What is a Stock Broker?
Looking for a stock broker? Prepare to be a little confused. There are full-service stock brokers and discount stock brokers, representing a myriad of brokerage firms. There are execution only, advisory and discretionary dealing stock brokers. You can interact with your stock broker online or on the phone, and you can either bring your own plan to the table or rely completely on the broker’s expertise. While the term “broker” might make some investors a bit uncomfortable in these stark economic times, the word actually means “one who acts as an agent for another.” In the case of a stock broker, this can be done on various levels. An “execution only” arrangement puts most of the burden on the client, who calls the broker and simply provides instructions on what to buy or sell. Advisory dealing still leaves the decision with the client, but the stock broker may offer offer background information and suggestions. Finally, with a “discretionary” relationship, the stock broker is given free
A stock broker is someone who buys and sells stocks for an investor. Stocks, also called equities, are simply shares of ownership in a particular company. If you own 500 shares in a company that are worth $2.00 per share, you actually have $1,000 in equity. Your profits are determined by how much you pay for the equities initially, the commissions paid to your broker, and how much the equities are worth when you sell or trade them. A broker is licensed and regulated by the federal government or an overseas authority, depending on where they are located. Stock brokers receive a commission when purchasing or selling stocks. This is how they earn a profit. They are also advisors, recommending which stocks to buy or which to avoid. Recommending a Venture Stock brokers can assist you by recommending ventures in stock market trading or investing. A venture is a business decision or investment that has the potential to earn profits. You invest initial capital in hopes to earn more profits in
