Hard-To-Borrow Fees for Shorting Stocks
I was made aware this morning by one of the people in the SharePlanner chat-room that they are being charge astronomical "Hard-To-Borrow" fees for shorting stocks. Even for a lot of your regular, "run-of-the-mill" stocks are being charged a high percentage fee tagged with shorting them. This is troublesome to me, especially considering that unless you call a representative at TradeKing prior to placing your trade and ask, you have NO WAY of knowing whether or not you are going to be charged an unbelievable percentage fee or not.
What is even crazier, is that they might tell you that on the day you place your trade the fee is only 2%, but then the next day you may get an email AFTER you are in the trade and inform you that your Annual "Hard-to-Borrow" fee has increased to 100% or more annually. Honestly that is one of the most absurd things I have ever heard of a brokerage firm doing, and when I questioned them about, they were clearly "business as usual" about it. So if you think I am making this stuff up, just check out my transcript of my chat with these folks. There are even people fussing about this one their own website.
This messes up people's ability to trade in the equity markets, and the job of a brokerage firm is to enhance the "ease-of-trading" not increase the difficulty of it. Some brokerage firms get that, and clearly TradeKing doesn't. So if you are with TradeKing and your trading strategy involves shorting stocks, then I would take your services elsewhere immediately.
I haven't seen something as crazy as this, since the TSA started groping people legally for refusing full-body scans at airports.
Here's my conversation with a TradeKing representative.