SIPC (Securities Investor Protection Corporation)
A non-profit that protects brokerage customers if their broker fails, up to $500,000.
SIPC was created by Congress in 1970 and is funded by member broker-dealers. If your broker goes bankrupt and your securities are missing, SIPC covers up to $500,000 in securities (including up to $250,000 in cash). It does not protect against investment losses; if your stocks drop 50%, that is your loss. Most major brokers (Schwab, Fidelity, Vanguard, Robinhood) carry additional ‘excess SIPC’ insurance through Lloyd’s of London or similar, often into the tens of millions.
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A 60-second lesson that puts this term in context, alongside the others, lives inside the Finlo app.