DriveWealth offers a cash management program to automatically invest or “scan” “free credit” 1 in your eligible driveWealth brokerage accounts (“Accounts”) in a liquid investment that can generate a return while deciding how those funds will be invested over the longer term. This document introduces the features of DriveWealth`s cash management program and contains important information about each function. Eurodollar sweeps are legal transfers of money to the bank`s offshore units, while they are essentially just an accounting technique that allows banks to lend the funds in full without the required reserve requirements and without having to pay for FDIC insurance (the sweep is not insured). For the most part, the funds are only unsecured liabilities of the bank and therefore receive the highest interest rate offered by the Bank for overnight loans. Some businesses choose to scan all their funds into a scan account if they think the increase in revenue will offset more than the fees they would have reimbursed if they had left the money in the account. Other companies calculate the approximate amount needed to pay the fees and then only sweep away funds in excess of that amount. Sweep accounts for individual depositors are typically used by brokers to park money waiting to be reinvested, such as dividends, incoming cash deposits, and money from sell orders. These funds are usually swept into high-yield equity accounts or money market funds until an investor makes a decision on future investments or until the broker can already execute standing orders within the portfolio. ² “Business Day” is every day when the New York Stock Exchange and the Federal Reserve Bank of New York are open to stores. While DriveWealth`s offices may be open on certain holidays, these days are not considered business days for transfer or money related purposes in the cash management program. FDIC insurance coverage is granted to all persons who have deposits with banks covered by the FDIC; A person does not need to be a U.S. citizen or resident to have their filings insured with the FDIC.
If the first calculations are done correctly, the interest rates on cash and investment returns should generate a return high enough to increase the total value of the sweep account. ¹ The term “free credit” means cash not invested in your account, less (i) the funds necessary to pay for the purchase transactions necessary for a cash function after the payment of the funds; (ii) charges to your account; (iii) Credits intended to be considered as a guarantee for your commitments. “Business Day” is the opening day of the New York Stock Exchange and the Federal Reserve Bank of New York. (While our offices may be open on certain holidays, these days are not considered business days for purposes related to the transfer of funds.) Certain retirement accounts – Individual pension accounts (IRA) – defined contribution plans such as a 401k participation plan or profits – self-controlled Keogh plan accounts – a current account owned by a person, without a designated beneficiary – an account created by an agent or custodian for a person, such as accounts created under the uniform Transfers to Minors Act – a transaction account for a sole proprietorship, which represents the accounts of a deceased person Fund The standard amount of deposit insurance is two hundred and fifty thousand dollars ($250,000) per depositor, per FDIC-insured bank, and per property category. . . .