| Depending on the type of investing that you plan to | | | | follow your instructions to either buy or sell stock
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| do, you may need to hire a broker to handle your | | | | not to analyze stocks. |
| investments for you. Brokers work for brokerage | | | | Brokers earn their money from commissions on sales |
| houses and have the ability to buy and sell stock on | | | | in most cases. When you instruct your broker to buy |
| the stock exchange. You may wonder if you really | | | | or sell a stock, they earn a set percentage of the |
| need a broker. The answer is yes. If you intend to | | | | transaction. Many brokers charge a flat per |
| buy or sell stocks on the stock exchange, you must | | | | transaction’ fee. |
| have a broker. Depending on the type of investing | | | | There are two types of brokers: Full service brokers |
| that you plan to do, you may need to hire a broker | | | | and discount brokers. Full service brokers can usually |
| to handle your investments for you. Brokers work | | | | offer more types of investments, may provide you |
| for brokerage houses and have the ability to buy and | | | | with investment advice, and is usually paid in |
| sell stock on the stock exchange. You may wonder if | | | | commissions. |
| you really need a broker. The answer is yes. If you | | | | Discount brokers typically do not offer any advice |
| intend to buy or sell stocks on the stock exchange, | | | | and do no research — they just do as you |
| you must have a broker. | | | | ask them to do, without all of the bells and whistles. |
| Stockbrokers are required to pass two different | | | | So, the biggest decision you must make when it |
| tests in order to obtain their license. These tests are | | | | come to brokers is whether you want a full service |
| very difficult, and most brokers have a background in | | | | broker or a discount broker. |
| business or finance, with a Bachelors or Masters | | | | If you are new to investing, you may need to go |
| Degree. | | | | with a full service broker to ensure that you are |
| It is very important to understand the difference | | | | making wise investments. They can offer you the |
| between a broker and a stock market analyst. An | | | | skill that you lack at this point. However, if you are |
| analyst literally analyzes the stock market, and | | | | already knowledgeable about the stock market, all |
| predicts what it will or will not do, or how specific | | | | you really need is a discount broker to make your |
| stocks will perform. A stock broker is only there to | | | | trades for you. |