Educational purposes only. This content does not constitute investment advice. Read our disclaimer
StockCram is not a broker-dealer, investment adviser, or financial institution. All content is for educational and informational purposes only and should not be construed as personalized investment advice. Consult a qualified financial professional before making investment decisions. Past performance does not guarantee future results.Simple Definition
Securities Investor Protection Corporation - insurance that protects your brokerage account if your broker fails.
Why It Matters
SIPC protects you if your brokerage firm goes bankrupt - up to $500,000 per account (including $250,000 for cash). It's similar to FDIC insurance for banks. SIPC doesn't protect against market losses (if your stocks go down, that's on you), but it does ensure you get your securities back if your broker fails. All major US brokers are SIPC members.
Key Points
- Covers up to $500,000 per account ($250,000 for cash)
- Does NOT protect against investment losses - only broker failure
- Many brokers carry additional private insurance beyond SIPC limits
Learn More
Choosing a Broker
Get a complete explanation with examples, key takeaways, and a quiz to test your knowledge.
Related Terms
Common Questions
Securities Investor Protection Corporation - insurance that protects your brokerage account if your broker fails. SIPC protects you if your brokerage firm goes bankrupt - up to $500,000 per account (including $250,000 for cash). It's similar to FDIC insurance for banks.
SIPC protects you if your brokerage firm goes bankrupt - up to $500,000 per account (including $250,000 for cash). It's similar to FDIC insurance for banks. SIPC doesn't protect against market losses (if your stocks go down, that's on you), but it does ensure you get your securities back if your broker fails. All major US brokers are SIPC members.
Covers up to $500,000 per account ($250,000 for cash)
Does NOT protect against investment losses - only broker failure
Many brokers carry additional private insurance beyond SIPC limits