An investor holds $400,000 in securities and $300,000 in cash in a single brokerage account at a firm that becomes insolvent. What is the maximum SIPC coverage this investor would receive?

Why A — $500,000 total ($400,000 in securities and $100,000 in cash)

SIPC coverage is capped at $500,000 per customer, of which no more than $250,000 can be for cash claims. Two limits apply here: the $500,000 overall cap and the $250,000 cash sublimit. The securities ($400,000) are fully covered. For cash, the lesser of two constraints applies: the $250,000 cash sublimit, or the remaining room under the $500,000 cap ($500,000 - $400,000 = $100,000). Since $100,000 is less than $250,000, only $100,000 of cash is covered. Total SIPC protection: $400,000 + $100,000 = $500,000, leaving $200,000 in cash unprotected. Remember: SIPC protects against broker-dealer insolvency, NOT market losses.