The MF Global disaster emphasized the need for investors to go to any means to protect their wealth. Stockbrokerage firms do not want to facilitate any move to the issuance of physical stock certificates. When you buy stocks, the stockbroker generally puts the stock in their “street name” rather than yours. This makes it easy for them and is not designed to be for your best interest unless you are a trader and hold the stock for a short period of time. If you are planning to hold your stocks for an extended period of time, you may want to consider Direct Registration.
I recently contacted my local Scottrade office and told them I wanted to transfer most of my stocks in the account to Direct Registration. This is a service of the Stock Transfer Company that handles the issuance of stock for the publicly traded company. I completed the paperwork for each stock I wanted transferred and all but one were moved to a newly established DRS account where I am the stockholder of record, not the stockbroker’s “street name”. Now that I am recognized by the Stock Transfer Agent, I could have them issue paper certificates if I desire. This action removes the inherent risk of some unexpected event occurring with the stockbrokerage firm that could put your assets held with them at risk. It is amazing what we must do to protect ourselves these days!
By the way, a smaller Canadian-based transfer agent was evidently not set up to handle Direct Registration so that particular stock is still sitting in my brokerage account. The rest transferred without issue and I have received the confirmations in the mail.