Best question yet. You own them 100% . You used to be able to request paper certificates too.
The day you agree to "Margin" you no longer are the true owner. Because the brokerage firm takes your securities if they need them to sell to someone else that wants to borrow them. And pay the brokerage interest that they keep. You still have the stock in your account. But its technically an IOU. Or also its technically now (2 stocks that were created) you have the original stock share. And someone else has another share they purchased. When someone else (3rd) party sold it to them. 2 people own the (1) stock that you originally own and is still in your account.
The amount of your brokerage account if held in Type Margin. Now has leverage. Let's agree the amount is 50%. You have 100k in account. You can now buy 150k of securities and you are paying the company interest on the extra 50k
Do Not Play with Fire. Do Not use margin (stupid) sometimes you have to use margin. But its a bad idea for a long term investor.
Don't leverage more than 100% of what you own. So don't use 150k of buying power.
If you do not have Margin the brokerage firm cannot touch your stock.
Robinhood also makes money by encouraging Margin , and then LOANING your securities to other firms or people and charging 7% interest to them . And you get nothing.
You take your 100k. Leveraged at 150k. Buy 150k of XYZ stock. And now you are also paying 7% to borrow the 50k .
Brokerage is also making payment for order flow too
Does a purchase through brokerage provide true ownership of the shares or is it by proxy and the brokerage owns them?
That would be the crux in any lawsuit arising from them selling one of their customers positions.
Best question yet. You own them 100% . You used to be able to request paper certificates too.
The day you agree to "Margin" you no longer are the true owner. Because the brokerage firm takes your securities if they need them to sell to someone else that wants to borrow them. And pay the brokerage interest that they keep. You still have the stock in your account. But its technically an IOU. Or also its technically now (2 stocks that were created) you have the original stock share. And someone else has another share they purchased. When someone else (3rd) party sold it to them. 2 people own the (1) stock that you originally own and is still in your account.
The amount of your brokerage account if held in Type Margin. Now has leverage. Let's agree the amount is 50%. You have 100k in account. You can now buy 150k of securities and you are paying the company interest on the extra 50k
Do Not Play with Fire. Do Not use margin (stupid) sometimes you have to use margin. But its a bad idea for a long term investor.
Don't leverage more than 100% of what you own. So don't use 150k of buying power.
If you do not have Margin the brokerage firm cannot touch your stock.
Robinhood also makes money by encouraging Margin , and then LOANING your securities to other firms or people and charging 7% interest to them . And you get nothing.
You take your 100k. Leveraged at 150k. Buy 150k of XYZ stock. And now you are also paying 7% to borrow the 50k .
Brokerage is also making payment for order flow too