I was charged a ridiculous overnight short fee

I shorted ASLN at $5.50 and covered the next day at 2.70 for a $484 profit only to find out Tradezero charged me an overnight short fee of $564. This is absolutely ridiculous.

Their pricing rules looks like this.
Hard to Borrow Overnight Shorts 7x market rate cost for 1st night, additional days charged at 1x market rate

I don't even know what that means. Someone help me understand please...

 

Please clarify that you only shorted 100 shares. Was it 200 shares or some other number?

 

I shorted 180 shares.

 

where does the 7x market rate come from?

 

From their website. At least they have always been honest about it. But is is not a healthy business model. Who in their right mind would continue to use them as a broker when they find out that they pay 7 times for day 1, if they missed the information on their website before opening an account.

 

What I miss in general is a study comparing short borrow rates among brokers. I checked the Bloomberg terminal. It does not carry this data. Of course I could simply open accounts across the board. However, being situated in the EU prevents that.

 

Yeah it's extortion. Beware of this broker. If you shorted 10,000 shares and held it overnight you might end up with fees in the hundreds of thousands.

 

Was this over the weekend as well?

 

In that case it would only be 7 times for the first day, I assume. That is 7 times for Friday overnight and 1 times regular rate for Saturday and Sunday overnights.

However, what is meant by "regular rate" is also a shaky concept, I guess, as I assume that is up to the broker to decide.

 

Nope, it was just one day.
The rate was 0.275.
I've no idea how that is even calculated.

So 200 sharesx0.275x7?
Just a guess.