Fidelity Fully Paid Lending Program
I originally learned of this program's existence on this site, but I cannot find the OP. I searched a couple of different times with different keywords but no luck.
Anyway, I had a meeting with our free Fidelity FA today. I had asked him if our account was a good candidate for this. His feedback was:
- The program is not predictable, but we would randomly get offers to lend one or more of our positions. If we decided to lend, we get interest but the rate varies with each deal.
- We can stop at any time with 48 hours notice.
- We can still sell the underlying security at any time - no notice requirement.
- We still have market exposure during the lending period, so whatever gains or losses occur on that security during the loan still accrue to us.
- We probably won't make a ton of money, but with rates so low, this could be a small supplemental income opportunity.
- Bottom line, he sees no reason that we should not do it.
Does anyone who has experience with this program have anything to add? I'm particularly interested in what reasons there may be not to do it; no real downside sounds great and from reading the material on the Fidelity website, I'm not seeing downside but I'd be reassured hearing something from those who have actually done this.