Cash interest rate Rakuten Securities

No, Rakuten Securities doesn't pay any interest on uninvested cash, so make sure you don't leave too much cash lying around at Rakuten Securities for too long.

My key findings in a nutshell

My key findings in a nutshell

Gyula Lencsés, CFA

Stock Market Maestro | Stock Market • Investment • Market Analysis

I’ve been a professional stock trader for more than a decade, investing into equities, ETFs and many other asset types in my capacity as a pension fund and investment fund manager. When it comes to equities, I prefer value-based fundamental long-term investment over short-term trading.

Learn about our methodology

Gyula Lencsés, CFA

Stock Market Maestro | Stock Market • Investment • Market Analysis

I've thoroughly tested Rakuten Securities services with our analyst team by opening a real-money account and these are my most important findings:

• Rakuten Securities offers no interest on your uninvested funds
• Interest on your cash can help preserve its value while you search for your next investment target
• Your cash is as safe at brokers as at most banks
• Watch out for minimum balance requirements or inactivity fees

Data updated on October 10, 2023

In times of inflation, it's usually not a good idea to keep too much cash lying around, whether in your bank account or broker account. Do you have uninvested cash in your broker account? You'll be delighted to hear that many brokers now pay significant interest on excess cash, so you don't necessarily need to withdraw and/or reinvest it.

Brokers have widely different interest rates and policies when it comes to uninvested cash. Some brokers pay nothing at all, but some brokers offer higher interest rates than banks. In such cases, it may be a good idea to deposit some money to your broker account even if you don't plan to immediately invest it.

If the interest paid by your broker is high enough, you'll feel less pressure to withdraw your money from your broker account after selling a stock; this way, you can avoid withdrawal or conversion fees. Also, if interest is high, you'll feel less of an urge to reinvest your cash right away; allowing you to patiently wait for the best opportunity to buy your next stocks.

When it comes to keeping cash in your broker account, you shouldn't be concerned about safety in most cases. For example, in the US, the Securities Investor Protection Corporation (SIPC) insurance scheme protects your cash holdings up to $250,000 in the case of broker bankruptcy. In addition, many brokers keep their clients' uninvested cash at reliable third-party banks, keeping it further out of harm's way.

Eager to seek out advice or improve your investment skills? Check out our overview of the most popular learning tools for long-term investors.

It's great to earn interest on uninvested cash in your broker account, but there are a couple of things to remember:

• Some brokers require a minimum account balance from you to qualify for interest payments; this is often relatively high ($100,000 or more).
• If you keep a broker account solely for earning interest on your excess cash, pick a broker that doesn't charge a regular account fee or an inactivity fee.

Are you in the stock market for the long term? Check out our list of the top brokers for buy-and-hold investors.