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What Happens If Webull Goes Bankrupt?
What happens to client stocks, money, portfolio, and account investments if Webull goes out of business, becomes bankrupt?
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Could Webull Go Out of Business?
Webull is a relatively new brokerage firm in the United States. If you’re concerned about the safety of this organization, keep reading; we’ve done all the research for you. Here are the results:
Size of Webull
Webull was founded in 2017. Because of its recent launch, it won’t register as a large firm.
Nevertheless, at most recent count, it does have over 11 million users. This is a large number,
although we don’t know how much money these users have deposited with Webull.
Let’s assume that the average account size at Webull is $3,000. With 11 million accounts, that
would translate into roughly $33 billion in client assets. This estimate is average by industry
standards.
By comparison, E*Trade has more than $300 billion in assets, and this is considered a decent
treasure chest. Several firms, including Schwab and Fidelity, have client assets in the trillions.
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Judging Webull’s Health
Webull is a private company, which means it has no stock trading on a public exchange. As a result, it is not required to submit quarterly financial statements to the SEC. This of course makes it harder for us to judge the financial health of the company.
What we can say is that Webull has been growing substantially since its founding just a few years ago. It started with a simple mobile app. Then it added a browser platform, and then a desktop program. It added options trading and then cryptocurrency trading. All along, its software has been growing in complexity.
These impressive advancements are a sign that Webull is healthy.
What Happens If Webull Goes Bankrupt
Webull is a member of FINRA, the SEC, and SIPC. Its FINRA ID number is 304881, and its SEC ID is 801-117281. Both FINRA and the SEC regulate Webull’s activities, while SIPC provides insurance on Webull accounts.
The maximum protection from SIPC is $500,000. This limit is per customer, not per account. Opening multiple accounts won’t give you more insurance.
Webull also has an auxiliary insurance policy through Apex Clearing, which is Webull’s clearing firm. This policy provides $37.5 million in insurance per client.
Can Webull Go Bankrupt Judgment
Any private sector company like Webull that has no government funding could face insolvency if it doesn’t have enough income to pay its bills. We don’t see any evidence that Webull is close to this point. If it ever were, there are many safeguards in place for Webull customers, including two insurance policies and Webull’s ability to sell accounts to solvent brokerage firms.
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Chad Morris is a financial writer with more than 20 years experience
as both an English teacher and an avid trader. When he isn’t writing
expert content for Brokerage-Review.com, Chad can usually be found
managing his portfolio or building a new home computer.
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