2) Brokers and Online Trading: What Does A Broker Do?
A broker is the middleman between a buyer and a seller. The broker’s primary job is to facilitate in the sale or purchase of a client’s securities. Think of it this way, brokers are the grocery stores, the shoppers (buyers) go to the grocery to buy stocks, while the producers (sellers) are the investors who want to sell their stocks through the grocery. In other words, brokers are the salespeople and they earn a commission when a trade happens.
The term broker can be used in a number of ways. A broker can be the individual person or it can refer to a brokerage firm such as Zecco, TD Ameritrade, Scottrade, Charles Schwab or Merrill Lynch.
Becoming a broker isn’t as simple as one might think and a license is required. This is because a broker must be well-versed in the regulations and laws in the securities industry. Most countries require passing an exam in order to get a license. In the United States, an aspiring broker must pass two licensing examinations to become a licensed broker. These exams – the Series 7 and the Series 63 – are given out by National Association of Securities Dealers (NASD).
- 1) Brokers and Online Trading: Introduction
- 2) Brokers and Online Trading: What Does A Broker Do?
- 3) Brokers and Online Trading: The Costs
- 4) Brokers and Online Trading: Full Service Or Discount?
- 5) Brokers and Online Trading: Choosing A Broker
- 6) Brokers and Online Trading: Accounts And Orders
- 7) Brokers and Online Trading: Conclusion