| If you plan to invest in stocks, you will need to utilize | | | | these firms will not offer advice if they are asked to |
| the services of a stock broker, who may be an | | | | do so-only that the client would have to pay extra in |
| individual or a firm acting as a middleman between | | | | terms of higher trading fees and commissions. These |
| the clients and the market. There are two types of | | | | brokers are usually paid either salary or commissions |
| brokers/brokerage firms in the market, full service | | | | or even a mix of the two. |
| stock brokers/brokerage firms and the discount | | | | So if you do not have adequate knowledge of the |
| brokers/brokerage firms. The traditional service stock | | | | market, then you should opt for a traditional broker. |
| brokerage firms design the entire investment | | | | But if you decide to opt for a discount broker, you |
| portfolio for their clients based on their financial needs | | | | should do some ground work. You need to find out if |
| and abilities and also carry out the transactions for | | | | the firm requires you to open a minimum opening |
| them. These firms also offer a wide array of | | | | deposit, and if so, for how much. Then again, there |
| services, products, investment strategies and | | | | may be firms that charge fees for operating your |
| research facilities for stocks, bonds, derivatives and | | | | account, transferring of assets out of your account |
| insurance. Needless to say that charges for these | | | | or charging you for an inactive account. Besides |
| services are relatively higher. These firms are usually | | | | checking out the reputation of the broker, you can |
| paid according to the number of times you trade and | | | | also ensure if the firm offers some research tools so |
| they are not paid on how well your portfolio | | | | that you can manage your investment. You also find |
| performs. | | | | out if the firm provides customer service and what |
| On the other hand, discount brokers simply carry out | | | | their turn around time is in answering queries and |
| the transactions and so charge customers significantly | | | | providing assistance to your account enquiries. Equally |
| lower fees than the regular broker firms. This is | | | | important is the fact that the brokerage firm should |
| natural since they provide limited services or advice | | | | provide you with the necessary security and privacy |
| as compared to the traditional brokers. In fact, the | | | | for your account and dealings. |
| people who usually approach these brokers are the | | | | All said, discount brokerage offers the perfect |
| ones who have adequate knowledge of stock | | | | opportunity for the people who want to participate in |
| market and they know what they want to buy or | | | | the stock market at the lowest possible costs and |
| sell. So what they actually want the discount | | | | with decision made at their own discretion. So if you |
| brokerage firms to do is to carry out their | | | | decide, a discount broker is just the thing for you, |
| transactions for them. That said, discount brokerage | | | | just be sure that the firm you choose is able to |
| is best suited for the people who can make their | | | | meet your business requirements at the best possible |
| own investment decisions. This is not to say that | | | | costs. |