FDIC insurance for broker?

My trading fund is approaching 100k and might add another 200k if I sell my house and start trading with 300k. My understanding is for single person, the fdic insurance for normal checking bank is 250k. I am not sure same FDIC insurance covers brokerage account? Or not or anything different?

With that large sum held in your account, my concern is becoming how I do secure it?
One way is I am planning to another brokerage account or two and distribute the fund evenly.
Thanks.,

 

From what I understand, brokerage accounts are not covered by the FDIC. Your money in your brokerage has zero protection from a collapse. You'd have to ask them though, just to be sure.

 

Many brokerage firms own banks and do nightly sweep of settled cash into the FDIC bank. Nice move as then you get FDIC for your cash and SIPC for securities and unsettled cash. Both are obviously subject to the current size limits.

 

Futures accounts are not covered, other brokerage accounts are covered by SIPC...

http://www.investopedia.com/terms/s/sipc.asp

 

With the size of your account, SIPC will cover your needs. Most Brokers also carry excess SIPC. If you want more protection, you can fund your account with 1 year T-bills. SIPC takes action on securities before cash. However, depending on your trading, this can cause interest charge. With $300K, I would not split my account over two brokers. Just pick one that makes you comfortable.

Bob

 

Read this;
https://www.finra.org/investors/alerts/if-brokerage-firm-closes-its-doors
Happy trading.

 

WSJ ran a sensible overview a couple years back.

 

Aren't you the guy a few months ago that was asking about bitcoin options and trading on some sketchy bitcoin exchange?

 

Seems like a legit problem. I wouldn't really worry about that 50k disappearing nor would I think about the FDIC. If the FDIC were to ever need to step in then we would be experiencing catastrophe. At that point that 50k you're risking isn't a big deal. Not to mention the already apparent risk you're taking by leveraging everything to trade.

 

Seriously, you're essentially the guy working on replacing the containment vessel on Chernobyl worrying about getting hit by falling blue ice from a passing airplane. You're looking at the wrong risks!