Recommended Free Tools
Charles Schwab (SCHW), Interactive Brokers Group (IBKR) and Robinhood Markets (HOOD) all have business exposure to interest rates—but none is a simple bet that higher Treasury yields will lift its stock. Their interest revenue depends on which rates move, how quickly assets and funding costs reprice, and what customers do with cash. Company filings describe those business exposures; they do not promise a particular share-price response.
What does it mean for a brokerage stock to be tied to Treasury yields?
Brokerages can earn interest on customer cash, margin loans, securities lending and other assets. They may also pay interest to customers or incur costs to borrow money. When rates change, the income effect depends on how quickly those assets and liabilities reprice, their size, and whether customers move cash to other investments.
“Treasury yields” is not one rate. A change in a particular Treasury maturity is not interchangeable with a change in the federal funds rate, a broker’s customer cash rate or its own borrowing costs. The company disclosures discussed here primarily describe short-term benchmarks, floating-rate assets or hypothetical parallel rate changes. They do not establish that a move in any one Treasury yield will produce a matching change in brokerage revenue.
How the three companies’ rate exposure differs
Charles Schwab (SCHW)
Schwab’s 2025 annual report says net interest revenue depends on the mix of interest-earning assets and interest-bearing liabilities, the spreads earned and paid, when rates reset, and the spread between short- and long-term rates. Higher short-term rates can improve yields on shorter-duration earning assets. But if rates rise rapidly, clients may shift cash from sweep products into higher-yielding investments or money-market funds. That can reduce Schwab’s on-balance-sheet earning assets or lead it to seek replacement funding that costs more.
Windows Errors? Fix Them Before They Spread
Repair common Windows errors and clear accumulated junk for a smoother, more stable PC - no reinstall needed.Free scan · no reinstallCrashes, No Sound, or Screen Glitches?
Random freezes, missing sound and display glitches usually trace back to one bad driver. Find and replace yours safely.Free scan · under a minute#1 Best Overall
Schwab reported $11.90 trillion in client assets and 38.5 million active brokerage accounts at December 31, 2025, according to its 2025 annual report. Those figures indicate the scale of its business, not how much of its revenue will change with rates.
Schwab’s second-quarter 2026 filing reported that net interest revenue rose $535 million, or 19%, in the quarter and $973 million, or 18%, in the first six months compared with the corresponding 2025 periods. The company attributed the increases primarily to growth in margin and bank lending, lower average wholesale borrowings, and lower yields on most funding sources. Those factors more than offset lower floating-asset yields associated with lower market rates and lower balances in some securities and segregated cash. The result illustrates that net interest revenue can increase even when some market rates fall.
Rank #2
- Comes with secure packaging
- Easy to read text
- It can be a gift option
Interactive Brokers Group (IBKR)
Interactive Brokers’ 2025 Form 10-K says lower U.S. benchmark rates reduce interest earned on segregated cash, invested mainly in short-term U.S. government securities and related instruments, and limit interest income from margin loans. Its net interest income nevertheless rose 13% in 2025 to $3.563 billion. The company attributed the increase to higher average margin loans and customer credit balances and stronger securities-lending activity, partly offset by lower benchmark rates.
Robinhood Markets (HOOD)
Robinhood’s 2025 Form 10-K describes interest revenue from margin loans, segregated cash and securities, corporate cash and investments, cash sweep, credit-card balances, and securities lending. It said lower short-term rates had reduced revenue from corporate cash and investments and that future Federal Reserve cuts could negatively affect net interest revenue. For much of its cash-sweep program, Robinhood says it manages the spread in part by adjusting the rate offered to users as partner-bank rates change.
Do these 3 things before closing this tab:
1Scan for outdated or missing drivers - takes under a minute2Repair Windows errors before they cause bigger problems3Fix the driver behind crashes, sound loss and screen glitchesFor the quarter ended June 30, 2026, Robinhood reported net interest revenue of $389 million, up 9% year over year. The components moved in different directions: margin interest was $215 million, up 89%; interest on cash sweep was $41 million, down 32%; interest on corporate cash and investments was $31 million, down 33%; and net securities-lending revenue was $10 million, down 81%. Robinhood said the overall increase primarily reflected higher margin interest and net credit-card interest, partly offset by declines in securities lending, cash sweep and corporate cash revenue. These are company-reported quarterly figures, not a measure of how the business would respond to a uniform Treasury-yield change.
What do the companies’ rate-sensitivity estimates show?
The disclosed estimates use different rate shocks, balance dates and financial measures. They are not directly comparable and should not be used to rank the companies.
Rank #4
| Company | Disclosed sensitivity | What the estimate measures and assumes |
|---|---|---|
| Charles Schwab | Not stated in the cited 2025 annual report and second-quarter 2026 filing excerpt. | The cited disclosures explain drivers of net interest revenue but do not provide a comparable modeled rate-shock estimate. |
| Interactive Brokers | A 0.25-percentage-point increase in U.S. dollar rates was estimated to add $77 million to annualized net interest income. | Interactive Brokers’ 2025 estimate uses customer balances and investments at December 31, 2025, and assumes maturing instruments are reinvested in short-duration instruments. The company separately estimated a $30 million annualized increase for a 0.25-point rise in relevant non-U.S.-dollar benchmark rates. |
| Robinhood | A hypothetical 100-basis-point rate change was estimated to change pre-tax total net revenues, net income and cash flows by $350 million. | Robinhood’s second-quarter 2026 estimate applies the modeled shock to June 30, 2026 balances. It excludes cash-sweep balances from short-term rate sensitivity because the company says it can adjust user rates for most of that program. Actual effects may differ as balances, timing, rates, market conditions and management actions change. |
The figures describe modeled operating exposure, not forecasts of annual results or stock returns. Schwab’s cited filings do not supply a matching sensitivity figure, and the measures in the IBKR and Robinhood models differ.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.How should investors interpret the rate connection?
- Check which rate the company actually discusses. A filing’s reference to short-term benchmarks, floating-rate assets or policy rates does not automatically establish sensitivity to a specific Treasury maturity.
- Look at customer cash and funding costs. Higher asset yields may be offset if customers move sweep balances or the company must replace deposits or other funding at higher cost.
- Separate interest revenue from the rest of the business. Trading, lending balances, securities lending, expenses and customer activity can change results independently of rates. Robinhood’s second-quarter 2026 figures show that its interest-revenue components did not all move in the same direction.
- Read sensitivity estimates with their assumptions attached. A modeled change for one set of balances and one rate shock is not an apples-to-apples comparison with a different company’s model.
- Do not treat operating sensitivity as a share-price forecast. The filings describe business exposures, not guaranteed market returns. Valuation, expectations, trading activity, client growth, expenses and broader market conditions also affect a stock.
Robinhood summarized the uncertainty in its Form 10-Q for the quarter ended June 30, 2026: “We are directly and indirectly exposed to fluctuations in interest rates, and rapidly changing interest rate environments have in the past and could in the future reduce our net interest revenues and otherwise result in reduced profitability.”
Quick Recap
Best Value
Product prices and availability are accurate as of the date/time indicated and are subject to change. Any price and availability information displayed on Amazon at the time of purchase will apply.
