Brokers and Online Trading

Brokers and Online Trading: What Does A Broker Do? Brokers ar the muckle who handle customer orders to buy and sell securities. In the identical way that a grocery store acts as a middleman between shoppers and the companies that produce food, a broker acts as a middleman between the securities that trade on the foodstuff and the investors who buy them. We should also mention that the word broker stern be used in a variety of circumstances. It could spurious an individual person you deal with or it can look up to a brokerage firm such as Charles Schwab or Merrill Lynch. To be a stockbroker in the United States, you must snap two licensing examinations from the National Association of Securities Dealers (NASD): the serial 7 and the Series 63. These exams prove that a broker is informed ab protrude what he or she is selling and knows all the regulations and laws in the securities industry. Most countries mystify similar licensing programs. The most important thing to realize is that brokers are salespeople. They get a commission when you trade. This will be our localise in the next section. Opening an Account Every brokerage has divergent terms and conditions for opening an account. There is a full(a) range of minimum files, varying anywhere from $500 to $2,500. fasten sure you read the fine print beforehand.

There is aught more(prenominal) irritating than spending the time to fill out application forms only to discover you dont have adequacy money to open an account. So, youre not loaded? Dont worry, more and more online brokerages dont require a minimum deposit at all. Another option for those with small bank accounts is a dividend reinvestment plan (DRIP). A DRIP allows you to circumvent brokers by buy stocks directly from the companies that offer them. Commissions and Fees Every brokerage charges a different price (called the commission) to trade. The price is usually indicative of the service, so cheaper isnt eer better. The dirt-cheap brokers who charge... If you want to get a full essay, order it on our website: Ordercustompaper.com

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