The Fall of Investment Platforms - Are Investors Protected in Bankruptcy?
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- Опубликовано: 5 авг 2024
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Coffeezilla's video on Voyager: • Billion Dollar Bankrup...
00:00 - Intro
01:29 - Chapter 7 Bankruptcy
03:26 - Chapter 11 Bankruptcy
04:21 - Impact on Investors
05:56 - Protections for Pensions, Brokers and Banks
08:50 - Crypto Brokers
10:00 - Legal Shenanigans (Voyager)
12:02 - Closing Remarks
Crypto platforms are starting to file for bankruptcy, and investors want to know if their funds are safe. We'll dive into what protections exist, and which ones don't, in today's video.
If you'd like to support the channel, you can do so at / theplainbagel :)
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This channel is for education purposes only and does not constitute financial advice - Richard is not responsible for investment actions taken by viewers. Please seek out a registered advisor if you require assistance (while Richard is a registered portfolio manager at WDS Investment Management, he does not provide advice through The Plain Bagel, which is not affiliated with his employer).
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Already liquidated all my stock and crypto positions and withdrew my money. Thanks for the heads up.
The new format is as good as the old, cause you are still as good at explaining as you were. A good impressive format is awesome and will make your audience grow, but we stay cause of you. Everyone of your videos is as plain and simple as a bagel when it comes to understand financial things.
Hahaha woo! Crypto investors are suckers!
Bagel can you make a video explaining what happens to my subscription if your channel goes bankrupt?
Liquidated
That's impossible. Plain Bagel is in good hands! 😂
Impossible, too big to fail
It goes under small clam court jurisdiction.
In case of bankruptcy, subscribers will remain subscribed through the process and be compensated with one 20-min apology video that starts with me walking on camera and sighing.
What's hilarious is that none of this is new - the cyrpto "industry" has been rediscovering what "systemic financial risk" is and why the banking/finance industry has so many regulations in the first place
Great video as always Bagel
If crypto gets heavily regulated it's losing a major justification for its existence. Any regulation would be enforced by a central authority in the supposedly decentralized crypto
@@tomlxyz well that's why many people think it's bad
Lesson learned, don't buy crypto, invest in companies leveraging the technology to improve and lower transaction costs, for example Signature Bank.
It is said crypto is speedrunning (bad) finance.
Most of these crypto bankers just wanted their own personal money printers...
I had no idea crypto brokerages are going bankrupt. Thanks for covering this!
“Freedom and deregulation sound amazing until you no longer have the regulatory safety net and are only free to fall into the abyss”
Isn't it funny how the entities that shit the bed (3ac, celsius, voyager) are all centralized, and obviously mismanaged companies, where as the really deregulated and decentralized protocols (aave, uniswap, compound, maker) are all working without s single issue. Just shows the power of defi tbh
I work in banking and the amount of complaining about Dodd-Frank, MIFID, etc. is constant and loud....and every few years the same people that complain about regulations start complaining about not having enough regulation is screwing their securities/debt/etc because the risk assessment they were using is now completely inaccurate because of deregulation. It's a nice little "circle of life" situation that NOBODY ever learns from.
Regulations sound great until an angry mob storms your government buildings and forces you to flee, just ask the president of Sri Lanka. Or you have one baby formula factory because the FDA regulations are so steep a new start up is extraordinarily expensive and cost prohibitive. Or gasoline is 5$ a gallon but refineries are at full capacity because it’s too expense to build new ones etc etc
It’s like everything else, total deregulation isn’t good and heavy regulations aren’t good either. The big debate is finding the right balance.
@@Crf-nr9jy lol, yeah the situation in Sri Lanka is about regulation and not government corruption, mismanagement, and greed... let's all use Sri Lanka as the new keyword against regulation just like it used to be Enron, WorldCom, etc
Yeah but if you know you’re gonna get bailed out then why not just to risky stuff with people money? You make a mistake it should be on you and not others to cover the fall
Great video, it is amazing how many "Not Financial Advisor" RUclipsrs were talking about getting 15-20 percent interest with these companies and I just thought to good to be true.
"I read them daily...upside." That was a good one! Nice light hearted humor to get the sponsorship flowing!
Thanks a lot for this information, and for telling us about this newsletter! :)
The two formats are great. I find your content both extremely interesting and useful
Commenting to say that I really like this "podcast style" video backdrop with the mic and the plain and simple sign in the background. It works well for a serious "investigative journalism"/"party pooper" discussion. I also like the green screen cyan and orange background too for tutorials. Both set styles work well for this channel. My two cents... whatever that is worth.
Thank you. As always very educational.
Fantastic video. Keep up the good work.
Glad you covered this topic Richard. Good video.
Your videos on useful information like this one are my favorites. I knew about FDIC protections but not much about SIPC. Thank you!
Nice bagel sign!
good stuffs - well done
Great video and format
3:00 There are also preferred shares, which get paid before common shares but after bonds.
This was a fantastic episode. I liked the format.
Very insightful video, great job... More beginner investors should be watching this type of content...
Great video! I learned alot. I really appreciated the part on bankruptcy (Ch7 vs Ch11) because companies like GE and Ford coming back after multiple bankruptcies often confused me.
I counted nine times in Voyager's blog claiming it's a broker. Right up until they had to file for Chapter 11 🙄 but hey Mt Gox is getting their money back after seven years so there's some hope lol
Mtgox holders will get a tiny percentage of their money back, not that great, actually.
@@sprinkle61 they'll get a tiny percentage of their Bitcoin which has done a 10x since 2015 so it could turn out alright for them.
@@williamfarrington9504 They won't be in the poor house, but there is still a lost opportunity cost, since they should have something like 5x the bitcoin they will eventually get.
@@williamfarrington9504 iirc weren't they paid out in cash due to how Japanese law handled it? i.e. the cash value of their bitcoin at the time of the bankruptcy. With what's his face getting to keep the difference.
Great video. Keep it up
Thx again
Thank you
Excellent video, thank you! Could you also explain what happens if an index ETF provider (eg Vanguard or Blackrock) goes bankrupt? I would hope that the actual shares of the companies contained within the index ETF are somehow protected?
ETFs from my understanding are built using a trust, which is a legally-distinct entity from the managing company. So if Blackrock went bankrupt, it couldn’t use those assets to pay off creditors; theoretically the stocks would be protected
Just commenting to say that I like the format!
Great video. I always appreciate how you cut through all the clutter to boil it down to the facts.
Great video
You know what's also interesting? That apps like Venmo or CashApp are also not insured by any formal institution either.
Good point! I think the main difference is that, while yes these apps can store money, they aren't offering returns (from my understanding); their core offering is the transfer of money, not the investment of cash. A lot of the risk from Celsius was tied to HOW they were using customer funds to try and pay their ridiculous promised deposit rates. I wouldn't know how Venmo uses customer money, but I would guess they keep the majority of it in shorter-term money market instruments less prone to capital impairment.
That's the difference between companies that operate under a ewallet license and companies operating with a banking license. In theory, only companies operating with a banking license have a depositor guarantee and are allowed to invest the deposited funds.
Even PayPal?
@@ThePlainBagel Venmo's user agreement specifies that the cash is FDIC insured, but only if it has been added via Direct Deposit or if the user bought crypto (???)
@@ThePlainBagel Any company holding cash or crypto can be hacked, and if the money is gone, they can't get it back.
Great video! ...even though I'm not really into crypto... but I learned options from watching your old videos.
Thanks for your fantastic videos and your moral stance on the advertising partners! Probably more of a lawyer topic, but I'd be interested to hear if there's anything related to the Artesian Builds fiasco that you could cover.
I'm cool with liquidating the company and distributing what's left but not cool with taxpayers bailing out these crypto platforms cause its crypto you should've know better. Is there any risk of that happening?
They aren't big enough for the government to care and the people losing money are average people (for the most part), not corporations, so it seems unlikely.
@@Defenestrationed I mean the wealth distribution in the space is usually worse then North Korea apparently. So I think right now they're keeping their head above water (bitcoin >20k when it should be 0 tbh) just so average people get left with the bag
Crypto bros expecting bailouts are beyond ironic -- crypto investors are so detached from reality that it's not even funny.
Governments are allowed to do whatever they vote on so technically if they vote to bail out crypto then bail out they will.
But I doubt there is much appetite to do so. There is a lot of money yes but it's a very small amount of people actually involved (they are just very very loud). Also compared to the entire bank industry it's extremely tiny. Banks are easier to bail out since ignoring them causes a lot of damage to everyone.
I'm sure though that the same people that wanted nothing to do with the government would love a government bailout though (not sarcasm).
@@JohnChoidotOrg I haven’t heard a single investor in Celsius or voyager or Celsius even mention a tax payer bail out. I think people randomly suggesting it here who know nothing about what’s happening are the ones detached from reality I’m afraid.
A minor point is that in the US, credit unions are insured through the NCUA (National Credit Union Association), which also insures deposits for up to $250K; I don't know whether Canada has more than one nation-wide deposit-insurance system.
If somebody has paid for an item or service, but not received it when the company goes bankrupt, where is that ranked in order of payment?
A quick one: I want to buy the S&P 500 index (ETF). What is better for me. A. Convert CDN$ to USD$ and buy the US index ETF on the US market. B. Buy the US index ETF, but keeping it on the Canadian side of my account ( so although I purchased US shares (ETF), it shows a fixed purchase price in CDN$ on my account. C. Buy a Canadian ETF mirroring the S&P 500 in CDN $ ( non hedged) and finally D. Buy a Canadian S&P 500 ETF (currency hedged).
What is the best option to minimize currency exchange cost? Which of the four options above is best for me as a long term investor.
Thank you.
Bagels thanking Coffee, what a great breakfast
I kinda like this movie too,its fun for what it is.
It certainly helped to have some insight to the ins and outs of financial firms and a OTC derivatives or MBS trading at first viewing.
Enron was a customer of the company I worked for in the 90's. Arthur Andersen was even our company's accountants/auditors. Nice to see America and the "free market" learned absolutely nothing. I have always wondered how much the creative book keeping of Enron and the Energy Derivatives Market influenced what we have witnessed in crypto since its official inception in 2009. I honestly remember the campaign Enron ran in the late 90's for trading on unused or "dormant" bandwidth - attempting to create a "market" for something that didn't _really_ exist.
Everyone that will learn lessons learns it by learning from what happened to other people. There will always be some people that ignores all that and goes rogue anyway.
The Smartest Guys in the Room. Phenomenal film!
They disguise these under fancy corporate jargons, mixing with high-tech terminologies. Kinda hard for the average Joes to connect the dots sadly.
Hilariously, if they'd held out another 4 years, the stupidity enron was doing would've been legal.
The plain bagel, could you please make a video about investing privately in S&M enterprises? Most investing videos on youtube are about publicly traded stocks and seldom talks about privately investing. Could you cover the basics? Pros and Cons? Limitations?as since publicly traded stocks are bound to follow certain rules and laws but privately traded don’t. And how to you even do your due diligence on private enterprises as their documents are mostly not publicly accessible. Thanks!
That was an educational outline of bankruptcy laws in NA.
Hi can you do a discussion about what happens if vanguard or black rock were to theoretical go bankrupt
Love the videos thanks!
He did in the beginning.
Simple: the etf gets liquidated and you get the money
Our financial system would collapse and you better start growing your own food. LOL
Hi not first! Great content!
Plain bagel and coffee are a great combo
Lol this came out in a great timing so people see what things should be like after ftx
Lol just a few days ago I was thinking about this EXACT video. And here we are.
I had some of my savings on Voyager, not as USD, but USDC, which was advertised as pegged 1:1 to the dollar but was giving me some interest. My biggest question is whether that will be treated as crypto, or as cash. Voyager has already said that USD deposits that were frozen will be returning to the customers in full, but I'm less certain about USDC even though it's supposed to be the same value constantly...
It's being treated as an unregistered investment
I would like to have your opinion on the current bankrun problem in China and if it could affect the market.
Interesting video. Could you also please cover the current Chinese financial crisis?
Nice analysis funny shouting out coffeezilla
What about ETF issuers? I presume they set aside client money as well?
I invested in ELMS, EV car company. I thought it was very safe and the CEO was very well respected, from what I read. The company is now bankrupted and I think that I lost my investment. I am not sure but I have less than a dollar in my brokerage account. I am hoping that someone buys them and I can get some of my money back or write it off at the end of the year. I honestly thought that EVs were the future but all EV companies were pumped back in 2021.
That happens with stocks. In 2001 I bought shares in Akklaim. A year later they were worth zero.
I think you have to differentiate between investors AND depositors/clients. Investors are VCs that capitalized these companies, depositors are those using the services of these companies, mainly in the form of their crypto deposits. Not sure, who is the more ‘senior’ one between these two classes. Creditors get paid first, but what about clients? And what about shareholders?
Clients assets are held separately and their principal must be paid in full, hence the insurance services mentioned in the video.
Shareholders are members of the company going bankrupt and therefore, just as they participated in the profits, will share any losses in proportion to their invested capital, so essentially they are among the last if not the last to get their money back.
Aside: have you considered a covered call etf video?
This was as great video especially since the recent developments put up a lot of questions on wtf is going on regarding bankruptcies. Though it does put up the question of why would places like Celsius want to go through chapter 11 instead of being treated like a brokerage. Is it due to some benefit they get or is there something they can hide so long as they can settle issues with Ch11?
I would guess it’s because they want all their staff and senior management to keep getting paid for as long as possible before they inevitably go under.
I think it was coffeezilla
but I saw someone claiming that the rules for brokerages are much stricter, brokerages don’t get to lose their customers’ money
@@thomasa5619 so the idea is that they spent the money right? If they are a normal business then it doesn't matter and they are just unsecured creditors. If they are brokerages then they are in deep trouble.
If true that's dark
I am so curious to see what happens with CoinBase through all of this as what little coin I have is in there with them. This isn't their first down-turn, they didn't get caught up in some of the insanity of the other companies... and yet I keep hearing rumors about people saying that they haven't been getting referral deposits, or that transfers take days or weeks to get their money out instead of the normal few minutes to hours that it took previously. But then again, other people are saying that things are fine and they have seen no such hang-ups. Just hard to know who to believe right now. The company itself says they are doing fine and are expanding in Europe, and looking at being more like FTX in offering stocks... but of course the company is going to say things are fine until the bitter end.
So I dunno. Its all a bit of a mess. I'm not planning to take any money out any time soon... but it has prevented me from depositing my mining efforts in there, and now I am looking at just setting up a hard or soft wallet to store my BTC into. When it comes time to liquidate into 'real money' then we will just move it through whoever is left.
Coinbase is in a lot of trouble as a business. They are laying off people and their stock has fallen 90 %+. Its unlikely they will go bankrupt, but if they do, you could definitely lose some of your coins. There is no benefit of having coins on an exchange, except that you don't have to custody them yourself, but the risks are just getting very high for these businesses in a massive bear market, so its time to get a HARDWARE wallet, and do this right.
both formats are nice but i kinda prefer the previous ones with a little bit of animation
It might be more helpful if you took an actual example ad walked people through each stage. For example the Hyundai failure and the Radio Shack failure Do not forget the Commodore voluntary liquidation.
So does one take on more risk when they have over 500k invested through one brokerage? Would it then make sense to utilize multiple brokerages for those with over 500k in assets?
I ask the same thing
Can you make a video on what happens in Canada if a broker goes bankrupt (for example: Wealthsimple) ?
Plz advise me buy stock or crypto currency or non of them in this time thank you
In the US there are different types of pensions and they have different levels of risk. A pension from a for-profit company is vastly different from a government pension. A pension from the local government and one from the state or federal level are also very different. Its highly unlikely that a pension from a local government will default but its possible as we learned from the City of Detroit. In that case, pensioners had to make concessions after the city declared bankruptcy. However, in the history of the USA a state has never declared bankruptcy and technically a state can't default on pension liabilities because the state has the ability to raise revenue through taxes. Of course, there is a limit to everything so the truth is that we have no idea what happens when a state defaults.
That said, this is a very interesting subject that is largely ignored in the financial world and you could do it justice by putting out a well researched video with examples to discuss pensions and their liabilities. It could be argued that government pensions are insolvent in the long term because politicians make promises that they can't keep and won't be held accountable many years down the road when the pension starts to run out of money to meet liabilities. Pensions are under a lot of pressure to seek investments with a high expected rate of return to meet obligations. Some people believe that pensions are a multi-trillion dollar time bomb in the USA waiting to implode. What happens if a state level pension defaults? How could a multi-trillion pension time bomb in the USA affect the rest of the economy, taxes, pensioners, and our way of life? Should we be fearful? Should pensioners also invest in a defined contribution plan?
As someone who works with state pensions as institutional investors somewhat regularly (and with access to most of their financials) I can say with confidence that none of them are going bankrupt any time soon. In the past few years they’ve made a killing, especially in the private equity space. It’s rare to see negative returns from pensions even in this market environment, and the couple that I’ve seen that are losing money are quickly changing their investment allocations to stem the losses.
Just to put some perspective on it, not every lent coin earned ponzi-like returns. Bitcoin lent earned 1 % interest over a certain amount, which is not unreasonable, even by current bank returns. The problem is, apparently absurd levels of risk were taken with those coins, to generate those tiny returns, so even though the returns seemed believable, the risks were off the chart insane, and a lot of the deposits appear to be lost :(
Burnie Madoff didnt provide ponzi like returns but still was a ponzi scheme. So whats your point?
i think this mic set up look weird and uncomfortable since you use a lot of hand movements. your content is great as alway!
I think much of the money is gone. If it's a "security" the cash paid for the coin, was traded, the remaining asset is not cash, but is deposited like cash. The units are what legally must be returned. This is how I see it, a museum borrowing a ton of painting experiences a lot of members cancelling their membership, with no money the museum is not able to share ticket revenue with artists so the artists demand their artwork. should the artwork be returned? Yes. Because no one is looking at it now. The legal case here is, can the coin species be returned instead of cash. Investors who did not read the find print maybe looking at a pile of digital dust.
What’s really interesting is that these companies own PR departments didn’t read their own fine print and straight up lied when advertising the company.
You're missing the part where the museum rented out the paintings for private clients to show off in their homes, but then suddenly the clients dont wanna give them back either- or even pay the museum off
@@Trifusion1 They knew what they were doing. They knew if it did all fell apart (which they had to know was likely with Covid and all that) they wouldn't be held accountable.
@@jonny-b4954 Lol, I dont beleive it. Scammers never tend to operate in unregulated space, and also this is the first time a scam like this has been done!
(jk)
@@Elemblue2 Haha I was like "wait... come on now" then I got to the end haha ;) But yeah.... These crooks totally knew what they were doing. I'd assume some of them truly believed they could make it work; but were definitely aware of the risks. It's wild though. This modern age is absurd in so many ways. I literally made a 35% gain on an investment today (It was only a few hundred bucks sadly) while losing on tons of solid companies that make shit, in like 30 minutes, for doing literally nothing, because a nothing "coin" is somehow being seen to raise in value when it's literally.... nothing. Hahah So, I mean, the scam is just ripe for the taking when putting yourself in these crooks shoes.
As a Voyager Customer, they still have "deposits" even though they don't work currently.... "loans" lol... freaking jerks. I'm glad 98% of my investments are in Fidelity and my pension group. I only got burned a little.
Mmmm Coffee and Bagel ;-)
Another great video! What about ETF’s? Can the fund go bankrupt? For example, I hold the iShares Core MSCI World UCITS ETF USD (Acc) - what happens if BlackRock goes under?
ETFs usually hold shares within a trust, so legally they are separate from the company that’s managing the fund. If Blackrock went bankrupt, the assets held in the trust would not be claimed by creditors. But fraud can happen even within these legal structures
@@ThePlainBagel Interesting - but where would that leave me? I hope you do a video on this topic - this is a risk I have found it hard to do research on.
Thanks for the video sir!
Tether (USDT) has lost 20B in the last 3 months. If this trend continues toward year-end, there are high probabilities of the implosion of Tether and the destruction of the whole cryptomarket (Bitcoin going below 1k, price it had before the creation of Tether).
Could you make a video with your thoughts on this?
Can you make a video on forex and there invesment protections
Does the $500K SIPC coverage limit suggest we shouldn't have move than $500K with a single brokerage like Vanguard or Fidelity? Better to spread $1M or more around to multiple brokerages?
There is an argument to spread your wealth with different institutions. Wealthy people would never trust all their money to just one institution. Why should we?
exactly this.
regarding bankruptcy payment pecking order, I think paychecks go first
Bagel can you cover the runs on banks in China?
You want risky? My largest holding is an ETN (USOI). Maybe a video on notes would be good!
Good video but the background music is very distracting. It is very audible on headsets.
I think I have maybe ten cents' worth of assets trapped with Celsius. 😄
I wish I could say that I saw the writing on the wall and got out while I could, but I collected on one of their new customer special offers, then moved on to collect a similar offer from FTX.
So if I move it off crypto exchange to my wallet then im fine?
I did not gamble in crypto as I saw it for what it is gambling. There was never anything backing it as you where just hoping that you can find an even bigger sucker to buy it at a higher value than you did.
I've already accepted that the $8K in stablecoins invested in Celsius is gone forever. However, I'm interested in FDIC insurance and FinTechs. In cases like Beam or Yotta or ONE Finance, or a Fintech ""bank"" that takes deposits and pays interest. The FinTech itself does not have insurance, but the back-end bank where the money is routed does have FDIC insurance. What happens if the FinTech goes bankrupt?
If the FDIC-insured bank goes bankrupt, FDIC will compensate depositors. If the FinTech goes bankrupt, e.g., Beam and Voyager, what happens then? The bank has the money in an insured omnibus account, but the customers can't access it because the FinTech that handled customer deposits and withdrawals is kaput.
The back-end bank is still doing fine, so the FDIC doesn't get involved, and even if it *did* fail before the FinTech firm did, that would just mean that the FinTech firm's insured deposits (up to $250K) would be safe, so that may itself lead to the insolvency of the FinTech firm if it had a lot more deposits than that.
I hope people get their money back eventually. But I can't say I'm not at least slightly pleased they're having a scare right now.
So could you open multiple accounts (with a bank or brokerage)? For example, could you open 2 brokerage accounts to allow for essentially $1,000,000 protection, as opposed to $500,000 promised with just one account?
Thats a good question.
@@richardgg2889 You think so? If it were the case then you could just open 1 account per stock, and then buy shares until you reach the 500k. But when I put it like that, it just sounds too good to be true.
It's per institution, so I would say if you open with different brokerages, then yeah, probably, but different accounts with the same broker is unlikely.
@@LiamNI Ah yes that makes sense, cheers!
THE COFFEEZILLA REFERENCE!😀
Speed running the history of finance 1840 to 1980 in record time...
Fools and money, etc...
Chapter 11 and chapter 7 appears to be for USA. I do not think we have chapter 7 and 11 in Canada. What do we have in Canada exactly?
In Canada bankruptcy tends to refer to a Chapter 7-like process. We have "proposals" that are like restructuring (i.e. Chapter 11) but aren't technically classified as bankruptcy.
@@ThePlainBagel Thanks for the reply. Another question. Do you think that there are very few price discovery in Canada compared to the USA? I do not see much price discovery in Canada and it appears to be mostly efficient.
What would you recommend for high net worth individuals that have holdings over $500K? How can you get a safeguard got those funds?
Separate your assets into multiple brokers until you are below the protection thresholds in each individual account
Buy art.
@@hey8174 what if I am not in America and don't have access to multiple brokerages? I trade in LSE and use interactive brokers, are there any alternatives that I can use?
Ok, but when a brokerage goes bankrupt do I have to sue them or will asset transfer to another brokerage happen automatically?
Asset transfer should happen automatically if the brokerages goes through the SIPA process
Great stuff (unless you have money in voyager or Celsius) There is so much speculation and misinformation about this stuff so it's great to have a pro talk it through
Let’s hope the crypto investors get some of their money back, lately it’s just oil on fire in that sector 😬
Great Video!
Why should we hope they get their money back? Most of these "investors" were stupid enough to risk in assets with little to no transparency, no regulations, oftentimes without a full or even partial understanding of the actual cryptocurrency, and have often actively used the fact that there are no regulations as a logic to invest in the asset because "its decentralized".
I dont hope that my local village idiot gets his investment back on buffalo nickels and fairy dust either. Whats the difference?
@@2639theboss Sometimes the most important lessons are painful!
@@2639theboss If they get the money back it would decrease the incentive for others to try to run such a scam
@@tomlxyz if they get their money back, the companies have no incentive to change their behavior and neither do legislators. It increases the likelihood it will happen again if they get their money.
If idiots want to buy snake oil, you cant stop them.
Nah, the ‘perks’ of crypto is that it’s deregulated and decentralised. Goodluck getting any compensation for loses
So is Robinhood done?
Did anyone else get an ad for an investing platform before this video?
Hardware wallet…. You should be good going forward
The argument that customers gave loans implies there IS money there, and the more-senior creditors want to make sure they get it.
The company which borrowed 4.59 mil USD from me just went chapter 7 last year😥😥😥
Bagel, I am in Canada and I want to invest as a student. I was wondering what type of investor protection Canadian online brokers have for regular investing (stocks)?
If you are a student my personal suggestion is focus on studies furst and keep styding stock market too.
Because stock market will divert your mind from studies
Also most probably you might not have income source too
@@shubhamgarg09 I am not a fan of day trading. Inflation is above 8% in Canada and I work on trades during the summer. I am not a fan of working NY ass off and seen it fly away. Hence, my inquiry regarding online brokers, because I already have some money invested. It will mature in about 3 months.
Use a wealth pool. Typically to get into them, you have to be a millionaire and get special acceptance. However, you can break into some with just 1k using specialized brokers. They have more or less ignored all this, and continued to appreciate by roughly 5% per year. They are designed essentially, as a safe savings account for the rich. Im no professional, thats just my 2 cents on it, and some observations. But you can also see their history.
Thats if you just looking for somewhere to put your money for a while and then go do something else.
Im a low level crypto miner, would love to answer any questions you have. I even know who satoshi was! ("was" is a clue)
No
Losing money to crypto has never happened to me. But then again, I never touched crypto
As long as Fidelity and Wells Fargo survive, I'm good. I invest in OTC, Nasdaq, (which you never would), and dividend stocks. Never crypto or NFT's.
Great video Richard. Another relevant, interesting conversation would be what happens to ETF investors when an ETF issuer goes bankrupt, or when the companies that contribute the most to an ETF go bankrupt. With ETFs becoming pretty popular, some fundamental lessons about the mechanism behind an ETF will be super useful for the everyday Joe.
ETF's are just stocks. So if you have a regular (and regulated) broker, they're covered by the standard investment rules and regulations. So regular Joe is probably safe.
@@k.h.6991 that's reassuring to know. How about the scenarios when the underlying stocks of a large ETF go down? Will it have repercussions on the balance sheet of the ETF manager, and by extension affect other ETFs managed by that same company? I would imagine since the ETF issuers have to carry out the BTS trading to keep the ETF price stable, one ETF going down may have chain consequences on other ETFs. I might be wrong, though