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Brokers regulations

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Luxembourg, Luxembourg
 
Trading Experience: Advanced
Platform: TWS
Broker/Data: Interactive Brokers
Favorite Futures: Stocks
 
Posts: 491 since May 2012
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Grantx View Post
I am trying to decide between Dorman and IB as my broker.
Are funds protected with these institutions? I currently have an account with FXCM here in the UK, and if things go pear shaped with the company, I know that my money is guaranteed up to 50K. Is it the same for IB or Dorman?

Thanks.

If you use IB as a UK resident, you will be with IB UK and thus have the same protection as with FXCM.

Not sure if Dorman has an UK entity, but if they don't your account will be protected under US regulations - SIPC - What SIPC Protects

Deposits with brokers are supposed to be segregated from the brokers' cash balances and therefore you should never need SIPC, but there are exemptions to this. For instance, MF Global used customer money to speculate on Greek government debt and clients of MF Global were not covered by SIPC.

If you are really that worried, you could always open another brokerage account elsewhere and by FOTM put options on your broker (assuming they are listed and have options like IB for example).

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