What if the Third Party Broker fails?
In the US, if a brokerage firm ceases to operate, the assets of their clients are normally transferred in an orderly manner to another registered brokerage firm. In addition, the Third Party Broker is required to keep their clients’ securities and money separate from their own so that even if the Third Party Broker fails, their clients' assets are safe. Brokers are also required to meet minimum net capital requirements to reduce the likelihood of insolvency and to be a member of the Securities Investor Protection Corporation, which protects client securities accounts of up to US$500,000.
Introduction to stock trading
- What is a stock?
- Where do stocks come from?
- What is stock ownership?
- Why do people buy stocks?
- How could you lose money from buying stocks?
- What are stock markets?
- What is a stock broker?
- What is a stock price?
- What is a bid-offer spread?
- What are stock charts?
- What is commission?
- What are bullish vs bearish markets?
- What is technical analysis?
- What is fundamental analysis?
- What are analyst recommendations?
- What are stock financials?
- What is EPS (earnings per share)?
- What is a P/E ratio (Price-to-Earnings)?
- What is a P/CF ratio (Price-to-Cashflow)?
- What is ROE (Return on Equity)?
- What is Market Sentiment?
- What are Market Sentiment Indicators?
- What is the VIX?
- How does News and Social Media impact stocks?