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What protection does SIPC offer US stock market investors?

The Securities Investor Protection Commission (SIPC) is an organisation in the U.S. that guarantees assets (cash and shares) held with a stockbroker, or as they tend to call them, a broker-dealer. Members of SIPC are able to provide their customers with a guarantee of up to $500,000 (max. cash component of $250,000) in the event of a failure of the broker-dealer.

When you deal in U.S. securities make sure that your broker is a member of SIPC.

Capital 19’s broker-dealer partner is a member of SIPC so that all Capital 19 customers are entitled to this cover. In addition, there’s an insurance policy in place with Lloyds of London that increases this cover to up to $900,000 in cash and a total of $30,000,000 for any single claim if the SIPC cover is not enough.

You can learn more about SIPS on their website


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This is an excerpt from the book ‘An Australian’s Guide To Investing In U.S. Stocks‘ by Matthew Jones.

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