Stock brokers don’t offer their services for free. Not by a long shot. Each order carried out on a client’s behalf earns that broker a commission, regardless of the profit or loss to the client. In the case of traditional brokerage houses, the amount of commission is based on the number of stocks that are bought and sold or a percentage of the overall transaction. But, there has been an increase in the emergence of so-called discount” brokers and these are the guys that offer to carry out the exact same services for much less…usually a flat fee. Many discount brokerages are online services and are a fantastic resource for small time investors due to their lower transaction price, wealth of knowledge and tools they provide to their clients and the ability of the client to maintain a lower balance in his or her brokerage account.
The main drawback to using such services is the lack of personalized financial advice that you, as a client, will receive as compared to a traditional brokerage. Although more expensive, a traditional brokerage may be the way to go if you are looking for financial advice and stock trading tips in addition to facilitating your buy and sell orders.
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Stock brokers don’t offer their services for free. Not by a long shot. Each order carried out on a client’s behalf earns that broker a commission, regardless of the profit or loss to the client. In the case of traditional brokerage houses, the amount of commission is based on the number of stocks that are bought and sold or a percentage of the overall transaction. But, there has been an increase in the emergence of so-called discount” brokers and these are the guys that offer to carry out the exact same services for much less…usually a flat fee. Many discount brokerages are online services and are a fantastic resource for small time investors due to their lower transaction price, wealth of knowledge and tools they provide to their clients and the ability of the client to maintain a lower balance in his or her brokerage account.
The main drawback to using such services is the lack of personalized financial advice that you, as a client, will receive as compared to a traditional brokerage. Although more expensive, a traditional brokerage may be the way to go if you are looking for financial advice and stock trading tips in addition to facilitating your buy and sell orders.