Safe to use Merrill Edge account?

Discussion in 'Learn how to trade or invest by asking questions' started by kthx, Dec 4, 2011.

  1. kthx

    kthx New Member

    Hi everyone,

    Quick question: is it safe for me to maintain an investing account with Merrill Edge (which is owned by Bank of America).

    For that matter I also have checking account with them, but I know that it is insured by FDIC.

    I know there SIPC for investors too, but I am still a little nervous :embarassed:
     
  2. John Bradford

    John Bradford Member

    I expect the account is insured by SIPC rather than FDIC. FDIC is for deposits in savings accounts and CDs.

    SIPC only covers the cash lying around in the account. If you have your account fully invested, then your funds are actually "elsewhere".

    If you have a bank CD through a brokerage, that CD will be covered by FDIC and the bank that gave you the CD.

    I expect it's fine; no worries.

    John

    P.S. If you're shopping brokers, look at what you want to see from the company. Is it complex options? low commissions? great research? personal service? Then see which broker gives you what you particularly want. Note that I've never seen Merrill on any list of best brokers.
     
  3. kthx

    kthx New Member

    Thank you as always! I was just making sure that I would be fine if they went bankrupt.:D

    I am actually a little in limbo about selecting a broker. It seems like Merrill Edge decided not to let me do a covered put, which is actually bugging me a lot, since I wanted to buy some stock at a certain price, but then didn't mind using a covered put as a means of buying it.

    My question is: are other discount brokers usually let you do do covered calls and puts?
     
  4. You are covered unless another MF Global happens, which I doubt with this company. If unsure, spread your investments with multiple brokers. This is what I do. Not only for this reason, but some discount brokers are better than others for say buying stocks, or many have commission free ETFs, some have better rates with options, etc.

    With that said, I'm not fan Merrill Edge and review others IMHO that are better on my site.
     
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