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Etrade Canada

post #1 of 73
Thread Starter 
Etrade is tanking today and they have mentioned on BNN that Etrade could be a possible candidate for bankruptcy.

I have already put in a transfer to transfer equities and funds so anyone using Etrade should think about doing something. Better off loose money in a transfer where you can't access equities over loosing it all in a bankruptcy.
post #2 of 73
How could they take your equities if the company went bankrupt? I would think that my stock was safe regardless if they went bankrupt or not.
post #3 of 73
Thread Starter 
You are more than welcome to find out. I just posted as I have moved everything and 2 of my friends that use Etrade have now put in for transfers too. If everyone I know is moving out of there I am sure we aren't the only ones moving things.. That by itself is going to cause more problems.

Leave your stuff in and let us know how you make out. Personally, I would rather not.
post #4 of 73
I really have to question the competency of their management to ride the company so far into the ground like this.

TZ
post #5 of 73
Journeyman98, yes, your stock is safe but you may or may not have problem to buy or sell your stock during the bankrupcy procedure depending on the situation.
post #6 of 73
Thread Starter 
I agree TZ but this mess coming from the US is going to take down more than people suspect. Right now I would stay with a Canadian bank. They are backed by the government so we know they aren't going anywhere... Good article last week by Jim Sinclair that warned to move money out of these kind of institutions.

http://www.jsmineset.com/ARhome.asp?...ighstr=&UArts=

Despite this, the clear majority of you are whistling Dixie as Rome burns. How in the world can you be so complacent?

1. Take delivery of your share investments as paper certificates.
2. Exit all Internet financial entities. You can always go back.
3. Do not warehouse your bullion coins at unregulated coin dealers. Demand prompt delivery.
4. For peace of mind reduce, if not eliminate, all debt.
5. As far as possible reduce if not eliminate fiduciaries and/or agents between yourself and your assets.
6. Will the next shut down of redemptions be your annuities? Examine the portfolio that the annuity holds asking the question “do these positions fit the present financial conditions?” If they do not then redeem your annuity and place the Funds in Swiss and Cando short term Federal Treasury bills.
7. Be very careful of your local banks. Cash in CDs regardless of interest rate penalties. Go the Cando and Swiss T Bill route.
8. Who owes you money? Take less for immediate repayment.
9. Keep some cash at home.
10. 45% in gold insures the whole.

Do some of the above, please. I care even if you do not via no action!!
post #7 of 73
Thread Starter 
Quote:
Originally Posted by operator View Post
Journeyman98, yes, your stock is safe but you may or may not have problem to buy or sell your stock during the bankrupcy procedure depending on the situation.
Not neccessarily operator as they would use what they have on deposit by us to invest themselves.. You may not even get your equities back depending on how the bankruptcy goes.. I would rather have them tied up now in a transfer for a few days over tied up in a bankruptcy that could go on for months.. but its your choice...
post #8 of 73
I can understand the concern.

Citigroup pegs them at a 15% chance of going into bankruptcy protection. Which is not a good sign for sure but on the bright side, what an opportunity to pick up some cheap eTrade shares! (too soon? *kiddin*)

I'm with eTrade Canada, and I think I'll stick around for now and not take the account transfer hit.

Worse comes to worse, I'll just have to go through the steps to make a CIPF claim:

""" E*TRADE Canada Securities Corporation is a member of the Canadian Investor Protection Fund (CIPF), which protects client accounts in the unlikely event of financial failure. Under CIPF coverage, if a Canadian broker fails, CIPF funds are available to clients to make up for any shortfall in client assets that should have been maintained for the client up to C$1,000,000 for losses related to cash and securities balances in the client's general accounts or separate accounts as defined by the CIPF policy. An explanatory brochure regarding CIPF coverage is available upon request or www.cipf.ca.

In addition, through our relationship with Penson Financial Services Canada Inc. as our carrying broker, E*TRADE Canada's client securities may be protected by an excess securities insurance policy from Lloyd's of London. This excess coverage may protect clients from net equity losses in client securities in excess of the CIPF limits up to a maximum of C$9,000,000 per client per separate account as determined by CIPF, subject to certain maximum aggregate insurance coverage limits applicable to Penson Financial Services Canada Inc. Details are available on request """
post #9 of 73
Even at a 30% chance of going under this is a compelling loto ticket at this point.
post #10 of 73
Whoa catch the falling knife ticket - could be some more downside here.
post #11 of 73
Quote:
Originally Posted by Journeyman98 View Post
How could they take your equities if the company went bankrupt? I would think that my stock was safe regardless if they went bankrupt or not.
You own shares of a various public companies - that's has nothing to do with Etrade's liquidity.

This is just my theory - I don't have a Masters in business and economics but... I'm going out on a limb here and suggest that Etrade is simply a company and therefore can go bankrupt. I think what most people are a afraid of is having access to their equities tied up [unaccessible] for a prolonged period of time while the trustee figures everything out. You bought your equities through THEM so how could you sell them through someone else, unless they get transferred over. If it's only bankruptcy protection, things get frozen for a period of time and then things start up again. What that period of time is depends on the trustee and the government. If it's outright bankruptcy, then I'M GUESSING a transfer will take place on your behalf and probably to one of either RBC, BMO, ScotiaBank, TD Waterhouse or CIBC.

I trade with CIBC which is a chartered Bank within Canada and therefore has many more [mandated] rules to follow with regard to operating within a reasonable amount of risk, especially when it comes to their clients holdings. That may or may not be why I'm paying so freakin' much commission, at least that's what CIBC tells me (hehe). Today, I'm glad I do... tomorrow I'll start complaining again.

Again these are just my opinions in what I know about business.
post #12 of 73
I know this post was about Etrade US and not Etrade Canada but if one goes they both go. Two Hoots is a well respected poster on the IV board where I found this post of his. I have to agree with him. If you leave, where do you go? These brokerages are all doing pretty much the same thing and will all feel a certain amount of pain. Just my two cents.



"I am in the same situation. I have been considering the question since back in July when ETFC and the rest of the financials started stlling off.

If I leave E*Trade, where do I go? The entire global financial system appears to be in trouble or at least under severe pressure. It would be just blind luck if I didn't jump out of the pan and into the fire. Besides, it is a little late to change foxholes after the shooting starts. For me the decision was made in August and I'll stick with it unless something obviously better becomes apparent. Any ideas would be appreciated.

My GUESS is that E*Trade will have to take an accounting balance sheet write-off (maybe something around $650 million) and will recover most of the write-downs over time. Their actual losses in the long run will probably be less than $100 million. Let me emphasize - these are just GUESSES on my part. I don't know anything that isn't public.

I had loans and deposits at a large bank that went bankrupt in the 80s. It went through five ownership changes in the following couple of years. As a practical matter for me as a customer, nothing changed except the names on the checks in and out. If worst comes to worst, I suspect the same will be true for E*Trade.

Cordially,
TwoHoot"
post #13 of 73
Thanks for digging up that info Marty.

So with the CIPF protection it would make more sense to not transfer as far as I can tell, because at worst there would be some minor delay in accessing the full funds, but it would all be guaranteed though. And that's only if a bankruptcy occurs anyway.

If this was in the US I might be a little more concerned than I am now.

TZ
post #14 of 73
Thread Starter 
I am listening to BNN and if you have over $100k you won't get your money back if they go under. People are liquidating really fast right now so all you that want to hold on and wait to get the insurance are like I said before.. you are more than welcome but I have seen this before... good luck to you all but I would rather pay the fees now and get my money than not have anything to pay fees on.
post #15 of 73
Some firms , like Disnat for instance, pay for the transfer fees when you switch over. You have to wait a while to be reimbursed but they also offer some free trades , so its a win- win situation. I used to use Etrade but was unhappy with the service, and switched to Desjardins. I also trade thru my bank TD.
post #16 of 73
Quote:
Originally Posted by calgarylady View Post
I am listening to BNN and if you have over $100k you won't get your money back if they go under. People are liquidating really fast right now so all you that want to hold on and wait to get the insurance are like I said before.. more than welcome but I have seen this before... good luck to you all but I would rather pay the fees now and get my money than not have anything to pay fees on.
I have under $100k, but regardless, the CIPF protects up to a million across all accounts.

I don't know why BNN is saying you won't get more over $100k, but I'm inclined to believe the CIPF over BNN, it's their policy after all:

http://www.cipf.ca/c_explore_coverage.htm

BNN is usually a good source for these things so I'm really perplexed here...

Anyhow, not my worry, in both cases I'm covered.



The biggest damage to come of this, by far, is everyone panic closing their accounts. If anything puts eTrade under it's their own user base because Citigroup can't help but drag down other institutions with them. (*not flame bate, I swear!*)
post #17 of 73
I think people confuse about the protection between cash and stock. Your saving is covered by CDIC for up to $100,000. Your stock is safe but you MAY or MAY NOT have problem to trade the stock depending on the situation. The company cannot sell your stock to cover its expense (of couse, it can do it illegally, but it is another matter). It doesn't matter it is saving or stock, it will take some time for things to settle down before you can get them back later.
post #18 of 73
I think what BNN must have meant is that ETrade would only reimburse 100k, but then CIPF would cover the rest anyway - that's why it exists.

TZ
post #19 of 73
Quote:
Originally Posted by operator View Post
I think people confuse about the protection between cash and stock. Your saving is covered by CDIC for up to $100,000. Your stock is safe but you MAY or MAY NOT have problem to trade the stock depending on the situation. The company cannot sell your stock to cover its expense (of couse, it can do it illegally, but it is another matter). It doesn't matter it is saving or stock, it will take some time for things to settle down before you can get them back later.
I think you're getting CIPF confused with CIDC.

Etrade Canada is not a retail bank and does not work with the CIDC.

The CIPF, however, is partnered with Etrade Canada and the CIPF will cover up to $1million in lost assets (cash) or securities due to any failure on Etrade Canada's part.

On top of that, well over a million that is, Etrade Canada is also backed by a 3rd party insurance firm for up to $9million. Of course, I don't have such a large account to be able to pull up eligibility.
post #20 of 73
dont let it get to the point of a loss because you didnt move your stuff. You may be insured but you only hurt the tax payers in the end
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