1/1/2024 0 Comments Cash sweep bank![]() ![]() Any amount in excess of $500,000 will not be covered by FDIC insurance. Retirement accounts with more than one vested participant may qualify for "pass through" deposit insurance coverage for each vested participant, which allows for more coverage than would be available if the account was counted as a single depositor. The RSDA is designed to offer up to $500,000 in FDIC deposit insurance coverage to retirement accounts. and Morgan Stanley Private Bank, National Association. In the RSDA Program, your available cash balances in your retirement accounts will automatically sweep overnight into deposit accounts established on your behalf at E*TRADE from Morgan Stanley's affiliated banks, Morgan Stanley Bank, N.A. FDIC insurance applies only overnight while the funds are in a Program Bank. You also should include other accounts you hold in the same title and capacity at any of the Program Banks in calculating FDIC insurance coverage limits, because coverage limits are set per customer across all accounts. Any amount in excess of $500,000 ($1,000,000 for joint accounts) will not be covered by FDIC insurance. When the ESDA is designated as the sweep option for your brokerage account, available cash balances in your brokerage account are automatically deposited overnight in bank accounts at up to five depository institutions (each a "Program Bank"), with deposits at each Program Bank insured by the FDIC for up to $250,000, resulting in total FDIC insurance coverage for cash in an ESDA of up to $500,000 for individual and $1,000,000 for joint accounts, the maximum applicable deposit account insurance available through the ESDA program. The Extended Sweep Deposit Account (ESDA) program is a cash sweep option for E*TRADE from Morgan Stanley brokerage accounts. In addition, we receive revenue sharing payments from MSIM in the event a sweep fund waives its fees in a manner that reduces the compensation that we would otherwise receive. You should understand these costs because they decrease the return on your investment. We have a conflict of interest to only utilize affiliated money market funds in BDP or as an alternative for clients that are not eligible for BDP, and those affiliated funds and share classes that pay us more compensation than other funds and share classes. Please review your sweep money market fund’s prospectus to learn more about the compensation we receive from such funds. We receive compensation from these funds at rates that are set by the funds’ prospectuses and currently range, depending on the program in which you invest, from 0.10% per year ($10 per $10,000 of assets) to 0.25% per year ($25 per $10,000 of assets) of the total money market sweep fund assets held by our clients. You will bear a proportionate share of the applicable fund’s expenses in which your account assets are invested. Our affiliate, Morgan Stanley Investment Management (“MSIM”), serves and receives compensation as the investment adviser to the money market funds that are available as part of the Bank Deposit Program (“BDP”) or as an alternative if you are not eligible for BDP. If the account is ineligible to participate in the Bank Deposit Program, any free credit balances in the account will be swept into one of the alternatives based upon eligibility.ĬOMPENSATION PAID TO Morgan Stanley Smith Barney LLC The Bank Deposit Program is described in the account opening materials as well as in the Bank Deposit Disclosure Statement. The Bank Deposit Program is the default sweep option for accounts at Morgan Stanley Smith Barney unless the account is ineligible to participate in the Bank Deposit Program. (Please see above for MGPXX 7-Day Effective Yield.)įree credit balances generally include the uninvested cash in a client’s account(s) minus certain items such as purchase transactions due to settle within a specified time period, other charges to a client’s account(s), and cash balances that are designated as collateral for a client’s obligations. Deposit balances above $20 million in an account are swept, without limit, to MGPXX. Interest rate tiers are based upon value of total deposit balances in the account. For more information, view the Bank Deposit Program Disclosure Statement. Under the Bank Deposit Program, free credit balances held in an account(s) at Morgan Stanley Smith Barney LLC are automatically deposited into an interest-bearing deposit account(s), at FDIC-insured banks.
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