Lending securities

[Texas Proud]

I got an email from Schwab that they would like me to sign up to lend some of my securities...


Does anybody here do this? What kind of money can you make?


If the income is good I might do it, but if small amount it is not worth it IMO...

 

[audreyh1]

For people to short.

You’ll get paid your dividends for loaned shares but they will no longer be qualified dividends, rather ordinary income.

Don’t know about additional amounts you’ll be paid.

People with margin accounts already agree to this as a condition AFAiK.

 

[jazz4cash]

I signed up with Fido. Two loans in 2 years. Both were repaid within a few days so the interest was minimal. I think it depends on how popular your holdings are. I was quite surprised both loans were for mutual funds and not stocks.

 

[Texas Proud]

I signed up with Fido. Two loans in 2 years. Both were repaid within a few days so the interest was minimal. I think it depends on how popular your holdings are. I was quite surprised both loans were for mutual funds and not stocks.

So not a lot of money coming in on your lent securities?


I have mixed feelings as I would like extra money where I do not have to do anything but also do not want to get into something that might cause me a headache later when it comes tax time...

 

[jazz4cash]

So not a lot of money coming in on your lent securities?

.

Correct. I guess if you are holding securities that are in demand you could do better. I can’t recall any issues at tax time but my securities were probably IRA funds.