What happens if a broker goes down or closes down?

General
1

Recently, one of my uncles who had all his investments through Karvy said his share transfer is not yet complete to his new broker.

Now many of us may have migrated to our favourite new age discount broker like say WayUpStox or Xerodah etc. Even we may have moved entire family dmat accounts to these so all eggs of entire family is in one brokers basket.

Imagine, if similar to Karvy, Lehman brothers were to happen? Yes, we have heard that it won’t, it can’t happen etc. And, when someone has such conviction, nature disproves it to tame the arrogance/ignorance or just to prove a contrarian point.

Again, this post should not be considered as violating forum rules as it requires serious discussion and constant reminders (People have fresh memory of PayTM IPO big fizzle - though not apple to apple, but definitely apple to orange !!)

2

Could you please clarify this statement. Did not understand. Are u correlating cdsl or nsdl where all our investments are lodged could fail like lehman or asking what would happen if brokers fail?

Lehman was an investment bank

It is for this reason it is critical for all of us to ensure what ever we buy is reconciled with our holdings at cdsl or nsdl. We get periodic statements from them.

There are similar post in this forum as to what happens if brokers go bankrupt

If my broker goes bankrupt, are my shares in demat account safe?