3 ms·

Cede & Co isn't the nominal registered owner of all stock on the US markets - not all US shares are street name. My IBM shares, for example, are held directly w

Cede & Co isn't the nominal registered owner of all stock on the US markets - not all US shares are street name. My IBM shares, for example, are held directly with Computershare as transfer agent/share registry. Of course, go outside the US where the stock markets are less insane, and you'll find plenty of places where direct electronic registration is perfectly normal, such as Australia.

will_brown 9y ago
John Wilcox is one of the leading legal authorities on the subject and specifically funny enough uses IBM and DTC as an example, in this except from the SEC website: "Example. John Investor purchased 1,000 sharhs of IBM common stock through Meril Lynch, his broker (a DTC participant). John Investor's shares are a small fraction of the total shares deposited in Merrill Lynch's participant account (i.e,,, 10 million), which in turn are a small fraction of the total number of IBM shares represented by certificates held in DTC's vaults live., 100 million). (DTC's entire position (100 million) is represented on IBM's share register under the name "Cede & Co."') After John Investor gave his broker the instruction to purchase the shares, his broker obtained them in the market from one or more sellers, each of which ultimately had its own DTC participant account. To effectuate the trade, DTC reduced the selling participants' accounts by an aggregate of 1,000 and increased Merril Lynchs account by 1,000. It is important to understand that DTC legally owned those shares both before and after the transaction-it merely shifted them from one account to another." See: https://www.sec.gov/comments/4-537/4537-25.pdf https://www.sec.gov/comments/4-537/4537-25.pdf But I'll concede the point as Computershare is the actual owner not DTC/Cede, but replace DTC/Cede with Computershare, the ownership principal is the same, Computershare is the legal owner of IMB shares at all times (before and after you buy the stock) you would only become a beneficial owner at any given point.
- ajdlinux 9y ago
  (I need to do a bit more research when I get home and have access to my account details... this is, of course, the understanding of one, individual, non-American investor.) No - in my case, Computershare is the transfer agent, not a nominee. Computershare is contracted by IBM to actually administer and maintain IBM's share register, in which Cede & Co is listed as the legal owner of a huge chunk of shares, and I'm directly registered as the legal owner of a couple of thousand dollars of shares. Google "direct registration". I didn't buy my IBM shares through a broker/DTC participant/any other financial institution. In my case, IBM issued the shares directly to me, instructing Computershare to update the share register accordingly.
  - kasey_junk 9y ago
    Further you can demand actual share certificates from Computershare and they are obligated to provide them (at least they were >10 years ago when I wrote the software that printed them). Street side shares are owned by Cede, but as you mention other non street side shares are directly owned. This includes direct share grants, employee stock purchase plans and dividend reinvestment plans.
    - ajdlinux 9y ago
      Can confirm that I still have the ability to request certificates on demand just by filling out a form in the online account manager. (As an Australian, the idea that stock certificates are still something that exists at all for publicly-listed companies absolutely astounds me, but anyway...)
deleted 9y ago
[deleted]

will_brown 9y ago

John Wilcox is one of the leading legal authorities on the subject and specifically funny enough uses IBM and DTC as an example, in this except from the SEC website: "Example. John Investor purchased 1,000 sharhs of IBM common stock through Meril Lynch, his broker (a DTC participant). John Investor's shares are a small fraction of the total shares deposited in Merrill Lynch's participant account (i.e,,, 10 million), which in turn are a small fraction of the total number of IBM shares represented by certificates held in DTC's vaults live., 100 million). (DTC's entire position (100 million) is represented on IBM's share register under the name "Cede & Co."') After John Investor gave his broker the instruction to purchase the shares, his broker obtained them in the market from one or more sellers, each of which ultimately had its own DTC participant account. To effectuate the trade, DTC reduced the selling participants' accounts by an aggregate of 1,000 and increased Merril Lynchs account by 1,000. It is important to understand that DTC legally owned those shares both before and after the transaction-it merely shifted them from one account to another." See: https://www.sec.gov/comments/4-537/4537-25.pdf https://www.sec.gov/comments/4-537/4537-25.pdf But I'll concede the point as Computershare is the actual owner not DTC/Cede, but replace DTC/Cede with Computershare, the ownership principal is the same, Computershare is the legal owner of IMB shares at all times (before and after you buy the stock) you would only become a beneficial owner at any given point.

ajdlinux 9y ago
(I need to do a bit more research when I get home and have access to my account details... this is, of course, the understanding of one, individual, non-American investor.) No - in my case, Computershare is the transfer agent, not a nominee. Computershare is contracted by IBM to actually administer and maintain IBM's share register, in which Cede & Co is listed as the legal owner of a huge chunk of shares, and I'm directly registered as the legal owner of a couple of thousand dollars of shares. Google "direct registration". I didn't buy my IBM shares through a broker/DTC participant/any other financial institution. In my case, IBM issued the shares directly to me, instructing Computershare to update the share register accordingly.
- kasey_junk 9y ago
  Further you can demand actual share certificates from Computershare and they are obligated to provide them (at least they were >10 years ago when I wrote the software that printed them). Street side shares are owned by Cede, but as you mention other non street side shares are directly owned. This includes direct share grants, employee stock purchase plans and dividend reinvestment plans.
  - ajdlinux 9y ago
    Can confirm that I still have the ability to request certificates on demand just by filling out a form in the online account manager. (As an Australian, the idea that stock certificates are still something that exists at all for publicly-listed companies absolutely astounds me, but anyway...)

deleted 9y ago

[deleted]