I am reading on article:
Holding stock in a street name is an accepted practice, but you shouldn't keep a huge portion of your net worth in a brokerage account using this method, especially if your account value exceeds the SIPC insurance limits.
I am not convinced that this text is not misleading. These shares held by the stock broker on behalf of the client should not be used to repay the stock brokers's obligations to creditors in the event of bankruptcy. It does not make sense for the legislators to write a law that would say otherwise, it would be absurd.
The article is US-centric (because it mentions SPIC).
What are the risks of holding shares in a street name in US and other countries?
In some cases (when holding shares in a street name) the wrong withholding tax rate on dividends can be applied (I know about online stock brokers that apply 30% tax rate instead of the lower rate i.e. 10% or 15% for US dividends according to the double taxation treaty.)
In other cases (when holding shares in a street name) a correct withholding tax rate on dividends is applied.
Submitted June 11, 2021 at 05:57AM by vstoykov https://ift.tt/3vo8lAt
