Have you ever wondered if your Webull holdings are secretly working for someone else, earning your broker money while you potentially lose out on certain benefits? If you've got stocks sitting in your Webull account, there's a chance they're part of the "stock lending" program, also known as Fully Paid Securities Lending (FPSL). While it can offer a small income stream, it also comes with certain considerations you might want to avoid. This comprehensive guide will walk you through, step-by-step, how to disable stock lending on Webull and regain full control of your shares.
Understanding Webull's Stock Lending Program
Before we dive into disabling it, let's briefly understand what stock lending is. In essence, it's a program where Webull can borrow your fully paid-for shares and lend them out to other investors (typically institutional investors or short sellers). These borrowers pay a fee for the privilege, and a portion of that fee is sometimes shared with you, the original shareholder.
Why do brokers do this? It's a way for them to generate revenue from idle assets. For borrowers, it's often to facilitate short selling (betting on a stock's price to fall) or to cover failed deliveries of securities.
While earning a little extra income might sound appealing, there are some important implications of participating in stock lending:
Loss of Voting Rights: While your shares are on loan, you typically lose your shareholder voting rights for those specific shares. This means you can't participate in important company decisions.
Tax Implications for Dividends: Any dividends you receive on loaned shares are often treated as "payments in lieu of dividends" or "manufactured dividends." These are usually taxed as ordinary income, which could be at a higher rate than qualified dividends.
Loss of SIPC Protection: Crucially, while your shares are on loan, they are not covered by SIPC (Securities Investor Protection Corporation) insurance. While Webull generally holds collateral (usually cash) for the loaned securities, there's a theoretical counterparty risk if the borrower or the lending agent defaults.
If these concerns outweigh the potential for a small income, then disabling stock lending is the right move for you. Let's get started!
Step 1: Engage and Log In! Are you ready to take back control of your Webull investments?
The first and most crucial step is to access your Webull account. Whether you're on your mobile device or desktop, ensure you have your login credentials handy.
Sub-heading: Accessing Your Webull Account
On Mobile (Webull App):
Open the Webull app on your smartphone or tablet.
Enter your
login credentials(username/phone number/email and password).If you have two-factor authentication enabled (which you absolutely should for security!), enter the verification code sent to your registered device.
On Desktop (Webull Website):
Navigate to the official Webull website (
www.webull.com Click on the
Loginbutton, usually located in the top right corner.Enter your
login credentialsand anytwo-factor authenticationcodes requested.
Once you're successfully logged in, you'll be greeted by your Webull dashboard. Take a moment to familiarize yourself with the interface if you haven't already.
Step 2: Navigate to Your Profile and Account Settings
Now that you're in, we need to find the specific section where you can manage your account preferences, including stock lending.
Sub-heading: Finding the "Profile" or "Menu" Section
On Mobile (Webull App):
Look for the "Menu" icon, often represented by three horizontal lines or a "burger" icon, usually in the bottom right corner of the screen. Tap on it.
Alternatively, you might see a "Profile" icon (often a silhouette of a person) which will lead you to your account details.
On Desktop (Webull Website):
On the web version, your profile or account settings are usually accessible from your
usernameor aperson iconin the top right corner of the screen. Click on it.
This action will open a side menu or a new page displaying various account-related options.
Step 3: Locate "Account Settings" or "Investing"
Within the menu you've just accessed, you'll need to find the section dedicated to your account settings or investment preferences.
Sub-heading: Drilling Down to the Right Options
On Mobile (Webull App):
Scroll through the options until you find "Account Settings" or simply "Settings." Tap on it.
Within "Account Settings," look for a category like "Investing" or "Trading."
On Desktop (Webull Website):
After clicking on your profile, you'll typically see options like
Account Management,Settings, or similar. Select the one that leads to your account preferences.Once in the account preferences, look for
InvestingorTradingrelated settings.
The exact wording might vary slightly with app updates, but the general path remains consistent: Profile/Menu > Account Settings/Settings > Investing/Trading.
Step 4: Find "Stock Lending" or "Fully Paid Securities Lending"
You're getting closer! Within the investing or trading settings, you'll find the specific option to manage the stock lending program.
Sub-heading: Identifying the Stock Lending Option
Look for an option explicitly labeled "Stock Lending," "Fully Paid Securities Lending," or something similar. It might be accompanied by a toggle switch or a button indicating its current status (e.g., "Enabled" or "Disabled").
Pay close attention as some platforms might use slightly different terminology. The key is to find the option that deals with your shares being lent out.
Step 5: Disable the Stock Lending Program
This is the moment of truth! You'll now take the action to turn off stock lending.
Sub-heading: Toggling Off the Feature
Once you've found the "Stock Lending" option, you should see a toggle or a clear button to disable or turn off the program.
Tap or click on this toggle/button.
Webull may ask for a confirmation. Read any pop-up messages carefully to understand the implications of disabling the program (which we've already covered, but it's good practice to confirm).
Confirm your decision if prompted. You might need to enter your trading password or a verification code for security purposes.
Step 6: Verify the Change (Crucial!)
Don't just assume it's disabled. Always verify that your changes have been successfully applied.
Sub-heading: Confirming Your Settings
After disabling, navigate back to the "Stock Lending" section.
The status should now clearly indicate that it is "Disabled" or "Off."
It's a good idea to check your account details a day or two later to ensure the change has fully propagated through the system and that none of your shares are listed as "on loan." While the change should be immediate, a quick double-check provides peace of mind.
Step 7: Understand the Immediate and Long-Term Effects
Now that you've disabled stock lending, let's quickly recap what this means for your account.
Sub-heading: What Happens Next?
Immediate Effect: Any new shares you acquire will not be eligible for the stock lending program.
Existing Loans: If you had shares currently on loan, Webull will typically recall them. This process might take a business day or two to fully complete. You won't earn any more lending fees on those shares.
Regained Rights: You will regain your shareholder voting rights for any shares that were previously on loan once they are recalled.
Dividend Treatment: Future dividends on your shares will be treated as standard qualified dividends (assuming they meet the IRS criteria), potentially offering a more favorable tax treatment.
SIPC Protection: Your fully paid shares will now be fully covered by SIPC insurance (up to the standard limits), providing an additional layer of security.
Frequently Asked Questions (FAQs)
Here are 10 common questions related to disabling stock lending on Webull, with quick answers:
How to check if my stocks are currently being lent out on Webull?
You can usually check the status of your individual holdings within your portfolio on Webull. Look for notations or details next to your stock positions that indicate if they are "on loan" or participating in the lending program.
How to re-enable stock lending on Webull if I change my mind?
You can re-enable stock lending by following the same steps (Profile > Account Settings > Investing > Stock Lending) and toggling the option back to "Enabled."
How to know if I'm eligible for Webull's stock lending program?
Eligibility typically depends on your account type (e.g., cash or margin account) and meeting certain requirements set by Webull. Generally, fully paid securities in eligible accounts can be lent out.
How to understand the risks of stock lending on Webull?
The primary risks include losing SIPC protection on loaned shares, potential adverse tax treatment of dividends as "payments in lieu," and the temporary loss of shareholder voting rights.
How to contact Webull customer support if I have trouble disabling stock lending?
You can usually contact Webull customer support through their in-app help center, email (e.g., support@webull.ca for Canada, check your regional Webull website for specific email), or sometimes via a direct phone line during market hours.
How to determine if stock lending is right for me?
Consider your investment goals. If maximizing every penny of income is paramount and you understand the risks, it might be an option. If you prioritize full control, voting rights, and SIPC protection, then disabling it is likely better.
How to receive the income from stock lending on Webull?
If you participate, any income earned from stock lending is typically paid out to your Webull account on a monthly basis.
How to know the percentage of fees I receive from Webull's stock lending program?
The percentage of lending fees shared with you can vary and is often outlined in the terms and conditions of Webull's Fully Paid Securities Lending program. You may need to review their specific disclosures for exact figures.
How to ensure my shares are fully returned after disabling stock lending?
After disabling, Webull is typically obligated to recall any loaned shares. You can monitor your portfolio in the days following the change to ensure the "on loan" status is removed from your holdings.
How to find the official Webull policies on stock lending?
You can usually find detailed official policies and disclosures regarding Webull's Fully Paid Securities Lending program on their website, often in the "Legal Documents," "Agreements and Policies," or "Disclosures" sections.
