As you set up a new home and start making financial plans related to your new lifestyle, you might decide to move your stock portfolio to a different broker. There are several reasons why a portfolio move would make sense, including lower commission rates or a broader range of services a broker offers. The broker transfer process runs through a special system, and occasionally the system does not work as designed. Keeping a close watch on the status of your portfolio transfer is the best way to prevent unnecessary delays.
Request a Transfer Initiation Form from the broker that will receive the stock portfolio.
Complete the TIF and return it to the receiving broker. The name(s) and Social Security number on the TIF must match the account registration where the stock portfolio currently is held. The brokerage firm will enter the information from the transfer form into the Automated Customer Account Transfer Service system operated by the National Securities Clearing Corp. The request to transfer the stocks will be sent to the current broker through the ACATS. The stocks transfer electronically to the new broker.
Contact the receiving brokerage firm after four to five business days to check on the status of the transfer. According to the Financial Industry Regulatory Authority, a transfer should take about six business days to complete. After three days any problems with the transfer will have surfaced.
Remain in contact with the receiving brokerage company until the transfer is completed. Contact the sending broker if you are notified of any issues on the sending end that could hold up the transfer.
- The correct ownership information and type of account are the most important factors to ensure a transfer goes smoothly. A stock portfolio must be transferred into the same type of account, such as an individual account or IRA.
- Do not buy or sell stocks in the account after you have turned in the transfer request form.
- You can check with the old brokerage firm to make sure it has received the transfer request.
- Some types of securities cannot be transferred electronically. These securities must either be sold before a transfer is initiated or possibly transferred manually. Securities that may cause problems include investments handled only by the old brokerage company, certain mutual or money market funds, private placement limited partnerships, annuities and bankrupt securities.
Tim Plaehn has been writing financial, investment and trading articles and blogs since 2007. His work has appeared online at Seeking Alpha, Marketwatch.com and various other websites. Plaehn has a bachelor's degree in mathematics from the U.S. Air Force Academy.