A stockbroker represents the investors for the trade of buying and selling of stocks ensuring the maximum profit of the client. A stockbroker can be a firm or an individual who works for the brokerage. For a trader, the stockbroker holds great importance as it is not only that he offers the trading service for an offline account but also helps to have more credit and trade quickly. He also offers the technical analysis and charts that can help the trader to decide the policy if he wants to go for buying or selling of some shares. The risk in the trade can be known if the trader can understand the risk factors and avoid speculating trades that can drive one to unwanted loss and fall into the traps of miscreants of the market.
However, most of the brokers work far from stock trading floors. Below are given the main motives of a broker:
Seal the best Deal
A stock broker’s duty is to represent the client and make the best possible decisions for the investors. They must help their client in making the best deal that may be selling or buying of securities. A good broker also advises their clients on the matter of market dealings.
Handles the trade
A broker handles all the dealings of the client right from beginning to the end of the buying and selling process. He completes all the formalities in between and passes on the information to the client. After the transaction is made, the broker completes the required paperwork and documentation.
Payment Process
The individual brokers are mostly paid on commissions. Some of the percentages of the value trade are paid to the brokers, and it varies from firm to firm. Discount brokers are firms that work at a single price. Best Discount Broker in India can be searched online. They are governed by the “suitability role,” i.e., they are supposed to propose only the investments that meet the investor’s financial needs and goals.
Registration and Test
It is important for an individual broker or a brokerage firm to be registered by Exchange and Submission Commission. The broker must also pass the test conducted by the Financial Industry Regulatory Authority (FINRA). After the candidate cracks the test, he has to complete the registration process through a brokerage firm.
Requirements
The requirements for individual brokers for some brokerage firm vary from firm to firm. But the most common is the FINRA test and proper on-the-job training. The candidate must take the training before the test. Many firms also require experience of two years in order to become a broker.
Potential and Pay
The payment of the brokers in a brokerage firm varies from country to country. It also depends on the firm. Some firms cover security dealings, financial services, bonuses, and commissions in the payment according to some specified percentage of the trade value.
Overall, a broker’s work is to provide the best service to the customers and give them the best advice regarding the investments.
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