How to select a broker - auto.teknodaring.com
Depending on the type of investments you plan to make, you may need to hire a broker to handle your investments. Brokers work for securities companies and have the ability to buy and sell stocks on the stock market. You may be wondering if you really need a broker. The answer is yes. If you want to buy or sell stocks on a stock exchange, you will need to hire a broker.
In order for a stockbroker to obtain a license he must pass two different exams.
These tests are very difficult and most brokers have a background with a bachelor's or master's degree in business or finance.
.png "Brokers earn their money from commissions") |
| Brokers earn their money from commissions |
It is very important to understand the difference between a broker and a stock market analyst. Analysts literally analyze the stock market and predict what the market will or won't do or how certain stocks will perform. Stockbrokers exist only to buy and sell stocks according to your instructions...not to analyze stocks.
In most cases, brokers make their money through sales commissions. When you instruct your broker to buy or sell stocks, the broker receives a percentage of the trade. Many brokers charge a flat fee on a “per trade” basis.
There are two types of brokers: full service brokers and discount brokers. Full-service brokers can usually offer more types of investments and usually provide investment advice. They are paid on commission.
Discount brokers usually don't give you any advice or research, they don't have any bells and whistles, they just cater to your needs.
Therefore, the most important decision you need to make regarding your broker is whether you want a full-service broker or a discount broker.
If you are new to investing, we recommend relying on a full-service broker to help you make smart investments. They will provide the skills you are lacking at this stage. However, if you are familiar with the stock market, all you really need is a discount broker to do the trading for you.
Source: auto.teknodaring.com
Post a Comment for " How to select a broker - auto.teknodaring.com"