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What Happens If Tastytrade Goes Bankrupt?
What happens to customer stocks and money if Tastytrade goes bankrupt? Is Tastytrade out of business?
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What Happens If Tastytrade Goes Under?
Tastytrade is a relatively new brokerage firm. If you’re concerned about the financial solidity of
this organization, and what might happen should Tastytrade go bankrupt, keep reading!
About Tastytrade
The team that started Tastytrade has been in the investment world for a long time.
Initially working as floor traders at the Chicago Board Options Exchange, Tom Sosnoff and Scott Sheridan progressed through various significant phases in their careers after their time at the exchange.
In 1999, they embarked on the creation of a highly popular trading platform called thinkorswim, which they diligently developed for the next decade before eventually selling it. Following the sale of their initial brokerage, the team established Tastytrade in 2011. This new brokerage aimed to revolutionize customer interaction with the markets, and the tools and products available today are a testament to that objective.
Presently, Tastytrade offers an exceptionally innovative options trading experience. Furthermore, the broker has introduced its own line of futures products and operates a dedicated learning network known as tastytrade.
Tastytrade Promotion
Open TastyTrade Account
What Happens if Tastytrade Goes Bankrupt?
Tastytrade is a member of FINRA and the SEC. Its FINRA CRD number is 277027, while its SEC filing
number is 8-69649 (Chicago district office).
Given that FINRA and the SEC regulate Tastytrade’s activities, and you receive SIPC insurance on
your cash and investment holdings, your money is well protected should Tastytrade go bankrupt.
Keep in mind that the maximum SIPC protection guaranteed is $500,000 (including up to $250,000 for
cash holdings). This is a per-client limit as well, not per account. You can’t simply open more
accounts with Tastytrade to gain more insurance.
In addition, Tastytrade’s clearing firm (Apex Clearing) has an additional insurance policy. This means
that, should SIPC limits be exhausted, you can count on additional protection for securities and cash,
up to $37.5 million, including up to $900,000 in cash holdings.
Tastytrade and Competitors
Final Thoughts
Private sector companies such as Tastytrade that don’t have any government funding always face the
possible risk of insolvency if they can’t cover the cost of their bills.
That said, it does not appear that Tastytrade are anywhere close to this point.
In any case, thanks to federal regulation and SIPC insurance (plus an auxiliary policy), you can count
on your investment and cash holdings being protected if held with Tastytrade.
Tastytrade Promotion
Open TastyTrade Account
Updated on 1/5/2024.
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