02-02-2018, 07:00 PM
(02-02-2018, 02:19 PM)Kerim Wrote:(02-02-2018, 01:13 PM)Caversham Wrote: I'm hesitant to move money into this account as I would probably be hitting SIPC limits within a ~5 years.
Surely the big firms have figured a way around this? Hard to imagine they'd just sit by and watch every client with more than $500k take the excess elsewhere?
I believe most brokerages have extra insurance in addition to SIPC.
However, my concerns are larger than just SIPC. Primarily, a single broker means a single point of failure. What if there is another financial collapse and the company providing that extra insurance goes bankrupt and can't pay? What if there is an asset run and my single broker freezes all asset withdrawals for a prolonged period of time? etc.
Those concerns might be a little tin-foil hatty, but it makes sense to me to diversify brokerages for the same reason we diversify stock holdings.