Freetrade didnât say this. I was responding to someone earlier in the debate who thought it wouldnât matter because most people donât actually read the terms and conditions. My point was that it isnât good business to hide behind the small print. Iâm also not saying thatâs Freetradeâs plan. Theyâve engaged in this conversation and stated their case. Itâs up to individual customers to decide if theyâre aligned with that positioning and then do whatâs right for themselves.
Overall, I think itâs a really interesting discussion and I absolutely agree that itâs a lot more complex than just âshare lending = badâ. For me, personally, I was already reviewing my options and will most likely move along.
Im actually so surprised that they going this way⊠Never seen that coming. Sadly im against share lending and will be moving brokers as soon as possible.
This is the point for me⊠So chump gets it badly wrong. You and me get it right and price soars past point where collateral no longer covers value of borrowed shares. Chump canât resolve their position and becomes insolvent. You and me just get the deposit back, so losing value of any gains. If Freetrade are so sure this will all be fine due to only using too big to fail 3rd parties then @freetrade ⊠youâre making money out of this⊠you take what you say is a tiny risk, not me.
Iâve been a cheerleader for Freetrade but really not happy about exposing my pension to this additional risk. Freetrade have got this wrong. Lend by all means but then they should take the counterparty credit risk not me.
Now off to check out HL fees for my low frequency trading profile. Please reconsider so I donât have to move.
I donât know if you participated in the last crowdfunding round but if you did then it said âSecurities lendingâ on the âProduct roadmapâ page.
There are a bunch of stuff I would have preferred before this but then again I suppose this is essential to fund those things.
I havenât. If security lending is something essential for freetrade what can i doâŠ
You donât stay in a company you donât agree with. Dont really want to be part of robinhood copy therefor itâs better to move on. But all the best to you all.
Iâm personally more concerned that Freetrade are planning to go down the crypto route than I am with securities lending and if not comfortable with the direction, thatâs probably more likely to be the reason I would transfer my portfolio elsewhere.
Well as Iâm only going to invest via my ISA, this doesnât really affect me. But if this gives FT another income stream Iâm all for it.
The negativity surrounding securities lending is mainly due to the recent Reddit obsessed meme stock debacle on other platforms and people not quite understanding the process. Nothing to do with reality.
âStuff happens behind the scenesâ ⊠Yes all seamless until the borrower of the shares canât give them back. That risk is with the individual investor, not Freetrade. If the risk is so small, why canât Freetrade take it on?
The more I think about this the more angry I get about it. Freetrade were not like other brokers. There was a definite moral high ground. This is my pension, my future. Why should I, over a period of multiple decades, leave it open to third party default risk that I canât control? @Viktor seriously! Renew my faith and take the moral high ground back
Totally agree with the above. Youâve already stated that thereâs some risk to this. Weâve not asked for our holdings to be lent out risk or no risk and nor are we to share in any of the potential gains, FT take all of that. Surely if thatâs the case then in principle it should be FT taking on the credit default risk rather than the user that has no say in any of this.
By all means use my shares but if all goes wrong then itâs not fair that I take the hit for it.
As others stated, I have no problems with share lending as long as Freetrade guarantees I get my shares back when I want to sell them. This is the problem, in the current setup we take the risk. If the stock goes up in price and the company that shorted it canât cover its short I will lose money.
Make the option of no share lending part of Plus or something. What you did now is a really bad move that is going to break that trust barrier youâve built over time.
There are better ways for you to make money, crypto trading (I donât know why some people are against it, just donât use it if you donât want), options trading & pre-market and after hours trading for a small fee.
In an insolvency, the collateral value should be greater than the value of your lent securities, but in a scenario where this was not the case, you may receive back collateral value that is less than the cost of replacing the shares.
The right to use which you grant to us allows us to exercise our right to use your Lendable Securities to enter into securities lending transactions at our discretion. We will not notify you where we have exercised our right to use. Information setting out which of your Lendable Securities have been lent will be available via your monthly statement.
