Some definitions
I have been asked to define a few of the terms I list, mainly for the benefit of newer investors, so:
ACAT Out
ACAT transfers are electronic transfers normally used to move one's entire account from one broker to another. The broker from which you are transferring your account will usually (but not always) charge for this service. Sometimes this charge seems rather high, and you can view it as your current broker's way of punishing you for transferring your account to another broker.
ACH Transfer
ACH stands for Automated Clearing House, a network used for electronically transferring money between financial institutions in the United States. As implemented by brokers, the procedure is normally as follows: One signs and submits a signed authorization to the broker. After it is approved, one can transfer funds to or from the broker to one's bank or other financial institution by making a request either on the broker's website or by phone. ACH transfers are more convenient and often much faster than moving paper checks from place to place, and are often free. On the other hand, they are not as fast as "wire" transfers, such as SWIFT and FedWire, and sometimes have a lower maximum than wire transfers on the amount which can be moved under a given request.
Add liquidity/Reduce liquidity
(The best explanation of these concepts which I have found is here.)
DTC Out
A DTC transfer is the transfer of one or more securities from one broker to another using the brokers' electronic transfer system. Most brokers charge you to transfer a security out to another broker, but not to accept an incoming transfer from another broker. The various brokers mark the fee "per position", "per request", etc.. I suspect that all of these expressions mean the same thing, but I decided that it would be safer to copy their language.
Tender Fee
A tender offer is an offer from the issuer to buy back a security directly from the holder. It is often (but not always) to the investor's advantage to accept the offer. The tender fee is a fee charged by the broker to execute this transaction. Brokers will often charge the same fee for other kinds of "voluntary reorganization", and a few brokers charge as well for mandatory reorganizations, such as the conversion of mandatory convertible securities.


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Last updated: December 15, 2010 Home.