Moving forward together

Morgan Stanley will be assuming responsibility for the custody and clearing services provided by E*TRADE Securities. Here's what you need to know.

As you may know, E*TRADE and Morgan Stanley joined forces in late 2020. We’re now entering a new phase of our journey together and are excited to share with you what’s next.

Morgan Stanley Smith Barney LLC (Morgan Stanley) will soon be assuming responsibility for the custody and clearing services currently provided by E*TRADE Securities LLC (E*TRADE). As a result, your E*TRADE account(s) will be transferred to Morgan Stanley over the coming months. We’ll notify you as your transfer date approaches—and will keep you informed every step of the way.

No action is required on your part for this transfer to take effect. You will continue to enjoy the online experience you’ve come to expect from us, including the E*TRADE website, mobile apps, trading platforms, and customized product features.

Please note: Account transfers will occur on a rolling basis. To find the transfer date for your account(s), see the Notice of Changes that was sent to your email or home address. If you haven’t yet received this communication, your transfer date is not immediately upcoming.

About 1 week before transfer weekend On the Tuesday before transfer weekend On the Friday of transfer weekend

All outgoing account transfer requests will be rejected and will need to be resubmitted (using your new account number) after transfer weekend.

You will no longer be able to change your sweep option until after the transfer has been completed.

Processing of all incoming account transfer requests will be paused until after transfer weekend. Starting after the close of extended hours trading, all open orders except futures will be canceled, and online account access will be disabled through Sunday afternoon. This could also impact your access to any banking accounts you hold with us, as well as the availability of certain banking and cash management features. Debit and ATM cards, however, will remain fully functional. Learn more about what to expect before the transfer weekend.
 

To facilitate the transfer of your account(s), online account access will be temporarily disabled during the weekend of your transfer date. As a result, we encourage you to plan ahead to take care of any account-related business and banking transactions by market close on the Friday before your transfer date.

Read on for important highlights about what this means and how it may affect your brokerage and bank account(s) and your ability to view them. For additional details, see the Notice of Changes you received from us.

Platform downtime

You’ll experience some platform downtime on the weekend of your transfer date.

On the Friday before your transfer date, after the close of extended hours trading at approximately 8 p.m. ET, through Sunday afternoon, access to your account(s) will be unavailable on etrade.com and E*TRADE mobile applications, including account information, trading, transfer requests, and banking features.

If you’re logged on when account access is paused, you’ll be automatically logged off and your current activity or information may not be saved. If you try to log on during the downtime period, you’ll be notified that online access is currently unavailable. Online access will resume Sunday evening in time for the open of the futures trading markets.

Please note that if you have multiple E*TRADE user IDs, online access will be unavailable only for the account(s) being transferred, as well as any bank accounts associated with the user ID(s) of the transferred account(s).

Access to online-initiated banking and cash management features

Due to platform downtime over the weekend of your transfer date, access to certain online-initiated banking features on etrade.com and E*TRADE mobile applications will be affected for bank accounts, as well as for brokerage accounts with banking features, if either:

  • You have banking features associated with your brokerage account(s).
  • You have a bank account at Morgan Stanley Private Bank that you access with the same log-on credentials as the brokerage account(s) being transferred. Please note that this type of banking account will be impacted by platform downtime and will not be accessible online during the weekend of your transfer date.

The following banking and cash management features will be impacted for the account types mentioned above:

  • Wires. Over the weekend of your transfer date, you will not be able to initiate domestic or international wire transfers from either your E*TRADE brokerage or bank account(s).
  • Fund transfers and real-time payments. Over the weekend of your transfer date, you will not be able to initiate fund transfers and real-time payments, and your scheduled internal transfers between E*TRADE accounts and Morgan Stanley Private Bank accounts will have delayed processing.
  • Online Bill Pay. Over the weekend of your transfer date, you will not be able to view, initiate, or modify Bill Pay requests.
  • Brokerage check requests. Over the weekend of your transfer date, you will not be able to request a check or checkbook from your E*TRADE brokerage account.
  • Check deposits. Over the weekend of your transfer date, you will not be able to access the E*TRADE mobile check deposit feature.
  • Available cash balance and banking activity. Over the weekend of your transfer date, you will not be able to view available balance information for your brokerage or bank accounts.
  • Opening a new bank account. Over the weekend of your transfer date, you will not be able to open a new bank account with Morgan Stanley Private Bank. You can do so, however, by visiting etrade.com once the transfer has been completed.

Important:

  • Debit and ATM cards will remain fully functional over the weekend of your transfer date, and you can continue to make payments with the existing checks associated with your bank and brokerage accounts.
  • If you have any urgent banking requests over the weekend of your transfer date (e.g., if you suspect fraud in your account or need to report a lost or stolen debit card), please contact E*TRADE Customer Service for assistance.

General treatment of open orders

After the close of extended hours trading at approximately 8 p.m. ET on the Friday before your transfer date, any open orders will be canceled for all product types except futures (e.g., equities, ETFs, options, mutual funds, and bonds) and may require action on your part.

  • Action may be required of you: Conditional orders, secondary market fixed income orders, certain stop orders, fractional orders for less than one share, and orders that cannot be adjusted due to late corporate action announcements will be canceled and will NOT be automatically reentered. Orders may also not be reentered if restrictions exist for a given account or symbol. Learn more
  • Action not required of you: All open orders other than those listed in the bullet above will be canceled and automatically reentered in the transferred account(s). Learn more

Note: You can learn more about the various types of orders by visiting Understand order types.

Open orders that are canceled and automatically reentered may cause you to lose priority for your order, which means that your order may execute at a time later than otherwise would have been the case if priority had not been lost. If you do not wish for E*TRADE to reenter your orders, you should cancel those orders before your transfer date.

If you have orders over the weekend of your transfer date, please carefully review the transfer guidelines for the order types you use. We strongly recommend that you review all your open orders after the transfer of your account(s) and prior to the opening of the next trading session.

The account’s order history and any saved orders will be transferred from the previous E*TRADE account number to the new E*TRADE account number. Any open orders canceled due to the transfer will show as canceled in your order history, even if they’re automatically reentered in your transferred account(s). You will not receive cancellation alerts for orders that are canceled and automatically reentered. Orders that are canceled and not reentered may or may not receive cancellation alerts, as described below.

Open orders that will be canceled and not automatically reentered

The order types shown below will be canceled but will NOT be automatically reentered. If you’d like to reenter any of these order types, you’ll need to do so manually after the transfer.

Conditional orders

  • Open conditional orders (e.g., contingent, quote trigger, bracketed, one-cancels-other, one-triggers-other, and one-triggers-OCO) will be canceled and will not be reentered.
  • Cancellation alerts will be sent for all canceled conditional orders.

Secondary market fixed income orders

  • Open secondary market fixed income orders will be canceled and will not be reentered.
  • Cancellation alerts will be sent for all canceled secondary market orders.

Certain stop orders

  • Any stop order types (stop on quote, hidden stop, and trailing stop) with a partial fill or a stop price that has been reached based on prevailing market data at the time of reentry will be canceled, and a cancellation alert may not be generated.
  • For example, an open stop on quote order with a sell stop at $50 cannot be reentered if prevailing market data indicates that the security is already priced below $50. Also, trailing stop orders with a stop price that has already been reached will not be reentered.

Orders impacted by corporate actions

  • Required open order adjustments for certain corporate actions (e.g., ex-dividend dates and stock splits) will be performed prior to reentered orders being sent to market.
  • For example, a limit buy order for a stock that will trade ex-dividend in the next trading session will be reentered at a limit price adjusted by the amount of the dividend.
  • These adjustments will be made on a best-efforts basis. If an order cannot be adjusted prior to being sent to the market (e.g., in the case of a late ex-dividend announcement), the order will be canceled, and a cancellation alert may not be generated.

Fractional orders to sell less than one share

  • Fractional orders to sell less than one share (e.g., an order to sell 0.75 shares) will not be reentered.

Open orders that will be canceled and automatically reentered

Except for certain order types, most orders will be canceled and automatically reentered during the weekend of your transfer date. Here’s some additional information about what this may mean for you.

Open orders with expiration dates

  • Reentered open orders will have the same order expiration date as the original open order.
  • For example, if a “Good for 60 Days” order has been open for 40 days, it will be reentered in the transferred account with 20 days until expiration.

Partially filled open orders

  • Partially filled open orders (except for conditional and certain stop orders described elsewhere) will be reentered with an open order for the remaining quantity only.
  • For example, if an order to buy 100 shares has an executed quantity of 30 and a remaining open quantity of 70, the reentered open order will be to buy the remaining 70 shares.

Fractional orders to sell more than one share

  • Fractional orders to sell more than one share will be reentered for the whole-number quantity only (e.g., an order to sell 50.75 shares will be reentered as an order to sell 50 shares). You will need to manually reenter the order to sell the remaining fractional shares (0.75 shares) after the transfer.

Tax lot selections

  • Entries you made in the Lot Selector when placing the original order will be retained, but any decimal quantities you entered will be rounded down to the nearest whole number and any entries for less than one share will round down to zero.
  • If you’ve selected specific tax lots to be assigned upon execution of an order, those same lots will be selected for the reentered open order as long as the quantity to be allocated is a whole (non-fractional) number.
  • If you’ve selected specific tax lots and entered a fractional quantity for allocation, only the whole quantity will be entered for allocation in the reentered order. For example, if you have a tax lot for 3.50 shares and you enter an order specifying that you wish to allocate 2.50 shares, the reentered order will allocate only 2.0 shares of that tax lot and any remainder will be allocated according to the account’s default tax lot preference.
  • If you’ve selected specific tax lots and entered a fractional quantity of less than one share for allocation of a given tax lot, that tax lot will not be specified for allocation in the reentered order. For example, if you have a tax lot for 3.50 shares and you enter an order specifying that you wish to allocate 0.50 shares, the reentered order will not contain any specification for that tax lot and any remainder will be allocated according to the account’s default tax lot preference.

Stop limit orders

  • Any stop limit order types (stop limit on quote and trailing stop limit) with a partial fill or a stop price that has been reached based on prevailing market data at the time of reentry will be reentered as a limit open order at your specified limit price.
  • For example, an open stop limit on quote order with a sell stop at $50 and a limit price at $51 will be reentered as a limit order to sell at $51 if prevailing market data indicates that the security is already priced below $50.
  • Any stop limit on quote orders with a stop price that was previously reached but did not receive any executions and where the stop price is no longer reached based on prevailing market data at the time of reentry will be reentered as a stop limit on quote order with the same conditions as the original open order.
  • For example, if the original order did not receive any executions, an open stop limit on quote order with a sell stop at $50 and limit price at $51 where the security moved below $50 but is once again above $50 at the time of reentry based on prevailing market data will be reentered as a stop limit on quote order with a sell stop at $50 and limit price at $51. In this scenario, the security will need to reach the stop price again before it is triggered and becomes a limit order.

Reserve orders

  • Reserve orders will be reentered as reserve orders if the remaining quantity in the order is greater than the display quantity. Partially filled reserve orders with a remaining quantity less than or equal to the display quantity cannot be reentered as reserve orders and will be reentered as limit orders for the remaining quantity.

Changes to your sweep option

As a result of the transfer, your sweep option will likely be changing. You can learn more about this change by reading Uninvested cash sweeps. Below you’ll find information about how this change may affect your account before, during, and after the weekend of your transfer date.

Please note: One week before your transfer date, you will not be able to change the sweep option for your account until after the transfer is completed.

Your Current Sweep Option1 Your Target Sweep Option2 What to Expect the Weekend of Your Transfer Date
ESDA, RSDA, or ISDA BDP
  • Before the transfer: Your ESDA, RSDA, or ISDA principal will be converted to BDP on Friday.
  • Saturday and Sunday: You’ll be earning interest in BDP, as applicable.
  • Monday and Tuesday: Your accrued interest for the interest cycle through the Thursday before your transfer date will be paid out on Monday and swept to BDP on Tuesday.
Morgan Stanley Money Market Fund
  • Before the transfer: Your ESDA, RSDA, or ISDA principal will be liquidated on Friday, and the interest accrued for the interest cycle through the Wednesday before your transfer date will be paid out on Thursday. Both will remain in free credit balance over the weekend.
  • Saturday and Sunday: Your free credit balance will accrue interest.
  • Monday and Tuesday: Your free credit balance will be invested in the eligible Morgan Stanley Money Market Fund on Monday. The interest that accrued since the liquidation will be invested in that same fund on Tuesday.
CBP BDP
  • Before the transfer: You will remain in CBP until Monday. Your accrued interest for the interest cycle through the Thursday before your transfer date will be paid out on Friday and remain in free credit balance.
  • Saturday and Sunday: Your free credit balance will accrue interest.
  • Monday and Tuesday: Your cash in CBP and free credit balance will sweep to BDP on Monday. The interest that accrued since the liquidation will sweep to BDP on Tuesday.
Morgan Stanley Money Market Fund
  • Before the transfer: You will remain in CBP until Monday. Your accrued interest for the interest cycle through the Thursday before your transfer date will be paid out on Friday and remain in free credit balance.
  • Saturday and Sunday: Your free credit balance will accrue interest.
  • Monday and Tuesday: Your cash in CBP and free credit balance will sweep to the eligible Morgan Stanley Money Market Fund on Monday. The interest that accrued since the liquidation will sweep to that same fund on Tuesday.
CBP
  • If you’re a pattern day trader at the time of the transfer, you will remain in CBP.
JPMorgan Money Market Fund BDP
  • Before the transfer: The principal in your JPMorgan Money Market Fund will be liquidated on Friday. Your accrued dividend for the dividend cycle through the Wednesday before your transfer date will be paid out on Thursday and remain in free credit balance over the weekend.
  • Saturday and Sunday: Your free credit balance will accrue interest.
  • Monday and Tuesday: Your principal and free credit balance will sweep to BDP on Monday. The interest that accrued since the liquidation will sweep to BDP on Tuesday.
Morgan Stanley Money Market Fund
  • Before the transfer: The principal in your JPMorgan Money Market Fund will be liquidated on Friday. Your accrued dividend for the dividend cycle through the Wednesday before your transfer date will be paid out on Thursday and remain in free credit balance over the weekend.
  • Saturday and Sunday: Your free credit balance will accrue interest.
  • Monday and Tuesday: Your principal and free credit balance will sweep to the eligible Morgan Stanley Money Market Fund on Monday. The interest that accrued since the liquidation will sweep to that same fund on Tuesday.

A mutual fund's prospectus contains its investment objectives, risks, charges, expenses, and other important information and should be read and considered carefully before investing. For a current prospectus, visit etrade.com/mutualfunds.

You could lose money by investing in a money market mutual fund. Although the fund seeks to preserve the value of your investment at $1.00 per share, it cannot guarantee it will do so. The Fund may impose a fee upon sale of the shares or may temporarily suspend your ability to sell shares if the Fund's liquidity falls below requirement minimum because of market conditions or other factors. An investment in any money market mutual fund is neither insured nor guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The Fund's sponsor has no legal obligation to provide financial support to the Fund, and you should not expect that the sponsor will provide financial support to the Fund at any time.

Money market mutual funds may be subject to liquidity fees and redemption gates if determined appropriate by the money market mutual fund's board. If a redemption gate is imposed, you will not be allowed to sell your positions and redeem shares from that money market mutual fund until the gate is lifted. If a liquidity fee is imposed, the liquidity fee will be deducted from the cash proceeds when you redeem your shares. You will receive the cash proceeds less the liquidity fee and any other applicable fees.

1. Current sweep options are: Extended Sweep Deposit Account Program (ESDA); Retirement Sweep Deposit Account Program (RSDA); International Sweep Deposit Account Program (ISDA); Cash Balance Program (CBP); and the JPMorgan Money Market Fund (symbol: OGVXX, JUSXX, or HTSXX). To check your sweep option, see your most recent account statement.

2. Sweep options for most client accounts will be swept to the Bank Deposit Program (BDP). Excess balances in eligible accounts will be swept to the Morgan Stanley Money Market Fund (symbol: MGPXX, DWGXX, or AAGS). Sweep options in pattern day trading accounts will remain in the Cash Balance Program (CBP).

Additional considerations before your transfer date

Here are a few additional considerations leading up to and during the weekend of your transfer date:

Incoming account transfers: After the Tuesday before your transfer date, requests received to transfer assets from another firm will be initiated on the first business day following the transfer date in your new E*TRADE account number.

Outgoing account transfers: After the Friday a week ahead of your transfer date, requests received to transfer assets to another firm will be rejected back to the requesting firm. If your outgoing transfer is rejected, you’ll be instructed to have the new firm re-submit the request on or after the first business day following the transfer date using your new E*TRADE account number.

Positions that may not immediately transfer:

  • If any of your securities are affected by a voluntary corporate action (e.g., a tender offer) during the weekend of your transfer date, they will remain in your current E*TRADE account until the corporate action is completed, after which time the securities or resulting cash proceeds will be released to your new E*TRADE account. Some securities affected by a mandatory corporate action soon after your transfer date may also remain in your current E*TRADE account until the corporate action is completed.
  • The value of any securities or resulting cash proceeds for corporate action events that remain in your current E*TRADE account will not be included in the net asset value or net account value of your transferred account, nor will the securities be included among your positions or available for trading. If you have any affected securities, there will be a message on the Complete View and Positions pages of all E*TRADE platforms informing you of the securities remaining in your current E*TRADE account and their value.

Pending trades: Executed trades that have not yet reached their settlement date at the time of the transfer will be moved to your new E*TRADE account during the transfer. You’ll see this activity as a transfer of an executed, not settled trade. If applicable, sell trades that are executed, not settled will be reported on your E*TRADE 1099 for 2023.

Linked accounts at Morgan Stanley Online: During the weekend of your transfer date, E*TRADE accounts that had been linked to Morgan Stanley Online credentials will be unavailable. Access to linked accounts will be restored after the transfer is completed.