Stock Brokerage: A firm engaged in the sale of investments and securities.

Mutual Fund: A fund operated by an investment company (we prefer that it be registered with the SEC) that raises money from shareholders and invests in stocks, bonds, options and/or money market instruments.

Hedge Fund: An investment vehicle that primarily invests in stock, commodity or future options designed to offset investment risk of a drop in the purchase price. A “put option” protects against any price decline over a given time period as a result of a payment of a premium. A “call option” sells the right to buy the stock, commodity or future at a certain price in exchange for a premium. (Note: We require the fund to be regulated by either the SEC or the Commodities Future Trading Commission).

Hedge Funds are designed for wealthy individuals and Institutional Investors. They commonly have a minimum investment of $1 million.

Surety & Fidelity Association Standard Form 14: Designed for stock brokers, the Financial Institution Regulatory Authority (FINRA) broker dealers, investment bankers and regulated hedge funds.

Companion Forms:

  • Computer Crime Policy for Financial Institutions: Stand-alone policy designed to cover exposures associated with the computer systems of the insured.

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