What happen to the holding stocks and cash when the financial institute files for bankruptcy?

Let's say if I have an Etrade Security and Etrade bank accounts.


Then, the compony files for chapter 11 or 7. What happens to my stocks and cash in those accounts? How hard would it be to transfer those assets to other firm?

What happen to the holding stocks and cash when the financial institute files for bankruptcy?
Your stocks belong to you and no one else. They do not belong to Etrade. If Etrade goes bankrupt then you will probably receive your stock certificates in the mail. This is really how they used to buy and sell stocks. Stock certificates are really fancy pieces of paper and typically are very ornate. The are embossed with a ID number and entitle the onwer of the certificates to a certain number of shares of stock. But, if you do receive your certificates in the mail then you need to put them somewhere safe as if you loose them, it will be difficult to get them reissued. Each stock certificate has an ID number on it and the company that the stock represents has a record of all of it's stock holders and stock certificates issued. Your information is listed with that specific company so don't worry about loosing your stock. It's yours!





Your cash is yours! You should get it back probably in the form of a check. With Etrade, the people who are loosing are the ones who held Etrade stock.





Good Luck!