SoFi now offering margin investing at one of the lowest rates, but still lacks options

SoFi is now offering customers the ability to trade on margin. The introductory rate is one of the lowest in the industry. Through May 31, 2022, SoFi’s margin rate will be 2.5%. Beginning on June 1, 2022, SoFi will increase its margin rate to 5%, which is still quite low considering that brokerages that do offer similar rates only do so after the customer initiates negotiations. 

Despite offering low margin rates, SoFi’s lack of options trading takes SoFi out of the race for some investors. While SoFi’s offerings may be sufficient for the beginner investor, and even some long-time investors, options trading, already a big part of the investment world, is becoming increasingly popular.

According to the Options Clearing Corporation, almost 40 million contracts were traded on average each day in 2021, and the so-called “retail investor” accounted for 25% of options trading. Mini options were recently introduced as a way for small-time investors to take part in options trading without committing to a large investment. There’s no denying that there’s a huge customer segment that SoFi is leaving behind.

We have a financial stake in SoFi. As with all products and services covered on Matters Pecuniary, our financial interests have no influence on our writings.