STOCK BROKING

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Stock Broking

A stockbroker is a professional trader who buys and sells shares on behalf of clients. The stockbroker may also be known as a registered representative or an investment advisor.

Most stockbrokers work for a brokerage firm and handle transactions for a number of individual and institutional customers. Stockbrokers are often paid on a commission basis although compensation methods vary by employer.

Brokerage firms and broker-dealers are also sometimes referred to as stockbrokers. This includes both full-service brokers and discount brokers, who execute trades but do not offer individualized investing advice.

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Most online brokers are discount brokers, at least at their basic levels of service, in which trades are executed for free or for a small set-price commission. Many online brokers now offer premium-level services with higher fees.

Key Takeaways

A stockbroker or broker buys and sells stocks at the direction of clients.
Most buy and sell orders are now made through online discount brokers. This automated process reduces fees.
Wealthy individuals and institutions continue to use full-service brokers, who offer advice and portfolio management services as well as completing transactions.