[WorkUntilRetire]

Did Lehman run index funds? What happened to their customers?

What would happen today if a firm like Schwab or Fidelity suddenly went bankrupt? Would their S&P 500 index funds (Such as SWPPX or FFFFX) drop to zero, wiping out customer’s retirement?

[craftyguy]

> Would their S&P 500 index funds (Such as SWPPX or FFFFX) drop to zero, wiping out customer’s retirement?

I'm no expert, but I wouldn't think so if those funds track the indexes, since the index 'values' are the collective values of the stocks they represent. On the other hand, SWPPX, etc would no longer be maintained. That's a really good question though, I hope someone with more knowledge comments!

[akashshah87]

Not an exact answer to your question, but see this post on the Bogleheads wiki regarding Vanguard - https://www.bogleheads.org/wiki/Vanguard_safety