The depository: where your securities actually sit
· beginner
Automated material · TradeAlmanac editorial deskDraft prepared by a language model from our stored data; not reviewed by an editor.
Paper share certificates disappeared long ago. Ownership is evidenced by a record, and the question "where are the securities" is really "who keeps that record, and where".
Who keeps it
Your broker opens a custody account for you at a depository. The depository maintains the records of owners. Above them sits the central depository, keeping the record at the top level.
That gives a chain: issuer — central depository — the broker's depository — you.
What follows
A broker losing its licence does not destroy the securities: the records remain and can be transferred to another broker. The procedure is slow but possible in principle.
Why the chain matters
Every link is a point of failure. For a Russian security bought through a Russian broker the chain is short and entirely within one jurisdiction. For a foreign security it is longer and reaches beyond it.
It is the length and geography of the chain, not the name of the security, that define infrastructure risk — Restrictions and infrastructure risk: how it differs from market risk.
What you can verify
The depository's statement of your custody account. It shows the records exist independently of the broker's app, and it is worth requesting at least once.
Related: The brokerage account: what it is and what it is not.
Draft prepared by a language model from our stored data; not reviewed by an editor.
Model: claude-opus-5
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