Stockbrokers And How To Use Them

If you want to trade stocks on the market then you have to use a qualified broker to do this. These days brokers can offer more services than just buying and selling shares. They can track share prices, and provide valuable information on what they believe will be the next batch of movers and shakers in the market. You can receive a number of services from a broker and you will either be charged a set fee or a commission for these. There are three basic services that a stockbroker can offer which are trades, stock advice and management of portfolios.


For share trade only arrangements your stockbroker will follow your instructions to the letter and execute your trades. The stockbroker will not offer you any advice with a trade only service and this service is open to experienced traders and newcomers. This is generally the most inexpensive use of a stockbroker and they will often charge a commission based on the value of the trade. The basic service of trading shares on the market on behalf of investors is the most popular use of a stockbroker.


Second to offering basic trades is the provision of advice to investors. This will be more expensive than performing trades as the stockbroker is offering expertise of the market to help you decide on the best trades to make to turn a profit. It is also likely that the broker will give up a lot of time to you to confirm that you understand and are comfortable with all the recommendations. This time spent will really make a difference and is likely to come at a one off price with commissions payable on any trades.


Portfolio management comes in two forms which are advisory and discretionary. If you go for an advisory portfolio service, the stockbroker will create a proposal for you of shares that have a good chance of being in profit for you, then you have to decide what to do. If you choose a discretionary management option, then your stockbroker will work the portfolio without your input providing you with regular reports on how well the picks are performing.



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