What is Insured Bank Deposit Sweep Program

IB's site explains it in plain English, at the link given. What's unclear about it?

https://www.interactivebrokers.com/en/index.php?f=27462
By joining the Insured Bank Deposit Sweep Program, eligible IB clients can obtain up to $2,500,000 of FDIC insurance in addition to the existing $250,000 SIPC coverage for total coverage of $2,750,000. Clients continue earning the same competitive interest rates currently applied to cash held in IB accounts. IB sweeps each participating client's free credit balances daily to one or more banks, up to $246,500 per bank, allowing for the accrual of interest and keeping within the FDIC protected threshold. Cash balances above $2,750,000 remain subject to safeguarding under the SEC's Customer Protection Rule 15c3-3, backed by the firm's equity capital, which exceeds $6 billion.
 
truetype said:
IB's site explains it in plain English, at the link given. What's unclear about it?

https://www.interactivebrokers.com/en/index.php?f=27462
By joining the Insured Bank Deposit Sweep Program, eligible IB clients can obtain up to $2,500,000 of FDIC insurance in addition to the existing $250,000 SIPC coverage for total coverage of $2,750,000. Clients continue earning the same competitive interest rates currently applied to cash held in IB accounts. IB sweeps each participating client's free credit balances daily to one or more banks, up to $246,500 per bank, allowing for the accrual of interest and keeping within the FDIC protected threshold. Cash balances above $2,750,000 remain subject to safeguarding under the SEC's Customer Protection Rule 15c3-3, backed by the firm's equity capital, which exceeds $6 billion.
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I read it too. I had read "Mortgage backed securities" too and found them cool investment tools.
I am asking any risk can be involved with it ? I am not a finance professional
 
paglos said:
I had read "Mortgage backed securities" too and found them cool investment tools. I am asking any risk can be involved with it ? I am not a finance professional
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The sweep reduces your risk. I guess there are the usual (overblown, ridiculous) IB "risks" discussed ad nauseum in other threads.
paglos said:
I was googling and saw several brokers :
https://www.fidelity.com/bin-public/060_www_fidelity_com/documents/fdic.pdf
https://www.scottrade.com/knowledge...count-management/scottrade-sweep-program.html
https://www.brokerage-review.com/expert/cash-sweep/td-ameritrade-cash-sweep-account.aspx
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These aren't all multi-bank sweeps like IB's program.
 
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