Freetrade Competitors

In the rare event where a stock is lent more than once it doesn’t change anything. The borrower is still required to give back the equivalent stock regardless of who they sold it to. It doesn’t matter if the person the borrower sold it to also lends the stock.

Freetrade also don’t lend stocks so it doesn’t apply to them in this case.

If your fear is around stock lending then FSCS protection isn’t what will protect you, you need to use only brokers who don’t do stock lending.

2 Likes

You and others keep repeating this, but it makes no difference what FT does in regard to lending out shares.

If I can buy GME stock right now, and we know for a fact that more than double the number of real shares are floating around than actually exist, it doesn’t matter if FT lends out my “share” or not. The likelihood of me having bought a real share in the first place is almost zero. The institutional investors with multiple percent stakes in the company are in a good position to get guarantees that they have the actual shares, retail investors not so much.

And that’s great in theory. But if FT or the broker goes bust and the share was fabricated several layers away, honestly I don’t rate my chances of getting it back.

And I don’t really want to fixate on GME here, because honestly it’s not a stock I even care about. My point was that it seems unrealistic to just believe in the happy day scenario when there is at least one example of a common stock where the proof of ownership could be next to impossible.

And like I say, who is going to track down all these problem cases in the event FT or the broker went bust? Because my recourse in that situation is to go to FSCS whose stance is maximum £85k compensation.

This isn’t an issue about whether I trust FT or not. Obviously, I trust all the companies I invest with, or I’d be a fool to invest with them. The issue is what happens when something goes wrong.

The administrator

You own the share because you bought it. The scenario it sounds like you’re thinking of is if someone (A) lends a share to the borrower (B) and the borrower sells that share to someone (C), and person Cs broker lends out that share to another borrower (D) who sells to person E.

Person E owns that specific share, but they have zero requirements to give it back. It’s theirs. The borrowers are obligated to give back an equivalent share when they said they would. It doesn’t matter that it was borrowed twice to person E.

7 Likes

This is the whole premise behind the short squeeze thing. If person E won’t sell they have to find another share from somewhere else. If multiple short sellers are all trying to buy shares to cover at the same time they push the price up

Person E in that example doesn’t need to do anything, and still holds the share. It’s the people who borrowed it then sold it to him that are in trouble

1 Like

It looks like the above recent discussion is out of topic for this thread. Maybe create another topic please?

3 Likes

Why do you think that the shares don’t exist? You seem to be confusing share ownership and shorting or options on shares.

Using your example of GME if you buy a share then you own it - end of story. I’m not sure where you have seen reliable evidence that more GME shares are circulating than actually exist - that sounds like either nonsense or a misunderstanding around shorting.

Let’s continue this here:

Not sure if anyone’s shared this old article, but it’s pretty hilarious. The Financial Times seemed to have discovered the chief executive of Trading212 shilling their platform under a fake acount in this very forum:

https://www.ft.com/content/2c308470-e8b7-40e3-bcd4-d9d4696233b4

1 Like

That’s brilliant and just confirms my beliefs. :man_facepalming: :+1:

Some of the fake accounts are so bad they complain about stuff that isn’t even real :joy: It is big business though to put out fake reviews etc and one reason I reckon this would be a great idea to at least limit them or see they are genuine account holders.

It takes seconds to open an account but the bad impression lasts much longer. It is no surprise the vast majority of complaints on the forum around a small amount of topics are new accounts that come for one thing then never again heard. I don’t like the idea of closed communities but it would be great to know if those complaining loudest are actually who they say they are. It works well for some big companies on their review sections :+1:

To be fair, this is true of most legitimate users too. Most people have better things to do that hang around reading forums, the people who post a lot here are definitely outliers who see investing now as an interest rather than just a financial chore.

If a company tells you to get support from a forum (and to be fair, has terrible customer support by other channels), when you have problems you will come and moan on the forum. My own first few posts were all about the terrible initial experience of depositing money and it not appearing with no response at all from FT. Fortunately, it got resolved (but through the passage of time, not from any customer support) and I stayed around and I’m now mostly positive about the platform and enjoy the forum for all the learning opportunities here.

But we can’t lose sight of the fact that most of the people complaining are probably doing so because it’s about an issue that is genuinely worrying them, even if it’s a hypothetical worry at this point (e.g. people worried about GME hitting £25k or me asking about FSCS etc) and probably unfounded in the long run.

2 Likes

I am 100% behind those with genuine worries and you kinda proved my point :joy: You joined with complaints and stayed to become a highly regarded member of the forums. If you had a verified user tag then it would have been nice to confirm you were in fact real.

Most fake accounts just post the same thing and disappear which reinforces the panic among some new members :man_facepalming: It is a tried and tested method of upsetting communities and is used in gaming worlds where people set up alt accounts to reinforce their views.

My point is the community that stay beyond a couple posts are VERY helpful even when not in agreement and always willing to help each other. Having a verified user tag would simply show the poster is an FT customer and surely that would be good to eliminate the people claiming to be users and there are quite a few :+1:

And yes FT are not perfect by a long mile :joy: I love the platform and think it is super at what it is meant to be but find the customer service is based on being “very friendly” with little substance or actual answers involved :man_facepalming: I have faith in them but they do need a big improvement on that side of things compared to some other fintech companies :+1:

2 Likes