Question

John Jones has an individual cash account; a joint margin account with his wife; a custodial account for his minor daughter; and a custodial account for his minor son; all at the same brokerage firm. If the firm should fail, Securities Investor Protection Corporation will cover:_________.

Answer 1

The correct answer is letter "D": each account separately.

Step-by-step explanation:

The Securities Investor Protection Corporation or SIPC is an agency member of the Securities Exchange Act of 1934 in charge of protecting brokerage account holders from financial institutions that go into bankruptcy. In such cases, accounts are protected by name which implies if one person has different accounts for different purposes -such as in John Jones' case, each account is protected individually.

Answer 2

Each account seperately.

Step-by-step explanation:

Securities Investor Protection Corporation (SIPC) is a non governmental organisation that is mandated with protecting clients is brokerage firms that become bankrupt.

SIPC provides coverage of up to $500,000 for cash and securities.

SIPC coverage is applied per customer name, so John Jone's individual cash account, the joint margin account with his wife, the custodial account for his minor daughter, and custodial account for his minor son will be covered seperately.