How to sell the company shares you received without a trading account


The chance is, you didn’t make it to the management level without a decent portion of company stocks in your compensation package. When it’s time to break the bank, you can either open a trading account at your local brokerage, or, alternatively, use a one off trade (“OOT”) service to skip all the hassle of opening and managing a trading account. This is especially helpful for those who don’t intend to get into trading or invest in the stock markets.

Most of the full service brokerages offer the one off trade service, often called “Sell Only Service”. The one off trade is a very straight-forward process, the brokerage does all the work for you once you hand in the proper documents. You often don’t even have to be a customer of the bank or brokerage to take advantage of the service. In exchange, a fixed price or a certain percentage will be charged as a commission, this commission usually starts from somewhere between $60 to $100.

 As simple as the one off trade service sounds, the service is, however, not for just any share, the shares you wish to sell must be issuer sponsored; this means the shares were issued directly from the company, not from prior trading activities. Furthermore, the shares must be of a publicly traded company.  These shares are commonly obtained through employee pay schemes, investment in company floats…etc.

When you receive issuer sponsored shares, the legal title is electronically registered and maintained by a share registry, whereas when it comes to brokerage sponsored shares, also known as CHESS (Clearing House Electronic Subregister System) sponsored shares, the shares are registered with a stock brokerage. You may receive a Security Holder Reference Number (SRN) for your issuer sponsored shares, note that each company’s shares will have their own SRN; if you own issuer sponsored shares in 3 different companies, you then may have 3 different SRN numbers. This is also one of the key differences that can help you identify your issuer sponsored shares from CHESS sponsored shares, as all your CHESS shares may only have one Holder Identification Number (HIN), allocated by your broker.

The SRN number is a ten to eleven digit that begins with an ‘I’, this number can be found in a holding statement or any communication document between you and the share registry. HIN numbers begin with an ‘X’, this number is shown on your account details.

 Once you confirm that your shares are indeed issuer sponsored, it is pretty straight forward from there. After you select a broker, you will be required to provide identification and other relevant documents, and that’s pretty much the only thing you have to do for the entire process. Note that this could potentially be a lengthy process, depends on the market condition, so make sure you factor in extra time in your expectations.

 If you’re looking to offload your issuer sponsored shares, make sure you carefully compare prices between brokerages before you go with a brokerage. For example, comparing to ANZ , CMC markets offer a very competitive pricing structure.

Other than the prices, it is also important to choose a reputable and experienced brokerage, as they tend to have more resources when it comes to trading; also make sure that the brokerage of your choice is regulated by a major oversight body in the government. For example, in Australia, The Australian Securities and Investments Commission (ASIC) is the major oversight body that supervise real-time domestic trading and Australian Financial Service License (“AFSL”) holders.



Guest Writer on Business and Success

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