A stock broker is a person or a firm that trades on its
clients behalf, you tell them what you want to invest in and they will issue
the buy or sell order. Some stock brokers also give out financial advice that
you a charged for.
It wasn't too long ago and investing was very expensive
because you had to go through a full service broker which would give you advice
on what to do and would charge you a hefty fee for it.
Now there are a plethora
of discount stock brokers such as Scottrade http://www.scottrade.com now you
can trade stocks for a low fee such as $7 total.
I can think of three different types of stock brokers.
1. Full
Service Broker - A full-service broker can provide a bunch of services such as
investment research advice, tax planning and retirement planning.
2. Discount
Broker - A discount broker let's you buy and sell stocks at a low rate but
doesn't provide any investment advice.
3. Direct-Access
Broker- A direct access broker lets you trade directly with the electronic
communication networks (ECN's) so you can trade faster. Active traders such as
day traders tend to use Direct Access Brokers
So as you can tell there a few options for a stock broker
and you really need to pick which one suits you needs.
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