In order to do any forms on transactions on the stock market, one of the people you will need is a stock broker. A stock broker is basically someone who is licensed to perform sales and purchase of securities listed in a stock exchange. They take several tests before getting the license to do the transactions. Normal people who do not have the license are not permitted to do the exchange. This is to ensure that the people performing the transactions have at least the basic experience and knowledge on what they are doing.
A stockbroker offers many services to a client, including the following:
Know the client
Keeps the client informed
Purchases and confirms securities sales
Offers special accounts
How to choose the Stockbroker
In selecting a stockbroker, the following suggestions can be helpful:
Look for a well-trained specialist, as in the selection of an accountant of lawyer. Get recommendations from an accountant or lawyer or persons who have had successful relationships with a broker.
Background. Brokerage firms have pamphlets describing their services, the securities available and exchanges where traded, purchase recommendations, and the costs and commission charges. Make certain that the services provided can accommodate your investment objectives.
Qualities. You should feel at ease with your stockbroker since you will be providing personal information about your finances and investment goals. The stockbroker should listen to your expectations and understand your needs. Based on the information provided, the stockbroker can develop an investment strategy tailored to an investor’s needs. Make sure you understand the investments that are recommended to you for purchase. A good stockbroker takes the time to explain how any security purchase fits your investment goals.
How to work with the Stockbroker
As investment decisions are made with the help and advice of your stockbroker, keep these factors in mind:
It is your money being invested and you have the final decision of how and when the investment should or should not be made.
Read and understand the prospectus and other information given to you by your stockbroker.
Always understand what risks are involved? How does this security purchase help you reach your investment goals?
Any questions should be fully answered by your stockbroker. Continue to make contact until answers are obtained. Do not approve any purchase until your questions are satisfactorily answered.
Keep track of your investment through review of the quarterly and annual company report, and financial information in newspapers and periodicals. Review all confirmations and account statements you receive from the brokerage firm. Ask your stockbroker to explain anything you might not understand or answer any questions you might have from your review.