What happens if interactive broker goes bust?

While unlikely to happen, especially for interactive brokers, when a broker goes bust, one of two scenarios will occur:

1. Your holdings are liquidated and returned to you

2. The broker is bought out by another broker and your holdings are transferred to the new broker.

Either ways, your investments and cash will be held separately from the assets of the broker and will not be used to pay creditors when the broker goes bust.