If my investment company goes bust, am i protected?

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(Edited)

Hello friends! If you’re following me you will see on my previous post talking about “Am I protected if my insurance company goes bust” but on this article we’ll be looking at “if my investment company goes bust, am i protected”. This is the question that i hope my post will give some insight about. Let’s dive in together.
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This guide's primary aim is to help people save their money, but investments in stocks and shares or funds come with risks that cannot be considered savings. Depending on various factors,the FSCS's (Financial Services Compensation Scheme) protection could be different

Investor protection ensures your money stays safe in the event of provider bankruptcy.
If an institution fails where you hold an investments account like banking accounts and other accounts similar to stock trading accounts and savings bonds or even insurance plans like pensions also fall under this category and ultimately this will be covered by FSCS though it doesn't cover loss resulting from failing individual securities/stocks or bond trades.

In short, suppose you hold shares in a firm and it collapses or bought into an underperforming mutual fund then usually no safety net exists to support one since this is how investments work.

You can purchase stocks through various companies without worrying about the bankruptcy of one particular company. Since you'd still own your shares there's no need for any kind of reimbursement.

Different structures for products result in varying levels of investment protection. As a general guideline, always verify but typically speaking...

  • Investment funds: The first £72k invested in funds are guaranteed for refund.

  • Pensions: The degree of protection for your pension money relies on how it is being safeguarded.
    When investing in annuities do not worry about complexity as 100% protection of your money is ensured.
    The initial sum you invest up to £72k is totally covered, and cash balances up to £72k are completely safe and secure from any loss. Deciding where to invest in your self invested personal pension (SIPP) can impact the amount of protection offered under FSCS. The first £72K investment made into stock market funding or other investments has full coverage.

  • Life insurance is a form of “long-term insurance” which ultimately secures 100% protection for your investment when you pay money into a life assurance product.



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