How DDM Works
Cash balances in investor accounts are sent daily into the DDM program the same way cash balances are sent into money market mutual funds. With DDM, investor deposits are swept into the DDM program and are programmatically allocated into several FDIC insured banks within its network. By depositing no more than $250,000 at each bank, investors are able to receive high levels of FDIC insurance up to the program maximum.
For example, an investor with $10 million dollars in cash balances will have deposits allocated to at least 41 banks in the program ($250,000 x 40 banks = $10 million.) The 41st bank is included to take additional deposits in excess of the $10 million and to accommodate interest accruals.