I'm not going to discuss our average balances but the answer is plenty and as I said, once you take into account the difference in other charges, most agree it's a fair deal. On the futures side of the equation, there are many brokers who don't even offer interest (that's the norm in Asia, not sure about the states though). On your ACH comment, the first ACH withdrawal each month is free. After that we charge a whopping $1 which just happens to be our cost. JimR, I agree with you but you aren't going to get anywhere, I think we all made our points and if possible, let bring the thread back on topic. thanks.
I find it amazing that it takes only one nut job to derail a thread on ET... Now... Back to: broker solvency in market crash
Looks like one individual thinker versus numerous nut jobs, aka herbivores -- the thread topic hardly matters; most will be dead in a year. Disgusting!
jimR- IMHO, a website is purely an advertising medium for most companies. Some terms which have very specific legal meaning are used incorrectly on many sites. I remain firm in my opinion, that if you have serious concerns, you need to talk to a securities lawyer. Dont forget the brokers/employees of any firm have a fiduciary responsibility to the firm, not the customers. You can also buy a D&B report on virtually any firm, which will give you some insight as well. A very basic rule, is that you can only have one master, so, look to see who pays the persons bills, and that will be who the employee has his/her allegiance to. My own rule is that if I wouldnt lend a firm my own money, I dont open an account there.
This is a very important principle which I have been trying to recommend to all the newbies eagerly lining up to throw away their money. Thanks for the rest of your post as well.
broker solvency is not necessarily limited to a market crash but could result from a market meltup if a brokerage firm is on the wrong side of proprietary positions. broker solvency is a real issue if the settlement system between brokerage firms fails because contra parties fail to meet their obligations. the possibility of a domino effect definitely exists. sipc cannot be depended on because your positions can be frozen for long periods of time.
I think you may mean third party risk - where, another customer blows up on a massive scale, and impacts the broker. Yeah, thats an issue too. I prefer to pay for a brokers balance sheet and strong controls, which I know is a pain, but its easy to lose your own money, I dont need someone else to do it for me.
It's not just your broker that you should be concerned with regarding an equities account in the event of a crash. It's the clearing firm. The broker banks the money and brokers the trade. The clearing firm undertakes risk and back office processes the trades. Thier risk exposure is something you should investigate. The Investor protection is practically worthless, becuase few people have been able to actually collect versus the number that have had legitimate claims.