Stupid question alert: 1. Apparently, it's possible to buy stock directly from a company, bypassing a brokerage account. Is that practical? The benefit is avoiding a brokerage fraud? I know about SIPC. 2. If you buy a stock directly from a company how do you prove ownership?
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I called
@Vanguard_Group and@Vanguard_FA and spoke with two representatives (who are usually quite good!), one an entry level and someone who specialized in technical questions. Neither had heard of MF Global nor could they tell me whether customer assets in brokerage...Show this thread -
...accounts could be used as collateral in loans made by other entities.
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What happens when
@Vanguard_Group@Vanguard_FA lends its customers' securities to an entity shorting the stock and that entity goes bust? https://institutional.vanguard.com/VGApp/iip/site/institutional/researchcommentary/article/InvComVIPSSecLending&SYND=RSS&Channel=RI …pic.twitter.com/SnhWpoMORA
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I suggest you research Credit Suisse and their sudden liquidation of ETF fund
$VIIX in 2018, in an incident known as “volmagedden”. Interesting case study. It’s funny because before bank deregulation, this was why banks weren’t allowed to offer investment products post grt dep
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This is entirely why AIG was nationalized in 2008, even though the derivatives were Chinese-walled from rest of business. Derivatives have since become less effective as a product, but also less risky for banks. They will liquidate fund before it can threaten stability of whole.
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