Trading 212 have just made another blunder to add to a whole series of issues this year.
This time Trading 212 have decided to actively promote investments in Chinese companies to their ISA customers.
Which is interesting because stocks trading on Chinese stock exchanges are not normally allowed inside ISAs.
And there are very good reasons why. However Trading 212 have added new ETP products which allow customers to bypass these restrictions.
But not only that - Trading 212 have decided to aggressively promote these products as well despite there being a lot of question marks.
It is somewhat odd for a broker to suddenly be promoting products like this, especially when they haven't promoted any other stocks in this way since I became a customer about a year ago.
On top of this, Trading 212 seem to have completely contradicted themselves while trying to refute concerns I have previously raised.
And at the same time they encouraged people to attack me for daring to raise the issue.
And this is really not a good look.
In this video I will show exactly what the inconsistencies are and explain why they really do matter.
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This time Trading 212 have decided to actively promote investments in Chinese companies to their ISA customers.
Which is interesting because stocks trading on Chinese stock exchanges are not normally allowed inside ISAs.
And there are very good reasons why. However Trading 212 have added new ETP products which allow customers to bypass these restrictions.
But not only that - Trading 212 have decided to aggressively promote these products as well despite there being a lot of question marks.
It is somewhat odd for a broker to suddenly be promoting products like this, especially when they haven't promoted any other stocks in this way since I became a customer about a year ago.
On top of this, Trading 212 seem to have completely contradicted themselves while trying to refute concerns I have previously raised.
And at the same time they encouraged people to attack me for daring to raise the issue.
And this is really not a good look.
In this video I will show exactly what the inconsistencies are and explain why they really do matter.
💵 GREAT UK INVESTING APPS I USE
GET A FREE SHARE WORTH UP TO $150 WITH STAKE
https://hellostake.pxf.io/qnA3xq
You will get a free share if you sign up using this link and deposit a minimum of £50.
GET A FREE SHARE WORTH UP TO £200 WITH FREETRADE
https://magic.freetrade.io/join/sasha-yanshin
You need to sign up and make any deposit to get the free share.
SIGN UP FOR ETORO
https://med.etoro.com/B15358_A95689_TClick_SSasha.aspx
67% of retail investor accounts lose money when trading CFDs with this provider. Your capital is at risk. Other fees may apply.
👍 SUBSCRIBE TO MY CHANNEL
https://www.youtube.com/c/SashaYanshin?sub_confirmation=1
DISCLAIMER: Some of these links may be affiliate links. If you purchase a product or service using one of these links, I will receive a small commission from the seller. There will be no additional charge for you.
DISCLAIMER: I am not a financial advisor and this is not a financial advice channel. All information is provided strictly for educational purposes. It does not take into account anybody's specific circumstances or situation. If you are making investment or other financial management decisions and require advice, please consult a suitably qualified licensed professional.
Hey guys, it's sasha trading212 have just gone and done yet another blunder to add to a whole series of issues they've been having this year, so i thought it's time to go and talk about all of these things together in this video, i'm going to cover trading 212's latest own goal some misinformation and has been coming out over the last few weeks and months and some things that have been happening behind the scenes. I know that a bunch of trading212 fans are going to descend onto this video smashing the dislike button and leaving some nasty comments. All i ask is maybe try and watch the video first. You might just pick up on something somewhat interesting.
So first, let's talk about this latest blooper you see, trading212 have been sending out some promotional emails and proudly announcing that neo is now available in their isa accounts along with a bunch of other chinese stocks. Now i get that neo is a popular stock, but here is the big problem for me: stocks that trade in china are expressly not allowed inside isa accounts. You see, isis have more protections and restrictions than regular investing accounts and only companies that trade on a recognized exchange can be inside a stocks and shares isa as well as some other restrictions. Now, if you look down the list of these recognized stock exchanges, no chinese exchanges are on that list.
If we don't count hong kong - and there are good reasons for that - chinese companies have a number of restrictions, including specific restrictions on foreign ownership and people who think that they are investing in these chinese stocks are actually not investing in the company that they think they Are the shares that are being purchased are in adrs? These are american depository receipts and not the actual underlying shares of the company, and the problem is that these adrs are not even equivalent to the shares in the business. These adrs are equivalence papers to shares. In a shell company, typically based in a tax haven like the cayman islands, that shell company then owns a bunch of other entities that then own some other entities that maybe at some point further down that chain have a contractual, a relationship with that chinese company. But the shares that you are buying in that adr that equates the shares in the cayman islands.
Company are just that you do not have any direct or even indirect ownership of the actual chinese company that you are investing in. You have no rights to their future cash flow distributions. You are not a shareholder, and at any time the chinese government could go and declare these ownership structures to be in breach of their foreign ownership rules, which would effectively wipe out your entire investment in that company investment in literally a second one giant drug pool is Completely possible because remember you don't actually own any shares in those companies and don't just take my word for it for this level of risk. Gary gensler, the chair of the sec in the us, has recently said. I worry that average investors may not realize that they hold stock in a shell company rather than a china-based operating company. The sec has been highlighting the risk this risk a lot in the last few weeks. So why is all of this important? Well, there are good reasons why these sorts of investments in chinese companies are not available in the uk in isis, but trading 212 have gone and added these new products by a company called leverage shares to get around this issue. You see these traders etps.
Basically, the same as etfs that only really carry one company, so this etp exists so that you can go and buy shares and companies that are not allowed to be in your isa, basically to circumnavigate the law and that's the only real reason why you would ever Go and invest in the one neo etp, which has a one-to-one leverage instead of well. You know just buying neo shares so that you can buy those shares in your isa and with this setup the chain gets even more ridiculous and longer so you can buy these etp shares and the company you've never heard of that then convert into these adrs that Have an equivalence relationship with shares in a holding cayman islands, company that owns some other entities, blah blah blah blah blah you can hear you can hear how it sounds right now if somebody wants to invest their money into that sort of stuff, that is up to Them i am not going to tell them they shouldn't or they can't if they understand the risks and they think that it's worth it all power to them, but not only did trading 212 add these etps to the isa product. They are now actively promoting them to their customers. I haven't seen them actively promote any other companies or investments.
In this way i actually went and checked and other than a cfd promotion. I haven't seen a single other email about any other companies, but this time i didn't only get one. I got two emails about these new chinese stocks being available in isis as well as promotion on social media, and i think that is rather odd. I am going to leave it at that now.
Let's take a step back and look at what trading 212 has been doing in 2021. First, trains want to go and make a big public statement in january saying that their business is profitable without charging any fees and how proud they are of that they don't need to charge fees like everybody else. At the same time, they're running ads that say that all other brokers are greedy because those other nasty brokers they do charge fees, go ahead. Skip this ad.
Those fat cat commission takers wouldn't want you to see it. They wouldn't want you to see how they bathe. In a bathtub made of gold filled with gold, even the sink plug is gold. That ad is still at the top of their youtube channel in case you're interested now, a few days later after this big publication, they stopped newer, cam registration, citing technical, upgrade issues a month later at the beginning of march. They then go and update their terms and conditions and add foreign exchange fees in the process. Three months after that, on the 17th of june, they update their terms, conditions again and then less than two months later on the 7th of august just a few days ago. They go and update their terms and conditions for the third time in five months. The big question is what the heck is going on in trading 212.
That needs three terms and conditions updates in five months and it's not brexit. It's not anything else, because no other broker seems to need to do monthly updates. Some of the changes in the most recent update seem to be updating changes that they only made a few months ago. It just seems so odd and for me, racist questions do trading 212 know what they are doing.
Some things seem to be changing in the background, without any public announcements whatsoever, because you know you don't want bad publicity. Tony from trading, one two confirmed in a post a few days ago on the community forum that it is not possible to create new accounts with dollars as the base currency, something that was possible before, of course, that has nothing to do with trying to milk their Customers for foreign exchange fees, that removal was also probably for technical reasons. Then there's the big question mark on why new accounts were suspended for most of the year uh. Just until a few days after the founders of the business deposited 20 million pounds into the business account in the last few weeks when the new accounts were first suspended, trading 212 said that it definitely had nothing to do with cash flow.
So i guess this is again just a completely random coincidence, and then there was last week. I dared to point out that a clause in the trading 202 terms conditions seems at odds with regulatory requirements now fca's rules that brokers have to abide by are pretty clear. But after i point this out, i got a load of abuse and trading. Two themselves came out with a statement saying that i am wrong.
Unfortunately, training 212 seem to have completely contradicted themselves in that very statement so which is correct, the terms and conditions or tony from their community forum. The clause in reference is 13.10 and i'm not going to go away from this. I'm just going to quote the complete contradictions to you, so you can decide for yourself whether they are saying the same thing or maybe they're saying the exact opposite. The clause says because of the nature of applicable laws or market practices in certain overseas jurisdictions, blah blah blah blah your investments may not be segregated and separately identifiable from the investments of the firm or custodian and whose name your investments are registered.
Now read that again it says your investments may not be segregated and separately identifiable from the investments of the firm, under some circumstances that firm being traded into one two now tony in his public response, which obviously proves that i am wrong in highlighting this issue said We would like to stress that all client assets are held in clients, omnibus accounts segregated from the assets of trading 212, uk limited so which is it? Are they segregated at all times as tony says, or are there times when they might not be because that is what the statement in the terms condition says, and they are exactly the opposite. Now part b of the same clause says as a consequence, in the event of failure, your investments may not be as well protected from claims made on behalf of our general creditors and tony's response says at all times, trading 212 uk limited complies with all relevant rules Under cash 6., cash 6 is the regulation that the fca have for this, and the cash 6.2 says a firm must when holding safe custody assets belonging to clients, make adequate arrangements so as to safeguard clients, ownership rights, especially in the event of a firm's insolvency. So are the clients, ownership rights in the case of trading to one two's insolvency safeguarded as the regulations say or are the terms and conditions right, because the terms and conditions, i'm going to repeat it again say in the event of a failure, your investments may not Be as well protected from claims made on behalf of our general creditors. Now there is zero interpretation here, i'm literally just reading out word for word the terms and conditions that trading 202 have published and then reading you the response that says that my concern is misplaced and the two seem to be completely at odds with each other. So perhaps next time, trading 202 can look at the issue being highlighted and not encourage personal attacks on the person who brings the issue up. That would be a good place to start, maybe it's time for our fourth update to the terms and conditions, because you know three just wasn't enough. I hope you guys found this video useful. Thank you so much for watching.
I really really appreciate it. If you do enjoy this kind of stuff, please don't forget to smash the like button to counter all the dislikes that i'm about to receive. Thank you. So much and i'll see you guys later, you.
you clearly have advice to impart but please pause at the end of a sentence .. Not that you give a toss but I find it hard to comprehend what you're saying without reasonable punctuation .. your not the only person who does this which gives me the impression your all reading some crap presenting nonsense which advises avoiding dead space broadcasting which thencomesacrossasincomprehensible diatribe …. other than that great content in sure.
I cant find this T&C in the exact form can you pass me the link or pdf somewhere?
Important trading 212 can sell your shares without Your permission if the Company you’re invested in is taking place in a merger You will not receive the shares to the value of the new company instead they will Sell your shares at market value of the company you have shares with . Unfortunately this happened to me when SPRT merged with GREE Unfortunately like many of you know SPRT sold off very heavy and my $15 shares were sold for $4 taking a massive hit of over $1000 please be aware As it’s a very expensive lesson to learn ,
Well I was just planning to invest my first money with Trading212 according to some recommendations then I watched your last two videos about Trading 212 and I am little bit confused, not sure if I should go for it or look out for a different broker or wait for the damn crash everybody is talking about for the last year .. I am stuck.
& the Chinese market has now just taken a dip ??????
OK so I'm new to investing and this video raised allot of questions in my mind regarding Trading212. From your perspective, what's the "safest" trading broker out there?
Hey it let's you join if you select any other country other than UK.. say you I the UK and they say they aren't taking anybody on… try any other country and it let's you sign up ??
I'm looking for a service like M1 Finances from USA working in EU and trading212 was the only one (pies, autoinvest etc) working that way in EU. SO I was very happy to find them for a year or so. But their actions don't look very serious for me. I'm not ready to risk potentially hundreds of thousands of euros. Hopefully trading212 can do better in future! Bcs things like choosing bank in Bulgaria, which is still highly corrupt and have weak customer protections. Brokerage account hosted on Cyprus, banks in Bulgaria, Company hosted in UK. Looks like unbelievable amount of paperwork and regulations to be covered.
There absolutely scumbags, asked can I get upgrade to proper leverage (I know the risks , its my money) but these clowns are all against it, you need 500k traded, and a few other mad requests,
Hi Sasha 212 isn’t covering 85k look video from Ben motivation2invest 🤭😬😱 that worries me what you think about it let’s as known.thanks for doing great videos 🤣👌😉
Great stuff luckily I haven't got a 212 trading account yet
Totally agree, FCA regulations around client accounting has to have segregation of client and business funds. If this is not the case and an insolvency event occurs you would have the same situation as Lehman Brother crash, where client and business assets could not be seperately identified. This is why no one received the protection they should have.
I'm lucky enough to have never engaged in any business with Trading 212. From all the chatter on the subject over the last several months, I've come to the conclusion that they can't organise the proverbial booze up in a brewery. I'm surprised people are still making videos about it. Surely by now anyone with half an ounce of sense knows not to touch them with a barge pole.
Hey Sasha, I'm new to your channel and love your honest content.
So are you still using Trading 212. I'm looking for a platform for my ISA accounts. Thanks
Thank you Sasha. I'm glad to have found this channel. You're asking all the right questions. It would be good if the sleepy FCA could wake up and take a look at the situation.
Keeping it real …. and honest can only applaud …… 🙌🙌🙌👏👏👏
Hello to all reading this reply.
I emailed trading 212 on this clause. 13.10 After watching your video about the clause. Along with watching others.
I understand the confusion and concerns.
I am NOT a financial advisor. But basically you have to research your own investments. Which I do. And it’s really down to the individual how and where they decide to put their money.
If you do not trust a bank or any company holding your hard earned money. You could easily put it under your bed but how safe would that be. So where every you decide to hold your money. There is always a risk!!!
Now!!! I can not say for certain and this is just assuming and my own personal thought as why you should do your homework before you invest into any companies, banks, institutions etc.
Personally I think this only actually applies to if your holding more than £85,000 in 212 accounts.
Very similar to if your hold money in a UK bank. UK protect your investments.
Example:
So if you had £50,000 in your bank account and you had £50,000 in an isa account using trading 212. So basically your total holdings in the UK is £100,000 and somewhere someone holding your funds defaulted, you only be paid back to cover you up to £85,000 from the UK government.
Trading 212 are probably just highlighting they do not hold your money. According to the clause so they are not liable.
So personally anyone who holds more than £85,000 in total, the UK government only pay this amount. If you hold more and there is plenty of UK accounts holding more than £85,000. You lose the rest more than likely as the funds held would pay off its creditors first.
It’s highly unlikely the whole of these accounts would go bust. Think that’s what a lot of concern about this topic is…..
Lets say if your holding more than £85,000 in any account of trading with 212.
Trading 212 hold the shares only. The broker they use hold the funds, which then I think is placed into a segregated account for your investment. Maybe by another party ie a bank etc. But the issue you do not know who is holding your funds. So this raises alarm bells. It wouldn’t make any difference I do not think, because your going through 212 platform your protected upto £85,000 regardless which bank and its countries it’s deposited into.
Trading 212 informed me….
“We hold the shares you invest in on your behalf. Whenever you invest with Trading 212, your equity is held in custody at Interactive Brokers. They are the biggest broker in the world by the number of daily trades, holding 160B US dollars in client assets. All of your assets are protected, regardless if they are UK or US stocks.”
Let’s say you held £1,000,000 in an UK bank.
The bank have informed you and gave you a written set of clauses you sign. If they went bust you be covered by £85,000. The rest of your money is paid to its creditors.
So I think this clause 13.10 is probably no different to your normal UK banking regulations clauses.
So if trading 212 or it’s broker it uses went bust you protected similar to UK banking rules.
If you have any other concerns over this. You can probably contact the FSCS for information on the clauses set.
You are very correct that Chinese investment are not aloud in your isa account. But I think you can hold them in your investment account. It’s probably to do with the tax haven rules in the UK.
Again I would say research this.
Hope this information helps.
You’re just spitting out your dummy because they banned you from the forums
I've stopped adding money to my T212 account, but I sure hope they will add the ability to move assets to the brokers.
from now on I'm on IBKR.
I am glad that they weren't opening new accounts when I tried a few months ago. Feels like a huge dodged bullet
I believe FRC insure accounts up to £80k so at worst never have more than 80k in brokers like T212
I was really patient and willing for them to come back but unfortunately they seem too unstable for me and the fact they consistently keep contradicting themselves with their updates makes me a bit anxious. I think I might go for vanguard instead or freetrade. As someone who is new to investing Vanguard seems very protective and stable to me
Your hatred of Trading 212 is very entertaining – do you have a personal grudge against one of the shareholders or something?!
Adequate does not mean guarantee. This is why 212 likely use the wording they do. But it’s not the first time they’ve tried to dismiss their terms. This issues was brought up last year and they said the same thing. Bottom line terms and conditions always trump random forum comment from an ‘employee’. 212 give no guarantee your assets are separate from 212 assets and never have no matter what their employees try to say.
Thanks for raising these points. I want to point out that if you’re classed as a professional investor, your money is not segregated and therefore at risk.
Thanks for the informative video's Sasha! On a side note would a company like the uk company interactive investor (ii) who charge a flat fee of 10 pounds per month for our ISA accounts be any safer? Any opinions on this? Cheers
Sasha, could you please do a video on endeavour silver . Thanks
The best spin ayone can put on this is that the management of T212 is incompetant and not fit for purpose. Doesnt seem like somewhere I want to put my money.
The ending got really strange, did they really encourage personal attacks to you Sasha?
Hi Sasha, do you think it is getting to the stage where you would suggest looking at alternative isa providers? I keep quite a lot of money (to me) in 212 so want to make sure my money is in safe & competent hands! Thanks as always
Cracking video Sasha. It would be interesting if you could do a video comparing with other platforms on the issues of the safety of there investments. Keep up the good work Sasha.
It would be interesting to compare the wording of T212 with eToro, FreeTrade, or Stake… to see how they couch the ownership and protection.
Hi Sasha, what is the alternative to Trading 212 then?