Are you an American investor? Do you actually own the shares of stock in your portfolio? Maybe it would be a good idea to go check those stock certificates stowed away in your safe. What’s that? You don’t have any of your stock certificates? Oh that’s right… your stock broker handles those for you. Ok, ask your broker to tell you the designated owner’s name that appears on those stock certificates. As Jack told his wife in The Shining, “You’ve got a big surprise coming to you! … Go check it out!”
Unfortunately, due to modernization and ‘efficiency’ measures, stock certificates have become obsolete – they no longer exist in physical form. They’re electronic nowadays. Still, you’ll find that neither you nor your broker has been designated as the stock owner on those electronic share entries. It’s likely that the actual owner is a member firm of the Federal Reserve System – Cede & Company. Only in America… right?
This ‘technical’ evolution of stock share management has definitely made trading stocks more convenient as investors can easily trade in and out of their positions in mere seconds. However, what has been unnoticed by the majority is that having these shares centrally owned and managed makes it easier for market manipulators to gain enough shorts to control market movements. The way a short position is supposed to work is that a prospective investor wanting to short-sell a stock must first find someone who currently owns that stock and is willing to lend them his/her shares. With the centralized ownership/management system, that is easily accommodated.
And as if that wasn’t enough to worry about, investors are increasingly becoming concerned about the integrity and honesty of western banking and investment houses. MF Global, for example, has recently cost its clients an estimated $1.5 billion, which they’ve brazenly exclaimed has simply “vanished.” MF Global was caught red-handed – they dipped into their customer base’s funds to cover losses they made in their own proprietary trading activities. Imagine waking up one morning and logging into your investment account only to find that your trading positions and cash holdings had all but disappeared!
But there’s a way investors can protect themselves against such fraudulent activity and also ensure true ownership of the shares in their stock portfolio. In the first edition of our Protect Your Assets series we offer a step by step guide for doing exactly that.
That’s not all, though. There’s another way investors can protect themselves and diversify their stock portfolios at the same time. Perhaps it’s time to look into opening up a foreign brokerage account. In fact, major advantages come to those having an international investment account, such as:
- Access to investment vehicles not available within American borders.
- Cash diversification among several currencies within the same account.
- Ability to trade directly in other global markets
- Cash is generally safer when stored in strict investment brokerages rather than banks, such as Bank of America, which have expanded their services into the investment arena.
But exactly what should an investor look for when researching potential oversees investment firms? In this Protect Your Assets edition, we also cover that, as well as chart a pre-screened list of some of the better foreign brokers, comparing various fees and services.
It’s all in our Protect Your Assets – Stocks edition, where we focus on what an investor can do to protect his/her stock portfolio from being stolen by corrupt financial institutions engaging in fraudulent activity, confiscated by over-zealous government legislation, or gradual erosion by ever increasing localized taxes.
The first part of the report gives step by step instructions on how to ensure stock shares are registered in the name of the investor and how to make the necessary changes if that is not the case. The second part outlines the importance and advantages of having an overseas brokerage account, what to look for in a prospective broker and a pre-screened comparison of several international investment firms worthy of any serious investor’s attention.
Protect Your Assets – Stocks ……………………..
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