We understand how important it is for you to feel confident that your assets are totally protected. Through our relationship with Ridge Clearing (the custodian of your account), assets in your Valet account are protected up to the total net equity in your account. SIPC* provides the first $500,000 of coverage (including $100,000 for cash balances). The additional excess SIPC coverage of unlimited net equity is provided by Travelers Casualty and Surety Company at no cost to you.

About Account Protection...

What account protection does Ridge Clearing provide?
Ridge Clearing provides account protection up to an account's total net equity. Specifically, the Securities Investor Protection Corporation (SIPC) provides up to $500,000 to protect the assets in each account you hold in separate capacity (for instance, joint tenant, sole owner, etc.). $100,000 of this amount covers between-investment cash balances. In addition, the Travelers Casualty and Surety Company provides secondary "excess" SIPC coverage of unlimited net equity with no cash limit.

What kinds of assets are covered?
Your stocks, bonds, mutual funds, notes, debentures, money market funds and certificates of deposit are protected in the event of losses resulting from your brokerage firm's insolvency or liquidation.

However, it is important to note that the account protection offered by SIPC and the Travelers Casualty and Surety Company does not protect against losses due to market fluctuations.

What is the Securities Investor Protection Corporation (SIPC)?
SIPC is a non-profit member organization of broker-dealers created in 1970 by an act of Congress. It protects customers of those broker-dealer members that for some reason cannot meet financial obligations to their customers.

Where does SIPC get the funds to protect me?
SIPC can draw on approximately $790 million of member contributions and interest earned from U.S. government securities. It also has a $1 billion line of credit with a bank consortium. And, if necessary, SIPC can also borrow up to $1 billion from the U.S. Treasury.

Is my cash account and my individual retirement account (IRA) protected separately?
Yes. Ridge Clearing has arranged for unlimited account net equity protection for each account in which you act in a different capacity.

How would SIPC satisfy my claim?
SIPC recovers all of the cash and securities it can from your broker-dealer -- then uses its own funds to satisfy any additional claims you may have.

What if I have more than $500,000 worth of securities and cash at risk?
If your remaining claim exceeds the $500,000 provided by SIPC (after the cash and securities recovered from your broker-dealer are returned to you), Ridge Clearing will use the additional protection offered through the Travelers Casualty and Surety Company to cover your securities -- up to the account's total net equity.

Is the coverage offered by my broker-dealer (through Ridge Clearing) affected by the S&L bailout?
Not at all. The Federal Deposit Insurance Corporation (FDIC) and the former Federal Savings and Loan Insurance Company (FSLIC) are responsible for compensating customers of liquidated banks and savings & loans. SIPC protection offered by broker-dealers is in no way connected with the S&L bailout or the FDIC.

*SIPC (Securities Investor Protection Corp.) insures the assets held in brokerage accounts if the brokerage firm fails. SIPC does not protect investors against investment decline or loss.