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Splitting a portfolio between brokerages -- pros and cons

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Money Talk > Personal Finance

Which brokerage firm do you personally prefer at this time?
Fidelity
0%
 0%  [ 0 ]
Schwab
25%
 25%  [ 1 ]
Other
75%
 75%  [ 3 ]
Total Votes : 4

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v. marie
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Splitting a portfolio between brokerages -- pros and cons  Reply with quote  

Brokerage firm#1 and Brokerage firm#2. Theoretically, a 52 year old widow inherited a 1 mil dollor portfolio when her husband died two years ago. For some reason it was scattered between VanGuard, Fidelity, Schwab, Treasury Direct and three different banks. For two years she has been trying to consilidate the accounts as the different CDs and t-bills matured. Now she has about 50% at Brokerage firm #1 and 50% at Brokerage firm#2. Is there any downside to leaving the accounts in two different brokerages? If her asset allocation is 50% stocks, couldn't she just make the Brokerage firm#1 account 100% stocks and then divide the Brokerage firm #2 account into the 25% bonds and 15% other (real estate, commodities, etc) and leave the 10% cash portion of her portfolio at the bank and Treasury Direct?
Post Thu Jun 07, 2007 5:03 pm
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efflandt
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It depends how much insurance each broker has in case someone runs off with the loot. If each broker has $500k or $550k of insurance, it might be best to keep it split in case something temporarily happens to one of the accounts.

That insurance does not necessarily guaranty investment return or principal, it is more to make sure that your investments still belong to you if the broker goes under or something.

If she puts everything in one account and that account is comprimised or temporarily locked for some reason, then what does she do?
Post Fri Jun 08, 2007 12:43 am
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Case-Face
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consolidate  Reply with quote  

Consolidation for such inheritance is the way to go, b/c like Tim, I think it's just easier to keep track of. It's not like an investment stock portfolio where things need to be diversified if you'd like to earn big. She already has her funds, so keeping it in one place seems like the smart move.
Post Wed Jul 11, 2007 5:09 pm
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