Electronic Brokerage firm Interactive Brokers Group Inc. (IBKR) - Get Interactive Brokers Group Inc. Report has a new policy that will make it more expensive to trade shares of Tesla Inc. (TSLA) - Get Tesla Inc. Report on its platform. The firm told clients that it will increase its margin requirement for investors looking to trade Tesla to 30% for regular accounts, from 25%, and to 20% for margin accounts, up from 15%. The changes are effective after the market close on July 31, according to a memo to clients reviewed by Reuters.
Investors will now need to have more cash in their accounts as collateral than previously required to make the trades, due to the volatility of Tesla's stock.
Tesla is one of the most shorted stocks on the market, with about 35.4 million shares, or nearly 28% of its float, currently shorted, according to financial analytics firm S3 Partners.
Year to date, short sellers are down $469 million even after a profitable month of July that saw shorts collectively gain $1.23 billion on a mark to market basis, Reuters reported.
Tesla shares are down another 2.65% Friday, July 27, and have fallen about 4% year to date.
Interactive Broker shares were down 1.2% Friday.