Good point. iShares/Blackrock has a page of explanation about this. Interesting to read. Vanguard lend out shares from their ETF holdings also.
IB are giving 50% of the lending income back to the original holders, any plan for that?
No it’s funding your free account.
@H2T2 We wouldn’t do this if there was even the slightest possible chance of something going wrong, either with dividends, missing stocks, or anything else.
As for the voting rights, since the shares are held in a nominee, that, unfortunately, makes it a no-no even if they aren’t lent out.
@Cristi That will go to Trading 212 to make the equity side of the business even more sustainable.
so, who do the real voting rights go to? who are the nominees? Interactive Brokers?
This question is answered here. “The borrower of the securities has the right to vote.” But as has been pointed out, one doesn’t have voting rights in any case. This is normal. I do not have voting rights for my shares with any of the other three brokers with whom I have holdings, nor with companies owned via ETFs, investment trusts and OEIC funds. I wish I could own enough MSFT that voting my shares would be significant. I currently own about 100 billionths of the company.
Honestly, this is normal practice and nothing to worry about.
It’s not going to be like your 1k shares of ABC are sitting in your portfolio one minute, and then gone the next (correct me if im wrong)
well that’s a bummer then
@David and what happens if the shares I own get lended and the broker defaults? How will the protection work in this case?
It is no longer free.
From what I have read in discussion above the borrower puts up cash collateral of at least 102% of the shares’ value. This all managed by Interactive Brokers, a company founded 42 years ago, with market cap of $17b and in the NASDAQ 400 (0.2% of SPY4 ETF). The shares that are lent out are only a fraction of those which Interactive Brokers holds in custody.
Please feel free to elaborate.
I spoke to support staff on Chat and I was told “Share Lending is highly applicable to ISA account with Trading 212”. This is really confusing and some of the posts above says ISA account is excluded. I also noticed on the website ISA account is no longer advertised.
While on the Chat I asked to Opt Out as the email says “contact support to Opt Out”. However I was told “That is not possible”.
So I am getting concerned about what actually Trading 212 is doing. The confusing communication it is sending from multiple channels is misleading.
Well if I was personally concerned, I would take time and read the update in terms:
Then based on questions/concerns I would reach to chat support for further explanation.
To opt out from my understanding means termination of contract. Meaning you terminate account on t212. So it is not possible at present.
I think it is location of browser based? or IP address. So should be source UK, if EU I don’t think it should be displayed. I never see it from non UK location.
Sounds like that’s working as intended then to be honest?
I am just stating why the person above might not see it. Maybe he is UK resident, temporarily outside UK, on EU IP/location, thus doesn’t see ISA.
I would rather pay a monthly subscription instead help these speculators