If I want to move to another online broker, how do I transfer my existing stock holdings to that broker? Do I sell all and buy using the new broker? Nope, there is a better way.
Back in the day (around 13 years ago when I was just starting in stocks trading), the more popular online trading sites for retail investors / traders were COL Financial (PSE: COL), formerly CitisecOnline and BPI Trade (PSE:BPI).
Now more and more online trading platforms have proliferated. And because of this, there can be instances wherein a customer will need to transfer his stock holdings from one broker to another, for various reasons, from time to time.
To name a few top of mind online brokers:
- COL Financial
- BPI Trade
- First Metro Securities (sister of Metrobank, PSE: MBT)
- BDO Nomura (sister of BDO, PSE: BDO)
- AAA Equities
- 2Trade Asia
- Abacus Capital
- Philstocks Financial
- MyTrade Philippines
And so much more. Note that I am not in any way endorsing any of the above. Personally, I only have experience using the first 2, until I closed my BPI Trade to solely use COL Financial. Now, after about 5 years, I’m in the process again of opening an account with a new online broker. Which brings me to the point.
SELL ALL, BUY AGAIN?
This may be the first instinct among many of us, but there is a better way. Selling all forces Juan to sell at a loss, or sell prematurely if s/he has gains in a certain stock, plus the fees involved in selling. And buying again with a new broker forces Juan to buy at different prices (assuming the stock price has gone up already), subject to new fees. Good thing there is another way.
STOCK TRANSFER / EQ TRADE FORM
The better, and more official way, to transfer your stock holdings from one online broker to another is via using the stock transfer form or EQ trade form, or whatever your existing broker wants to call it.
- But before all these, you have to OPEN a new account with the new broker where you wish to transfer your existing stocks. Now, if you already have an open account, complete with user name and password and all, do the following:
- Go to your online account with existing broker, and look for the stock transfer / EQ trade or whatever they call this form.
- In the form, you will need to fill out at least the following:
- Name of New Broker where you will transfer
- Account Name / Account Details with New Broker
- Stocks You Wish to Transfer
- Number of Shares
- Average Cost
- Other Personal Details
- Usually, you will need to send a copy of the accomplished form to both existing broker and to your new broker.
Then the two brokers will just coordinate with one another on the validation and actual transfer. This process usually takes a few days (e.g. 2 to 3 trading days) so make sure you don’t unintentionally sell the stocks meant for transfer.
There will be a transfer fee as well depending on your broker (e.g. P75 per transfer). Back in the day, it used to be P75 per stock name you wish to transfer (e.g. for transfer of 2 stocks regardless of how many shares per stock name, cost is P150). Still, I would think this is better than selling your stocks and buying again.
If things go as planned, your stock holdings and the average cost you have for these will be transferred, so when you access your new broker, you should see the same gains or losses that you had prior to transfer. Voila! Same holdings, new broker!
How about the available funds, the buying power? Can I also transfer this?
I don’t think so. I think you will need to withdraw your buying power (post-clearing of any recent sell transaction) and deposit the amount to your new broker.
WHY MOVE BROKERS ANYWAY?
Variety of reasons.
Some try to separate their “long-term holdings” from their “short-term” trades and tsupits. Some more on reliability especially during high volume hours (panic selling or buying) and your broker’s platform suddenly crashes and goes offline.
Some would prefer to move based on user interface, mobility and features. This recent move of mine is because of this. Over the years, my existing broker has not evolved in terms of their mobile app (never really used it much due to poor design), and of course the occasional down times also happen to me when it matters most.
So I’m trying this new broker which offers, supposedly a better “mobile app”, plus stop loss and buy on breakout features (which are unavailable in my existing broker), and though available in some other brokers, you need a PRO account to access it (higher account balance). I haven’t seen the mobile app of this new broker, but I hope it’s very handy indeed in case I want to trade using my mobile phone (like what I do for trading global markets using eToro, their app is very easy to use).
So if things work out, I might be transferring my existing holdings to a new broker. And just leave my preferred shares with the old one.
#GrowYourMoney #BeFinanciallyFree #GYMBFF #InvestMoneyPH
Images from Pixabay.