The headline rate is a lie that tells the truth about someone else's balance.

Margin ads show one number. The lowest margin rates broker in the headline is rarely the lowest for your balance, because margin is priced in tiers and almost nobody reads the tier table. Here is how it works. A broker advertises 8% and you assume you pay 8%. But the schedule says 8% applies above $500,000, 9% above $100,000, 10.5% below that. Borrow $25,000 and you are paying the bottom tier rate. The broker ranked two spots lower with a flat 9.5% is actually cheaper for you. The headline lied. Truthfully, but about someone else.

Interactive Brokers tiered margin rates are the famous example. Their published tiers undercut most of the industry at higher balances, which is why active traders swear by them. At small balances the edge shrinks. That is not a knock, it is just math. And it is exactly why tier-by-tier comparison beats any single advertised number.

Also remember: margin interest accrues daily and compounds. A two-point rate difference on a $50,000 balance is $1,000 a year. That is not a rounding error. That is a vacation.

One more wrinkle most people miss. Some brokers negotiate. Carry a large margin balance, call, ask for a better rate. Especially at full-service firms. The published schedule is the opening bid, not always the final price. It never hurts to ask.

If you are hunting the best broker for day trading, tiers matter even more, because active traders borrow more often. Do not trust broker reviews that quote a single rate. Use a brokerage comparison database search tool and price your actual balance across brokers before you commit. BrokerCompare lines up margin tiers for 50 US brokers. Start at brokercompare.fyi.