Why Do I Need A Stock Broker?

Why A Stock Broker

A stock broker executes trades, buy and sell orders, for an investor trading in the stock market.  A stock broker refers both to the online stock brokerage firms plentiful in today’s market, and also to the retail, more old-fashioned type, stock broker.  You don’t need a stock broker necessarily.  There are day traders who execute stock trades everyday themselves using ECN, Electronic Communication Networks.  These peer-to-peer trading systems enable one to make buys and sales on their own.  They are not cheap, however, costing tens of thousands of dollars.  Even still, there will always be middle man involved at some point to process or at least ok an order, even if it is digitalized in the process.  So for the average investor, even the expert investor, stock brokers are most often a need.

Retail Stock Brokers

Many investors still use retail stock brokers, and it is for good reason.  Retail stock brokers and their stock brokerage firms perform far more duties than simply calling in an order from a client.  Most often these stock brokerage firms choose the stocks and funds for their clients.   This is based on years of knowledge and experience investing usually tens of millions of dollars.  A stock broker guides you in your purchases at the least, and at best when paid a commission, completely manages your stock portfolio.  Retail stock brokers usually get excellent returns for their clients.  It is their business to do so, and the more they get you, the more they make.  Healthy incentive to invest your stocks wisely.

Online Stock Brokers

Online stock brokers, which after 20 years or so in business, cannot exactly be considered new to the stock market trading scene.  What is new is that they are the leading mechanism that investors look to who need stock brokers.  Online stock brokers execute trades; offer the same things in terms of options as retail investors, yet charge much less.  The average online stock broker charges $10 or less per trade.  Online stock brokerage firms will manage your accounts, but not your portfolio.  Their advice is found in the information supplied on their websites with company financials, stocks news, and helpful tips on profitable investing.

Related posts:

1. How Does Online Stock Trading Work?
2. Do I Need A Stock Broker?
3. What Is The Advantage Of Online Stock Trading?
4. What Is A Broker?
5. What Is Online Stock Trading?