Basis Points: Seattle is next Wednesday at Stoup Brewing in Seattle.
Schwab's client long/short book averaged $51.4 billion in margin loans in 3Q26, up from $2.8 billion a year earlier, according to its Q3 2026 results.
The revenue lines including long/short powered around 40% of the growth in Schwab's net interest revenue.
With a little back-of-the-envelope math, financing plus securities lending revenue puts long/short at a ~$1 billion/year run rate, up from essentially nothing 18 months ago.
This makes their decision to throttle long/short growth with a $10 million minimum puzzling.
One rumor was that Schwab's cost of funding may have played a role, but let's see what the numbers reveal.