What is CHESS Sponsorship in Australia?
Operated by ASX Settlement, CHESS (Clearing House Electronic Subregister System) is the gold standard for share ownership in Australia. When you use a CHESS-sponsored broker (such as Stake AUS, CommSec, or CMC Markets), you are issued a unique Holder Identification Number (HIN) starting with an X.
CHESS Sponsored vs. Custodial Model
- CHESS Sponsored (HIN): Your ASX shares and ETFs are registered directly in your legal name on the ASX subregister. If your broker ever goes into administration, your shares remain untouched in your HIN and can be transferred to another CHESS broker in days.
- Custodial Model: The broker holds shares in a pooled omnibus trust account on your behalf. While often cheaper for micro-investing, you do not get a personal HIN and cannot easily port holdings without custodial transfer fees.