The Motley Fool Discussion Boards

Previous Page

Investing/Strategies / Retirement Investing

URL:  http://boards.fool.com/hi-us-fools-this-is-jrg-from-germany-and-i-13746318.aspx

Subject:  Re: Taking possession of stocks Date:  11/20/2000  12:59 PM
Author:  TMFZahl Number:  26244 of 76237

Hi US Fools,

this is Jörg from Germany, and I found your discussion via the hot topics page. You can't imagine how surprising this discussion is for a German. So obviously, many of you really keep your shares at home? I think many German stockholders don't even know that's possible.

Where's the advantage of taking care of everything if a broker does it for free (or nearly free)? Aren't they obliged to reimbourse you if they made a mistake that caused you to lose money, e.g. misfiling something? Aren't they insured?

Maybe some of the following is true in USA?

If you hold the certificates at home, you must take care of everything yourselves. In Germany, we have bearer shares usually. That means: You must watch for stock splits. You must claim dividends. Claiming dividends means that you cut coupons and go to the designated bank and collect the money. Walking around with coupons is just as safe as walking around with money since nowhere is your name on them. It's annoying, too. Btw, you should better insure your certificates for the same reason. And don't miss to read all those boring official journals where the company could announce any capital transactions. If you want to sell the shares, you'll have to bring them to a broker first. It can take weeks to get them registered, I think. So, this isn't the fast way to sell anything.

The other possibility, i.e. let the broker do everything for you, is convenient and probably not more expensive than the insurance for your certificates. Since our brokers are usually big banks, they won't go out of business that fast. If they do something wrong, they must pay your bill.

So, more and more corporations don't even print certificates any more. That means, of course, that you cannot even get certificates from each company out there.

Greetings from Germany,
Jörg

Copyright 1996-2014 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us