Allow a professional to trade in your stock trading account
Posted by: admin in Untagged on
May 8, 2010
Fidelity, Scottrade, Schwab and most other large trading brokerage firms allow multi-user accounts these days. This is something that I did not know and thought I should share with you guys because you may benefit from this too.
Read this conversation which explains it pretty well. This was with Fidelity but should work in a similar fashion with other brokerages.
Always remember NOT to trust just anyone, needless to say, your buddy or uncle doesn't qualify (unless he/she also happens to be a professional with loads of experience and credibility...
Srini Venkataramani: Initial Question/Comment: Is there a way I can provide access to my account to a professional who can trade on my behalf but not transfer money in or out? They will need to have their own login and trades should reflect the fact that they are the ones that made the trade, not me. Is that possible? Srini
Joe Scholz has joined this session! Connected with Joe Scholz. Your Reference Number for this chat is 3321327.Joe Scholz: Good evening, Srini Venkataramani; I am glad to help with your trading question.
Joe Scholz: One moment while access your account; thanks.
Srini Venkataramani: Thanks Joe
Joe Scholz: You can grant what is called limited trading authority, which would allow another to place trades, but there would be no way to identify the trades as having been made by that person.
Joe Scholz: The limited trading authority does not allow for moving money in and out of the account.
Srini Venkataramani: How do I set up limited trading authority?
Joe Scholz: There is a form available at our website; may I send you the page in this chat?
Joe Scholz: You fill out the form as the owner, and the other person as the authorized party.
Joe Scholz: Does the other party happen to have a Fidelity account himself?
Joe Scholz: Online access is easier for the authorized party when that is the case.
Srini Venkataramani: I am not sure. But I am sure they can open an account. Does it cost $ to open an account? I actually got mine through NetBenefits from my employer.
Joe Scholz: No, it does not.
Joe Scholz: You can open the account with any balance; the $2,500 minimum mentioned is because that is the minimum for most mutual funds, but you can open the account with a zero balance.
Joe Scholz: Shall I send the trading authority form?
Srini Venkataramani: So the other party can open a $0 balance account and then trade under my account with the limited trading authority, right?
Joe Scholz: Yes, although if the account was never funded, it would eventually be closed.
Joe Scholz: We've looked at the trading authority question; what else may I help you with?
Srini Venkataramani: How much is the minimum funding to not get the account closed?
Joe Scholz: I do not know what criteria is used by those within our firm who close accounts.
Joe Scholz: It happens infrequently but it does happen.
Srini Venkataramani: Ok, got it. Thanks for the help!
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