Carry Trade For Dummies

There is an interesting Interactive Brokers ad I have heard on Bloomberg radio numerous times recently. They start out by telling listeners that they offer margin rates as low as 1.5% or something like that. They then go on to say that they have a list of hundreds of stocks that pay a dividend of over 5%. They let the listener put two and two together and feel quite smart about themselves. After planting the idea they go ahead and warn about how these stocks might go down in a much less interesting manner.

1 comment:

Random Thoughts said...

i heard it too. they lend at 5-1. i love that ad. i cant imagine how many people are doing it. you know, it will work till it doesnt.