Reply
Page 8 of 8 FirstFirst ... 5 6 7 8
Like Tree46Likes

Stock broker for US stocks - what if they go bankrupt? HK laws?

  1. #71

    Join Date
    Feb 2015
    Location
    Hong-Kong
    Posts
    5,095
    Quote Originally Posted by foxwendal
    @jrkob, do you trade/keep LSE shares with them? if so, do you know what is charged on custody? thanks
    I do not.

  2. #72

    Join Date
    Feb 2015
    Location
    Hong-Kong
    Posts
    5,095

    In HK, investors, including retail investors, can open a custody account with the exchange directly (HKEx), and it is extremely cheap. This removes the risk on the custodian completely.
    Perhaps the LSE allows something similar, I haven't checked.

    Last edited by jrkob; 11-04-2019 at 03:03 PM.
    foxwendal likes this.

  3. #73

    Join Date
    Feb 2015
    Location
    Hong-Kong
    Posts
    5,095

    @foxwendal, well I didn't go very far with BEA and the stock codes, they want me to come to a branch to meet with an RM. I don't have time for this nonsense.


  4. #74

    Join Date
    Dec 2009
    Posts
    78

    they took over a week to get back to me on the ones I asked too. at least you're cutting your losses early.


  5. #75

    Join Date
    Jun 2013
    Posts
    99
    Quote Originally Posted by tck
    I guess I have taken the solvency of the brokers for granted. Is this really a real risk? I have a fair amount of my equity portfolio in IB, well above any sort of guaranteed amounts. Is there a % of equities held in a single institution that would be too much?

    I'd say a third of my net worth might be in equities held by IB, a third in HSBC a 5th citi, and the rest here and there.
    What meaningless post. I can't see any purpose to it besides humblebragging.

  6. #76
    tck
    tck is offline

    Join Date
    Jul 2015
    Posts
    94

    @HKthe, the first reply to this thread said that the protection if HK Interacrtive Brokers goes bankrupt goes only up to 150k. If you consider that a humble brag then whatever.

    I've pretty much pumped all my savings into my brokerage forever so of course I'm worried with a disproportionate amount of net worth held in equities.

    I'm just asking if people are mitigating counter-party risk by spreading out across different banks / brokerage. I was of the mind of having most of my savings in equities and it just ended up that it all flowed to the lowest cost brokerage I could find.

    jrkob, Drunken Master and Gevening like this.

  7. #77

    Join Date
    May 2019
    Posts
    33

    Not if it was this discussion or another where someone was asking about Ameritrade and Charles Schwab. I emailed the SIPC below and got this response:

    SIPC protection extends only to cash and securities held in a customer securities account at a SIPC-member securities broker-dealer placed in liquidation under the Securities Investor Protection Act (“SIPA”). Charles Schwab, Hong Kong, Ltd. (“CSHK”) and TD Ameritrade Hong Kong (“TDHK”) are not SIPC members, but clear, respectively, through Charles Schwab & Co. (“CSC”) and TD Ameritrade Clearing, Inc. (“TD Clearing”), which are SIPC members. Accordingly, SIPC protection would be available with respect to cash and securities held in customer accounts introduced by CSHK to CSC, or by TDHK to TD Clearing, only if CSC or TD Clearing, respectively, were to be placed in liquidation under SIPA.

    pin and Drunken Master like this.

  8. #78

    Join Date
    Oct 2006
    Location
    Hong Kong
    Posts
    13,275
    Quote Originally Posted by rob86craig
    Not if it was this discussion or another where someone was asking about Ameritrade and Charles Schwab. I emailed the SIPC below and got this response:

    SIPC protection extends only to cash and securities held in a customer securities account at a SIPC-member securities broker-dealer placed in liquidation under the Securities Investor Protection Act (“SIPA”). Charles Schwab, Hong Kong, Ltd. (“CSHK”) and TD Ameritrade Hong Kong (“TDHK”) are not SIPC members, but clear, respectively, through Charles Schwab & Co. (“CSC”) and TD Ameritrade Clearing, Inc. (“TD Clearing”), which are SIPC members. Accordingly, SIPC protection would be available with respect to cash and securities held in customer accounts introduced by CSHK to CSC, or by TDHK to TD Clearing, only if CSC or TD Clearing, respectively, were to be placed in liquidation under SIPA.
    Thanks for that. Wonder if the same would apply for IB? Basically I reckon all of these US based brokerages in HK operate the same way (i.e. via a local HK sub which uses their US parent as the clearing house).

  9. #79

    Join Date
    May 2019
    Posts
    33
    Quote Originally Posted by pin
    Thanks for that. Wonder if the same would apply for IB? Basically I reckon all of these US based brokerages in HK operate the same way (i.e. via a local HK sub which uses their US parent as the clearing house).
    I followed up with them actually, as I felt they were being slightly vague in terms of what might happen if the HK company had a liquidation event, but the US clearing house remained stable. I got the following response:

    If CSC/TD Clearing are in full compliance with the law, including the laws governing the custody of customer assets, then you’re account assets would remain safe. In a domestic situation of this kind, upon failure of an introducing broker, the failed broker’s clearing correspondent generally notifies customers of the failure and indicates that, as of a specified date, absent contrary direction from a customer, it will assign that customer’s accounts to another introducing broker for whom the clearing broker provides clearing services. It is likely that a similar procedure would be followed in the scenario that you describe.

    I was satisfied with the two responses, and have decided to open an Ameritrade account off the back of the information (armed with the info posted elsewhere, about dividend WHT and estate tax, I can hopefully make some sensible investments).
    pin and Gevening like this.

Reply
Page 8 of 8 FirstFirst ... 5 6 7 8