TD Ameritrade Courtesy Fill Notifications

On my original Ameritrade account, there is an option to receive fill notifications. For those not familiar with the term, a "courtesy fill notification" is notice from the broker that one of your stock orders has gone through. This can be either by Email, phone, or fax, and there is no extra charge for this service. The choice to select a fill notification is found under "Communications" on the "General" tab of the "My Profile" page. And you can get to "My Profile" by selecting "Portfolio & Accounts". In my case, I have the broker call me (through their automated phone system) whenever a trade has been executed. There was a time when a real person would call to notify you of your trade, but that seem like a thing of the past now.

I think that this is a useful feature on my Ameritrade account, but I don't see this same option in the TD Ameritrade accounts that were converted over from TD Waterhouse. I am assuming that you cannot get automatic fill notifications if you had a Waterhouse account. Has anybody else been able to setup courtesy fill notifications from their former Waterhouse account?

DC

Countrywide Bank Update

I have two updates to my post about Countrywide Bank. First of all Countrywide has increased it SavingsLink interest rate to 5.5%, with a $10,000 minimum account balance. Considering that many Certificates of Deposits (CDs) don't even pay that much, this interest rate is quite impressive.

I mentioned that SavingsLink accounts have to be linked to a savings or checking account at another financial institution for you to access your money. At the time of my post, Countrywide only allowed one linked account at a time. Furthermore, the process of linking and unlinking accounts is cumbersome. So, the other update is that recently received an Email from Countrywide saying that they've increased the number of external linked accounts to 5. Though I haven't yet tried adding more accounts, this improvement should take away some of the pain of transferring funds between Countrywide and other banks.

Lastly, a reader of PFStock expressed some concern about Countrywide Financial (NYSE: CFC), the parent company of Countrywide Bank. CFC stock has been buffeted over the past year by sub-prime concerns. Indeed, CFC is down over 50% from its 52-week high. And, I do understand the reader's concern. But actually, because Countrywide Bank is FDIC insured, this is not something that depositors need to worry about as long as they stay within the FDIC insurance limits.

DC

Link Exchange

You can have your blog listed for FREE at PFStock. I am looking to add more blogs to my blogroll. If you have a bona fide personal finance blog, please Email me (my contact information is listed in the sidebar) about exchanging links. Note that I do not currently link to commercial, real estate, or multi-level marketing blogs.

Only personal finance blogs that are written by individual bloggers on a not-for-profit basis qualify for a free listing in the blogroll. Blogs and websites that do not qualify for a free listing may inquire about the low advertising rates offered for PFStock sponsors.

DC

Business 2.0 = Fortune 1.0

I just received my last issue of Business 2.0 magazine. This post is a follow-up to my article about Business 2.0 going out of business. A note on the cover of the magazine answers my question about what will happen to the issues remaining in my subscription that have already been paid for. They will substitute one copy of Fortune magazine for every 2 paid copies of Business 2.0 remaining. There is also an option to request a refund if you are not happy with receiving Fortune as a substitute.

DC

NetBank Closes Down

As of Friday (September 28) NetBank has been closed down, and the FDIC has now taken over the bank. According to the FDIC, "No advance notice is given to the public when a financial institution is closed." However, I have written extensively about NetBank, and readers of PFStock would have been given full advanced warning that NetBank was on the brink of closure.

To summarize the current situation, depositors with less than $100,000 at NetBank have their deposits fully insured by the FDIC, and their accounts will be transfered to to ING DIRECT. Depositors with over $100,000 may have a portion of their funds that are uninsured, and will lose half of the uninsured amount. Investors in NetBank stock should fully expect to lose ALL of their money. NetBank is essentially bankrupt at this point and stock investors do not usually recover any funds.

PFStock's coverage of NetBank began over a year ago on September 20, 2006, when I posted here that I was about to begin the process of withdrawing my money from NetBank and close my account with them. In that post, Sayonara NetBank, I referred to this process as "evacuating my money." There and in subsequent posts on PFStock, I cited deteriorating financial conditions at NetBank as one of my prime reasons for closing out my account. At that time, I conceded that NetBank was not likely to be forced into bankruptcy, but was wrong.

Over the course of the last year, financial results at NetBank continued to deteriorate. The company eliminated its dividend, and later ousted its CEO in October 2006. Even before this event, I had speculated that something fishy was going on at NetBank. And, I asserted that NetBank could no longer remain competitive with other banks in its online market space.

After a set of staggering losses, NetBank's independent auditor resigned. The stock was eventually delisted from Nasdaq, after it fell well below $1. In May 2007, NetBank made an agreement to sell a substantial portion of its remaining assets to privately held EverBank. This deal was supposed to have been completed by July, but it recently fell through. As recently as my September 10 posting, I speculated that the EverBank deal was in serious jeopardy. With the collapse of this deal, it became obvious that NetBank had exhausted all of its options, and was only be a matter of time before NetBank would be forced by government regulators to liquidate.

The NetBank bankruptcy saga has been an interesting ride. But as the story is nearing an end, this may likely be my last post about NetBank.

Further reading:

NetBank Continued 9/10/2007
NetBank Again 8/5/2007
NetBank's Demise 5/22/2007
The Decline and Fall of Internet-only Banks 12/1/2006
Unprofitable and Unstable, NetBank Ousts its CEO 10/3/2006
More on NetBank 10/2/2006
Sayonara NetBank 9/20/2006

DC

MS Money Plus (2008) System Requirements

A while back, I posted an article about issues that I was having with Microsoft Money 2004. I have the 2007 version of MS Money, and found it to be generally good, but there are a few features that are missing. For example, you can more easily switch between investments in the 2004 version. There is a drop-down box that allows you to quickly view any securities that you've entered into MS Money, but this feature doesn’t exist in the 2007 version. Also, the 2007 version of Money only runs under Windows XP Service Pack 2 (SP2) or Windows Vista.

For 2008, Microsoft has renamed their financial software as "Microsoft Money Plus". Have you seen the system requirements? Again, you need to be running either Windows XP Service Pack 2 (SP2) or Windows Vista.

Looking at the box for MS Money Plus (Deluxe version), I was actually shocked by the system requirement to run the software under Windows Vista. For PCs running Windows XP, the minimum requirements are quite reasonable: a Pentium II 300-MHz or faster processor (or compatible), and 128 MB of RAM.

However, for those with PCs running Windows Vista, the requirements are much more demanding: a Pentium (or compatible) 1 gigahertz (GHz) or faster 32-bit (x86) or 64-bit (x64) processor, and a whopping 1 GB of RAM.

I’m starting to question why the requirements are so drastically different for Windows Vista versus the same software running under Windows XP. Is Vista version of MS Money Plus so phenomenally superior to Windows XP? Is there anybody who has the software that can give some insight as to what the main differences are between the two software versions?

DC

Business 2.0 Is Out Of Business

I previously mentioned that I subscribe to Business 2.0 magazine. I've had a subscription off and on since the magazine's first issue. The parent company of Business 2.0, Time Warner, is pulling the plug on the magazine. I believe that the October 2007 issue of Business 2.0 will be its last.

I know that they are no longer offering new subscriptions to Business 2.0. However, I wonder what will happen to the issues that I've already paid for... Will they offer a refund, or substitute another financial magazine like Money or Fortune? So far, I haven't heard anything about plans for current Business 2.0 subscribers.

DC

Cosmetic Changes at Sun Microsystems

I own shares in Sun Microsystems. Sun has recently made a couple of largely cosmetic changes to its stock. First of all, Sun has changed their stock ticker symbol from SUNW to JAVA. They put out a press release giving a few reasons for this change. The truth is that this change is mostly cosmetic. But I did have to manually change the stock ticker symbol in Microsoft Money and other records that I use to keep track of my cost basis. I also occasionally read the message boards at Yahoo Finance, and noticed that Yahoo has not yet setup a message board under Sun's new ticker symbol: JAVA.

Another largely cosmetic change is that Sun Microsystems will ask its shareholders to authorize a 1 for 4 reverse stock split at its Annual Meeting of Stockholders on November 8, 2007. This won't affect most shareholders, other than having to remember to correctly account for the change in their tax basis. As an example, suppose that a shareholder has 1000 shares of JAVA and it trades at $6 before the reverse split. After the split, this person would own 250 shares that are trading around $24. In either case, the total value of the stock holdings is the same, and the cost basis doesn't really change. However, an issue that might come up is if one ends up with a fractional share after the reverse split (i.e. one doesn't own a multiple of 4 shares of stock). In this case, the balance of the fractional shares will be paid out in cash. This, albeit small, transaction might end up being a taxable event for shareholders.

For years, I have used Sun Microsystems computers for my work, designing semiconductor chips. I remembered that the original stock symbol (SUNW) stands for Stanford University Network Workstation. But, I haven't heard it called that since I was in college.

DC

TD Ameritrade Spam Frustrations

I write about TD Ameritrade so much that I've considered calling my blog "The Unofficial TD Ameritrade Blog". Anyway, I am still receiving spam at my Ameritrade and Waterhouse Email addresses. It is getting very frustrating. In a previous post on the topic, I mentioned how I use a unique Email address for my Ameritrade accounts. What is particularly frustrating is that now many of these spam messages are making it through my spam filter.

I know that I am not the first person to write about getting SPAM at my Ameritrade Email address, as it has been reported by other PF bloggers. I created a unique Email address for my Ameritrade account through Yahoo's "AddressGuard" feature. The only entity that knows my Ameritrade Email address is Ameritrade itself. However, I have been getting spam at this address. Whenever this happens, I change my Email address to a new one, and delete the old Email address.

This has happened at least four or five times already (I lost count). However, it is the first time that the Email address that I used for Waterhouse has been compromised. I currently receive similar spam at both my Ameritrade and Waterhouse Email addresses. I have also been getting correspondence from other bloggers who are experiencing the same issue with TD Ameritrade.

Through my site meter, I have some insight about who reads my blog. I can confirm that employees of TD Ameritrade read my blog regularly, and that they are very much aware of the spam issue. The site meter typically shows Ameritrade employees as accessing my blog from either Nebraska, New York, or New Jersey. In some cases, employees of TD Ameritrade have been specifically searching for "Ameritrade spam" on the web. However, these readers have never responded to any posting that I've made; the silence from TD Ameritrade employees is deafening. Perhaps TD Ameritrade has a policy of not allowing its employees to comment in public forums.

In any case, I hope that TD Ameritrade gets it act together soon. They really need to plug up the holes in their security.

DC

NetBank Continued...

By now, I thought that I would be finished writing about the demise of NetBank. On May 21st, NetBank announced that it was selling a substantial portion of what remaining assets it has to privately held EverBank. At that time, I noted in my posting that when this sale closes, NetBank, as you know it, would be no more. According to the parties involved, this deal between NetBank and EverBank was supposed to be completed in late June or early July, resulting in the conversion of NetBank accounts to EverBank. However, June, July, and even August have passed without any further word on the state of the conversion. Then this notice appeared on the NetBank website:

NetBank is still actively working to transfer its deposit relationships to EverBank, an award-winning national financial services provider with an exceptional value proposition. When we announced our agreement with EverBank in May, we expected to first complete the sale of other bank investments to have the means necessary to meet the terms of the EverBank agreement. The sale of these investments is taking longer than originally anticipated.

Is the NetBank/EverBank deal in jeopardy? Apparently NetBank was not able to come up with the means to live up to their part of the deal. This is what else the NetBank site says:

EverBank remains interested in acquiring NetBank customers, and we continue to believe our customers would be well served by EverBank. If we consummate the EverBank agreement, we will let our customers know what to expect from an account conversion standpoint as early as possible. If the agreement is not consummated, NetBank expects to pursue another partner for its deposit relationships based on direction it received from its primary regulator.

I think that the key word here is "if". What does it mean to NetBank account holders? Mainly that your money may be in a state of limbo for a while longer. However, for NetBank (OTC: NBTK.PK) stock holders, your money is pretty much already lost, as I have said before. Note that NetBank is no longer listed on the Nasdaq, but now trades as a pink sheet stock.

DC

My First eBay Experience

Recently, I opened an eBay account and started bidding on items. Let me take a step backward for those who are not familiar with how eBay works. Before I opened an eBay account, I setup an account on PayPal which is like a bank account that you use to pay for eBay items. While it is not entirely necessary, most sellers on eBay prefer PayPal. One can also pay with a credit card, but PayPal is the entity that handles the transaction. So, I figured that I would have to end up opening a PayPal account anyway.

I was in the market to buy a Hewlett Packard 92274A (74A) toner cartridge for my 13 year old HP LaserJet 4MP printer. For the record, a new one of these replacement cartridges cost about $90 retail. On eBay I saw that they could be had for a lot cheaper, especially those that are designated as remanufactured cartridges. My first 4 or 5 attempts to buy a cartridge didn't meet with much success as I was outbid (sometimes at the very last minute) by somebody else. Up until this point, I had been bidding on cartridges one at a time. Frustrated by my lack of success, I started putting in bids on multiple items at once, hoping that I might be able to get one of them. To make a long story short, my bidding now became too successful, and I ended up winning two toner cartridges from the same seller. This is where the fun began.

I immediately tried to contact the seller to see if he would be willing to combine the shipping charges since most sellers do that when you win multiple auctions. There was no reply to my Emails after a couple of days. I then contacted eBay to see if I could get the seller's phone number. This is when I found out that his telephone was disconnected! Not a great first experience. So, I informed eBay, and they also could not confirm his contact information. For reference, when this happens eBay restricts the member's activities until the outdated contact information is corrected. I eventually got this updated info. So finally after several days, I did make contact with the seller, and he was willing to knock a few dollars off of the shipping. I then made my payment through PayPal.

What happened next was that I think the seller went on vacation or something. Again, there was no response to my Emails. *sigh* After another week or so, I made contact again, and he informed me that my goods had already been shipped. So, then it was up to UPS to deliver the goods. This also seemed to take forever, but in reality it took about 8 days.

In the end, about 3 weeks after the saga began (with setting up a PayPal account), I completed my first eBay purchase. This experience is certainly the opposite of when you just go into a store and walk out with the product you want. I did end up saving quite a bit over the $90+ I would have paid at say Office Depot. But, I wonder if it was worth the hassle. Since I consider this purchase from eBay a learning experience, I would say that it is interesting to learn how the mechanics of the system work. My new toner cartridge is now in my old printer, and I have one more cartridge to spare. These cartridges last me about 2 years each, so I'm set for a while.

I think I'll go looking for something else to buy now.

DC

Update on Office Depot Rebates

On April 27, I wrote about my experiences with Office Depot rebates. I did finally get all of my rebates, but not before a very long waiting period. I usually have good success with rebate offers for products that I buy. I estimate that I participate in maybe two dozen rebates a year, and have not had any problem 80-90% of the time. However, over the past year, I have sent in three rebates for products that I bought at Office Depot and had a problem receiving each one. If a problem happens with receiving a rebate, I usually consider it a fluke or coincidence. But since I had a problem three times in a row with the same retailer, I think that this is more than just a coincidence.

In each case, my rebate got "stuck" in their system. I waited almost half a year for a rebate on blank DVD media that I bought the day after Thanksgiving. I have talked to their customer service (at Web-Rebates.com), and they said that they would try to "expedite" the rebate. Most of the time, the rebate showed up as in the "Required Validation Period" in their online tracking system. In any case, Office Depot is now officially off my list of places of where I will shop for rebate items. Curiously, I have not had problems with other retailers who also use "Web-Rebates.com" for rebate submissions.

I have also heard from other readers who had the same problem with Office Depot rebates. In one case, a reader spent a great deal of effort, but it still took over 6 months to get the rebate check. That person no longer trusts Office Depot and immediately went to a bank to cash the $20 check, for fear that it would bounce. Does anybody else have a similar experience with Office Depot?

DC

Countrywide Bank SavingsLink

On PFStock, I have posted extensively about my experiences with NetBank. I have found a replacement for the funds that I withdrew from NetBank when I closed my account with them. The winner is ... Countrywide Bank.

Recently, I opened a SavingsLink account at Countrywide Bank. The highlights are that they pay 5.25% APY interest if you have more that $10k, and 5.4% APY if you have over $50k. The interest rate drops to 4.0% APY if your balance is below $10k. The account itself works like an ING or iGo savings account. If you are not familiar with these, the SavingsLink account is an online only account that must be linked to a regular savings or checking account that you have at another institution. This is pretty much the only practical way to transfer funds in or out.

Countrywide Bank actually has a branch within walking distance of my home. But unlike most regular banks, the branch doesn't have an ATM and a prominently displayed sign says that they don't have any cash in the branch. When I asked the asked the sole employee of this office how to make a deposit, he showed me a deposit envelope, which was actually a Federal Express envelope. Apparently if you give them a check, they will send by overnight mail to Texas where the deposit is processed. Countrywide did send me a few postage paid deposit envelopes, but I assume that the FedEx method would be faster.

The SavingsLink account doesn't come with either checks or an ATM card. So, most transactions have to go through your linked account. SavingsLink only allows one linked account at a time, and the process of linking an account is cumbersome. Countrywide Bank uses what is known as "trial deposits". When you request that they link an external account to your Countrywide Bank account, they will make two random deposits (of less than $1.00 each) to your external account and ask you to verify the amounts that were deposited. This is to assure that you are actually the owner of the external account, and this process usually takes 2-3 days to complete. One other little hassle is that deposits are subject to a 10 business day hold. This basically means that you won't be able to withdrawal any deposit for a period of two weeks.

In spite of a few hassles to setup a Countrywide SavingsLink account, their interest rates are much better than at NetBank. Indeed, the 5.4% APY rate is better than the vast majority of bank savings accounts available.

DC

This article was originally published on May 1, 2007. It is being republished today due to previous posting problems.

Bankruptcy and IVAs

In a discussion with one of the sponsors of PFStock, the topic of an Individual Voluntary Arrangement (IVA) was brought up. I was not familiar with IVAs, so I decided to do a little research into the topic. In the United Kingdom, when a person declares bankruptcy, the details of the bankruptcy are advertised in the local press.

Due to the Insolvency Act of 1986, individuals in the United Kingdom have an alternative if they wish to avoid bankruptcy. This option, called an Individual Voluntary Arrangement (IVA) , is an agreement between a debtor and creditors. The debtor agrees to pay a monthly sum, usually for 5 years, to their creditors through this arrangement. This sum is divided up between the creditors, who accept the sum in settlement of the amount owed.

The monthly payment is based on one's income and expenditure. In general, more than 75% (in value) of the creditors must agree in order for the IVA to be approved. A standing order authority (usually a company) will be set up to handle the payments.

An IVA might be suitable for people who cannot pay their debts. To read more about IVAs, I suggest the following website: Debt Advice Trust. The Debt Advice Trust is a not-for-profit charity in the UK with the aim of helping people get out of debt by giving free, impartial advice. The site has a forum and lots of in-depth FAQs on debt and staying debt-free.

Brokerage Survey Results

The results of PFStock's first brokerage survey are in. TD Ameritrade is the most popular brokerage among PFStock readers with 80% of the votes. The next most popular brokerage is SogoInvest with 20% of the votes. Thank you to all that voted.

In the latest poll, PFStock asks how much of your banking do you do online? Personally I do most, but not all, of my banking online. This leads to a lot of frustration when the bank website goes down. For example, yesterday when I got ready to pay a bunch bills on the Washington Mutual (WaMu) website, I got the following error message "Our site is temporarily unavailable due to a scheduled technology upgrade." So in the meanwhile, my bills are lined up next to the computer, waiting for WaMu's website to come back to life...

Please vote using the poll in the right sidebar.

DC

TD Ameritrade Online Documents

It seems that TD Ameritrade is having some issues with its online documents. For a while, my July online statements were not available online. The TD Ameritrade website had this notice regarding "July Statement Availability":

Electronic Statements for July are currently unavailable for some clients. We are working to make them available as soon as possible. We apologize for any inconvenience. If you have further questions please contact Client Services.

But a larger issue for me is that I am missing several of my trade confirmations from the May-June 2007 time frame. These are trade confirmations that were previously listed under the "History & Statements" tab, but mysteriously disappeared sometime last week. A couple of Emails and a call to TD Ameritrade APEX customer service assured me that they are "aware of the problem and expect to have this issue resolved quickly." Well, it has been more that a week and my trade confirmations have not yet reappeared.

Banks and brokerages encourage their clients to agree to online delivery of account documents in part because it saves them money in the form of printing and mailing costs. I don't know about you, but when I agree to the arrangement of having my documents kept online, I also expect to be able to access them whenever I want. TD Ameritrade is only one example, as I think that most people who bank online can describe a situation where they were unable to access the online system because it was "down for maintenance" or "undergoing system enhancements". Is it any wonder that many people are still hesitant to do all of their banking online?

Also, I thought that I would update readers on my TD Ameritrade Warning that the brokerage would start to charge for monthly paper statements. They recently posted the following information about "Former TD Waterhouse clients receiving paper statements":

Most former TD Waterhouse clients who received paper statements in their old accounts will now receive paper statements on a quarterly basis in their TD AMERITRADE account. There is no fee for quarterly paper statements. Statements are also available in electronic or monthly paper formats. Electronic statements are free, monthly paper statements are available for a $2 monthly fee (free for Apex clients). To change how often you receive statements or the format you receive them in, login to your account and go to My Profile (under Portfolio & Accounts), then select Statements (located in the Communication section) and click the "edit" link.

Since I'm an Apex client, I get my monthly paper statements delivered for free. I did notice that the new TD Ameritrade statements take about two weeks longer to arrive versus the old TD Waterhouse statements, which came quickly. However, if they I did charge me for statements, I would probably opt for only quarterly statements.

DC

AOL Time Warner Settlement

A couple weeks ago, I received a class action settlement check for some AOL Time Warner stock that I purchased a long time ago. In fact, the purchases of stock go back as far as 1999. To make a long story short, this settlement stems from the botched merger of America Online and Time Warner in which investors lost a lot of money. Time Warner currently trades on the NYSE as symbol TWX. Of course, the check that I received is much less than the amount that I lost trading the stock.

I filled in and mailed the proof of claim form for the AOL Time Warner class action settlement over a year and a half ago. Usually, these types of settlements are handled by a firm called Gilardi and Co. This is the first time I ever received a settlement check, and I've already figured out that these matters can take a long time. Has anybody else received a settlement for securities litigation? Do you know how one is supposed to report this on their taxes?

DC

NetBank Again

On the morning of September 20, 2006, I posted here that I was about to begin the process of withdrawing my money from NetBank and close my account with them. In that post, Sayonara NetBank, I referred to this process as "evacuating my money." There and in subsequent posts on PFStock, I cited deteriorating financial conditions at NetBank as one of my prime reasons for closing out my account. Even then, I conceded that NetBank was not likely to be forced into bankruptcy, but in the event that they did declare bankruptcy, it would be a hassle for depositors to get their funds back from the FDIC.

Let's take a look back over the last ten months at NetBank (Nasdaq: NTBK). On September 20th, the stock closed at $6.10. Today, NTBK trades at a mere $0.22 (and is on the verge of being delisted). And, NTBK recently reached an all-time low of $0.18 (a 97% decline). This decline is not surprising considering NetBank's deteriorating financials. From NetBank's previous press releases and other information available at their website, we can clearly see a series of quarterly losses over the past year. And early last year, NetBank stopped paying its shareholder dividend saying that they needed "to protect the company's capital base and tangible book value from further erosion."

Then on October 3rd, NetBank announced that it would be replacing its CEO. Even before this event, I had speculated that something fishy was going on at NetBank. A worst-case scenario could be that NetBank customers would need to recover their funds from the FDIC if NetBank becomes insolvent. However, I noted that while this is certainly possible, it is not the most likely case. Nevertheless, I asserted that NetBank could no longer remain competitive with other banks in its market space.

According to a more recent NTBK press release dated February 21, 2007, NetBank recorded a net loss of $202 million or $4.36 per share for 2006. This loss of $4.36 per share over the 12-month period is absolutely staggering when you consider that the entire company is only valued at $0.22 a share. Unfortunately, what is really lacking from NetBank's report is any type of good news. To further exacerbate the already existing problems, NTBK has received a notice from the Nasdaq Stock Market that the company's common stock is subject to delisting. NetBank has been delinquent in its regulatory filings because its former independent auditor resigned as of November 9, 2006. Since then, NTBK has been having difficulty bringing a new auditor on board. Again, this cannot be construed as good news.

And, the other shoe dropped on May 21st. NetBank announced that it is selling a substantial portion of what remaining assets it has to privately held EverBank. Here are a couple of statements from the NTBK press release:

The company has been under extreme financial pressure for more than a year due to a difficult mortgage origination market, a flat yield curve environment and other factors. These pressures have resulted in large operating losses that have significantly reduced the company's capital position and prompted heightened regulatory oversight.

And:

Regulators have been increasingly concerned about the bank's capital and earnings trends and advised management to find an alternative immediately that covered all of the bank's deposit obligations.

Doesn't this seem to imply that the aforementioned "regulators" forced NetBank to essentially liquidate its remaining assets in order to protect depositors' money? And the NTBK stock price has reacted very negatively to these developments.

So, what is left of NetBank? According to NetBank CEO, Steven F. Herbert, "Our remaining businesses will include our mortgage servicing operation, along with our retail prime mortgage franchise, Market Street Mortgage." My interpretation is that there won't be anything left of the online banking operation, after EverBank takes its share. So substantially I can say that as you and I know it, the online bank, NetBank is no more!

Further reading:
The Decline and Fall of Internet-only Banks
Unprofitable and Unstable, NetBank Ousts its CEO
More on NetBank
NetBank's Demise

DC

This article was originally published on April 15, 2007. It is being republished today due to previous posting problems. It has been updated.

Money Market Choices for TD Ameritrade

The series of posts that I made about my experiences with TD Ameritrade have been very popular at PFStock. Perhaps the most popular of my posts was the one where I exposed Ameritrade's "Hidden" cash sweep account. I have recently come across another cash (money market) option for TD Ameritrade account holders. This is another fund offered through "The Reserve" (website: ther.com).

The fund is called the Reserve Yield Plus Fund Class R (symbol: RYPQX), and is classified by The Reserve as an "enhanced cash fund". Currently, this fund pays in the neighborhood of 5.4% APY. This rate is much better than the default TD Ameritrade cash option which puts you in a sweep account that pays less than 1% interest.

However, unlike the other Reserve funds (offered through Ameritrade's Total Asset Plan) that I've talked about before, this fund is not available as a sweep option which automatically places your uninvested cash into a money market account. Instead it is traded like a No-Transaction Fee (NTF) mutual fund. You would need to put in a mutual fund order each time that you want to buy or sell the fund.

Now I have a few questions for my readers. Has anybody invested in this type of enhanced cash fund before? Do you need to report each mutual fund sale (each time you take money out of the fund) as a broker transaction on Schedule D of your tax return? Presumably, the fund tries to maintain a $1/share valuation, and each transaction would represent $0 in capital gains. And, does anybody know if TD Ameritrade would count each NTF transaction toward qualification for their premier (or APEX) trading status?

I suppose that I would be remiss if I didn't add that The Reserve Yield Plus Fund contains the following disclaimer:
This Fund is not a money market fund. Achievement of the Fund’s objectives cannot be assured. An investment in the Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the fund. Yields may vary.

Since the first time that I mentioned the Reserve Yield Plus Fund, I discovered that cash you have in RYPQX is not counted as funds available for trading by TD Ameritrade. Arguably funds held in RYPQX can be considered as cash, but not as "available cash" for the purpose of trading. TD Ameritrade only counts the cash sweep balance here. What this means is that if you want to buy a new stock and don't have enough money in your cash sweep, you will have to sell RYPQX before placing an order.

I think that TD Ameritrade made this process unnecessarily cumbersome. Because RYPQX trades like a mutual fund, there is a 1 day settlement period on funds. For stocks, the settlement date is 3 days later. So in theory, one should be able to execute a stock trade and then later liquidate enough fund holdings to cover the trade in time for settlement. However, the new TD Ameritrade website will not allow you to even enter an order if it thinks you don't have enough in your cash sweep. By my memory, the former Waterhouse website did not have this particular restriction on placing stock trades.

DC

This article was originally published April 11, 2007 . It is being republished because of previous posting problems. It has been updated.

Welcome to the New PFStock

I have finally gotten around to updating my blog template, and resolving the issues that I had with Internet Explorer 7 and the new Blogger Beta. I have tried to keep the same color scheme as the original PFStock. However, I have changed the underlying template. One interesting feature of my new template is that the blog post pane will resize itself depending on the size of the browser window. Also, it is much easier for me to add (or remove) list items on the side bar using the new Blogger template. For example, updating the blogroll or sponsors section is much easier than before.

This reminds me that I am still looking to add more blogs to my blogroll. If you have a bona fide personal finance blog, please Email me (my contact information is listed in the sidebar) about exchanging links. Note that I do not currently link to commercial, real estate, or multi-level marketing blogs. However, you are welcome to contact me about advertising rates for the sponsors section.

After Google converted PFStock to Blogger Beta, I had experienced some problems with the RSS feed. As a result, my readership at PFStock dropped. For the record, the correct RSS feed for PFStock posts is now http://pfstock.blogspot.com/feeds/posts/default or http://pfstock.blogspot.com/feeds/posts/default?alt=rss and http://pfstock.blogspot.com/feeds/comments/default for comments. Because of this and a few other posting problems, I plan to republish some of my blog posts that readers may have missed.

Lastly, I wanted to mention the addition of polls to PFStock. Currently, I am asking readers to vote on which brokerage they use. So far, TD Ameritrade is the most popular brokerage among PFStock readers. This is not surprising since I do tend to write a lot about that broker. Anyway, if you haven't voted yet, please try to get your vote in before the poll closes.

DC