Series 66 Question of the Week

The broker call loan rate is:

A. The rate that member banks charge each other for overnight loans

B. The rate that banks charge their most credit worthy corporate customers on loans

C. The rate that the Federal Reserve Bank charges member banks on loans

D. The rate that banks charge to broker dealers to finance their customers’ margin purchases

Correct Answer(s):

D. The rate that banks charge to broker dealers to finance their customers’ margin purchases

Explanation:

The broker call rate is the rate that banks charge to broker dealers to finance their customers’ margin purchases