VG Fully Paid Lending Program

Investing
1

I haven’t read all the fine print of the new VG program below:

Unlock Income with Fully Paid Lending | Vanguard

It looks like:

  • I can terminate the lending any time I want
  • I can still receive the dividends (maybe taxable) from my stocks
  • The counterparty borrowers decide which stock they want to borrow
  • If the counterparty borrowers go broke, I can collect 102% market values in cash, not the stocks I bought
  • The reward is the additional cash with market-driven rate

Am I missing any major points, or misread anything?

2

There is a thorough post I saw earlier this year that covers the Vanguard program and has links to posts discussing the similar programs at Fidelity and Schwab. Search “WCI Vanguard Fully Paid Lending Program”.

3

I researched the Schwab program and it’s not as good as it sounds. You basically split the 10% interest rate with Schwab. No way would I go 50/50 on a partnership if I am putting up all the $ and taking all the risk.

1 Like
4

Same not worth the risk, though I don’t understand margin investing especially since I can pay a lower interest rate with stock options and have less risk