Ready to take full control of your Webull investments? Ever wondered if your stocks are being lent out without you fully realizing the implications? You're in the right place! This comprehensive guide will walk you through the process of turning off stock lending on Webull, step-by-step, ensuring you understand exactly what you're doing and why.
Stock lending, also known as securities lending, is a practice where brokers like Webull can loan out your fully paid-for shares to other investors or institutions. These borrowers typically use the shares for purposes such as short selling or to cover failed deliveries. While it can generate a small amount of passive income for you, it also comes with certain risks and can impact some of your shareholder rights.
Let's dive in and empower you to manage your Webull account exactly how you want it.
Understanding Webull's Stock Lending Program
Before we proceed with turning it off, let's briefly understand what stock lending entails and why Webull offers it.
What is Stock Lending? In essence, when you participate in a stock lending program, you're allowing your broker to "rent out" your shares. For this, you receive a small fee, often paid monthly. The key thing to remember is that you still own the shares. If the stock goes up in value, those gains are still yours. You can also sell your stocks at any time, even if they are on loan.
Why Does Webull Offer It? Webull, like many other brokers, offers stock lending as a way to generate additional revenue. They facilitate the loan between you (the lender) and a borrower, taking a cut of the fees. For you, the supposed benefit is earning a bit of extra income on your otherwise idle investments.
Potential Benefits (and why you might have opted in):
Passive Income: The most obvious benefit is the potential to earn a small amount of extra money on your existing stock holdings.
Utilization of Idle Assets: If you're a long-term investor holding stocks you don't plan to sell anytime soon, this could seem like a way to make those assets work harder.
Potential Risks and Drawbacks (and why you might want to turn it off):
Loss of Voting Rights: While your shares are on loan, you typically lose your shareholder voting rights. This means you can't participate in corporate actions like electing board members or voting on company proposals.
Counterparty Risk: Although often collateralized (meaning the borrower provides collateral, usually cash or highly liquid securities, to secure the loan), there's a theoretical risk that the borrower could default and fail to return your shares. Webull usually has safeguards in place, but it's a risk to be aware of.
Tax Implications: The income generated from stock lending is typically treated as ordinary income for tax purposes, not qualified dividends. This could impact your tax situation.
Impact on Short Selling: If your shares are being lent out, they might be used by someone to short sell that very stock, potentially contributing to downward pressure on its price. While this is a broader market dynamic, some investors prefer not to indirectly facilitate short selling of their holdings.
Step 1: Engage with Your Webull App and Log In
Alright, let's get started!
First things first, make sure you have the Webull app installed on your mobile device (iOS or Android) and that you're connected to a stable internet connection.
Are you ready to take charge of your investments? Let's do this!
Open the Webull App: Locate the Webull icon on your phone's home screen or in your app drawer and tap it to launch the application.
Log In to Your Account: You'll be prompted to enter your login credentials (phone number/email and password). If you have biometric authentication (fingerprint or face ID) enabled, you can use that for a faster login. If you've forgotten your password, use the "Forgot Password?" option to reset it before proceeding.
Once successfully logged in, you'll land on your personalized Webull dashboard, usually showing your portfolio summary and market data.
Step 2: Navigate to Your Account Settings
Now that you're in, we need to find the specific section where stock lending preferences are managed.
Access the "Menu" or "Profile" Section:
Look for an icon that resembles three horizontal lines (hamburger menu) or a person silhouette (profile icon). This is typically located in the bottom navigation bar or the top corner of the app screen.
Tap on this icon to open the main menu or your profile overview.
You're looking for the central hub of your Webull experience.
Locate "Account Settings":
Within the menu or profile section, scroll down and look for an option labeled "Account Settings," "Settings," or "Account Management."
Tap on "Account Settings" to proceed.
Step 3: Find the "Investing" or "Trading" Options
The "Account Settings" section houses various configurations for your Webull account. We need to pinpoint the one related to investment activities.
Identify "Investing" or Similar:
Inside "Account Settings," you'll see a list of categories. Look for a section related to your investment activities. It might be explicitly named "Investing," "Trading," or "Brokerage Account."
This is where the magic happens – where you control the nitty-gritty of your portfolio's operations.
Tap on the relevant option.
Step 4: Locate "Stock Lending" or "Securities Lending" Program
You're getting closer! Within the investing or trading settings, there will be an option specifically for the stock lending program.
Search for "Stock Lending":
Scroll through the options within the "Investing" or "Trading" section. You should find an entry clearly labeled "Stock Lending," "Securities Lending Program," or something similar.
Keep an eye out for this specific wording; it's the key to your goal.
Tap on "Stock Lending."
Step 5: Disable the Stock Lending Program
This is the crucial step where you'll switch off the program.
Toggle Off or Select "Disable":
Once you tap on "Stock Lending," you will likely see a toggle switch or an option to "Enable" or "Disable" the program.
If it's a toggle, ensure it's in the "Off" position (usually grayed out or to the left).
If it's a direct option, select "Disable" or "Opt Out."
Confirm your choice when prompted. Webull may ask you to confirm your decision, often with a pop-up warning about the loss of potential income. Read it carefully and then confirm.
Read and Acknowledge Disclosures (If Any):
Webull might present you with a brief disclosure or agreement to acknowledge that you understand the implications of turning off stock lending (e.g., you will no longer earn income from it).
It's important to read these disclosures to be fully informed.
Tap "Agree" or "Confirm" to finalize the change.
Step 6: Verify the Change
It's always a good practice to double-check that your settings have been updated correctly.
Revisit the "Stock Lending" Section:
Go back through the steps: Menu/Profile -> Account Settings -> Investing -> Stock Lending.
Confirm that the toggle is now in the "Off" position or that the status clearly indicates the program is "Disabled" for your account.
Confirmation Email (Optional but Recommended):
While not always guaranteed for every setting change, sometimes Webull sends a confirmation email for significant account updates. Check your registered email address for any such notification.
Congratulations!
You have successfully turned off stock lending on your Webull account. Your fully paid shares will no longer be available for Webull to lend out, and you will regain full shareholder voting rights if you previously lost them due to participation in the program.
10 Related FAQ Questions
Here are 10 frequently asked questions related to stock lending on Webull, with quick answers:
How to know if I'm currently enrolled in Webull's Stock Lending Program?
You can check by navigating to "Menu" -> "Account Settings" -> "Investing" -> "Stock Lending" in the Webull app. The status there will indicate if it's enabled or disabled.
How to re-enable stock lending on Webull if I change my mind?
You can re-enable it by following the same steps as disabling it: "Menu" -> "Account Settings" -> "Investing" -> "Stock Lending," and then toggling the option back to "On" or selecting "Enable."
How to contact Webull customer service if I encounter issues?
You can typically contact Webull customer service through their in-app chat support (often found in the "Help Center" or "Support" section) or by calling their support line, which can usually be found on their official website or within the app's help section. Their Canadian support line is 888-228-0958, and you can email support@webull.ca for Canadian accounts. For US accounts, check the Webull US website for direct contact information.
How to understand the tax implications of stock lending income?
Income generated from stock lending is typically considered ordinary income and is subject to your regular income tax rate, unlike qualified dividends which may have preferential tax treatment. It's always best to consult with a qualified tax professional for personalized advice.
How to know if all my stocks are eligible for stock lending?
Generally, only "fully paid" securities (stocks you own outright, not purchased on margin) are eligible for stock lending. Certain types of accounts or specific securities might also have restrictions.
How to check the income I've earned from stock lending on Webull?
Webull should provide statements or reports that detail any income generated from the stock lending program. You can usually find these in your account statements section within the app or on the Webull desktop platform.
How to verify if my voting rights are restored after disabling stock lending?
Once you disable stock lending, your voting rights for the corresponding shares should be automatically restored. You would then receive proxy materials for shareholder votes if applicable.
How to understand the collateral used in stock lending?
When your shares are lent out, the borrower typically provides collateral (often cash or high-quality government securities) to Webull, usually exceeding the value of the loaned shares (e.g., 102%). This collateral is held to protect you in case the borrower defaults.
How to know if disabling stock lending affects my ability to trade those shares?
No, disabling stock lending does not affect your ability to trade your shares. You can buy and sell your stocks as usual, regardless of whether they were previously part of the lending program or not.
How to learn more about the risks associated with stock lending?
Webull provides risk disclosures for its stock lending program. You can typically find these within the "Stock Lending" section of your account settings or by searching their help center for "Fully Paid Securities Lending Risk Disclosure."