Interest on cash balance

I think it would be a great idea for 212 to introduce interest on cash balances. 3% would be great. Old school of thought would be to hold cash in a world tracker whilst waiting for opportunities, but lets be honest the best opportunities also coincide when the equity markets as a whole are under performing. So whilst we wait would be great to earn some interest in my ISA. Otherwise I just hold cash in a savings account and transfer it. I think it would encourage more cash on books if 212 offered interest.


That would be nice.

However you could invest your cash into Xtrackers II EUR Overnight Rate Swap (Acc).

Right now it yields 2.4% per year. You can check it here: Euro Short-Term Rate

Everything trading 212 does is to get you to do one thing: trade

  • They send notifications telling you stocks are up or down to create fomo so you trade .

  • They create a hot list showing which stocks are hot so you trade more.

  • They create forums where you discuss merits of stocks so ultimately there will be more trading.

  • They create an app with charts and graphs and buttons to trade so easily and frequently from anywhere/anytime.


The idea of giving people incentive for holding cash and NOT trading goes against their entire business model/ethos so I don’t think this idea would make any sense for them as much as some of us would like it.

How does that work, with them losing money mostly on every trade and all :thinking:

Yes I understand it’s against their business model but they do not make money on ISA anyway so at least if they attract high deposits it can hedge their profitable part of the business more

Sorry I have no idea how this works, what is the risk associated with this instrument? With a savings account my cash is 100% secure, 0 risk. I assume this instrument comes with risk

Nope, it exposes you to FX currency risk. It’s EUR denominated by the looks of it, so you take on rate exposure of you convert into it from GBP - this could easily outweigh the interest of the rate moves against you.

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IBKR offers interest on idle cash.


If that was the case why would Interactive Brokers offer interest on cash?

Edit: just realized Marco already pointed that out, oops xD

IB don’t really offer much though. It is tiered, so unless you have loads in your account then you get nothing.

Unfortunately I don’t know what the risk implications are.

That’s correct.

It depends what your desired currency is. For me it’s euros, so no currency risk for me.

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I believe Trading 212 keep the interest on cash as part of the deal for providing commission free trading. Don’t think it would be possible, and if it was the interest rate wouldn’t be the most attractive.


This is a pretty good option! Just found it on Trading 212:


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Thinking about replacing USD Treasury ETF with this one in my pie. Hmmm interesting indeed

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How and when is the 2.4% paid?

I think it’s paid every day, so 2.5% / 365 per day.

It’s accumulating, so no payout at all. According to the KID performance is 0.4% last year. That’s about the same as a savings account at a bank. Therefor it’s the lowest risk level.

Can’t find anything of 2.4%

Lightyear currently offers 3.25% on GBP, 3.75% on USD and 1.75% on EUR.
There is no ISA in LightYear and very less instruments compared to Trading212.

Other option is, if Trading212 considers to include Money Market Fund instruments which are available in IBKR.


It’s accumulating, so no payout at all.

Correct. There’s no payment - it’s the ETF’s price that increases. The net effect is the same.

According to the KID performance is 0.4% last year.

That’s because rates were low last year but have been increasing since.

Can’t find anything of 2.4%

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