How can I earn extra income on my stock investments?
You can actually earn extra income on the fully-paid shares of stock held in your account by joining PT's Stock Yield Enhancement Program. This plan allows PT to borrow shares from you in exchange for cash collateral, and then lend the shares to traders who want to sell them short and are willing to pay a fee to borrow them. Each day that your stock is on loan, you will be paid a loan fee based on market rates. You share a percentage of this with our clearing firm (currently 50%) as a fee for managing the program.
Who can participate in our Sock Yield Enhancement Program?
PT clients1 who have been approved for a margin account, or who have a cash account with equity greater than 50,000 USD.
To sign up for PT's Stock Yield Enhancement Program, log into Account Management and check Stock Yield Enhancement Program on the Trading Configuration/Permissions page, available under the Manage Account tab.
Earn Supplemental Income
Each day that your stock is on loan, PT deposits a percentage of any loan income directly into your account.
Simple and Automatic
PT manages all aspects of share lending. Once you register, PT will examine your fully-paid stock portfolio automatically. If you have stocks that are attractive in the securities lending market, PT will borrow the stocks from you, deposit collateral into your account and lend the shares. It's that simple.
As always, Place Trade clients enjoy complete transparency! When your stock is loaned out, you will see the fee rate that you are being paid on the loan along with the exact management fee you pay to PT. Other brokers with similar programs generally do not disclose the market rates to you, which allows them to pay you a small piece of the pie while holding on to most of the profits. Its a fact!
Trade Your Loaned Stock with No Restrictions
You will see the loaned shares on your account statement, indicating that they are being loaned out. You are still the owner of the stock, which means you continue to have market risk and will recognize any profit (or any loss) if the stock price moves. You can sell your shares at any time without any restriction. If you are not happy with the extra yield you are receiving from the program, you can terminate your participation at any time.
Stocks that are eligible to be loaned out are all "fully-paid" stocks (stocks not held on margin) and "excess-margin" stocks (stocks held on margin but whose market value exceeds 140% of your margin debit balance).
For More Information
For a complete discussion of the risks and characteristics of the program please be sure to review our Stock Yield Enhancement Program disclosure.
To sign up for PT's Stock Yield Enhancement Program, log into Account Management and check Stock Yield Enhancement Program on the Trading Permissions section which is located under the Manage Account menu tab (choose Trading Configuration Trading Permissions).
Clients can only lend in one program at a time. If, for example, a client signs up for the Stock Yield Enhancement program and is already approved for AQS lending, we will disable their ability to lend at AQS and recall their loans. They will still, however, retain the ability to borrow through AQS and can see market data. If the client disables the Stock Yield Enhancement Program, their AQS loan permissions will be re-enabled. The Stock Yield Enhancement Program always takes precedence. For more information, see our Stock Yield Enhancement Program FAQ page.
2US federal tax rates that are quoted in the example above are based upon 2011 rates and are subject to change.
Any symbols displayed are for illustrative purposes only and do not portray a recommendation of any security or securities product.
For more information, see our FAQ page.