Decades ago, a stockbroker was considered as a very expensive person to hire. But in today’s world, stockbroker services have become so cheap, you might end up spending more money at a fast food restaurant than paying your broker (as long as the trades are made online).
One of the major rules within the stock market is that no person is allowed to trade within the stock market unless they are a certified stockbroker. In other words, if the general public wants to buy or sell stock, they need a middleman, and that person is the stock broker. A licensed stockbroker performs every trade that occurs in the market.
What exactly can a stockbroker do for me? There is a wide range of services that any stockbroker can offer you, but nowadays they act as intermediaries between customers in the exchange of shares. Nowadays trades are made electronically so you don’t even get to talk to your broker like you once had to not to long ago.
When a stockbroker deal with the selling and buying shares based on your instruction then it is generally known as execution (dealing) – this type of service, offer you any type of advice when you want to perform. Well, the services are cheap and effective!
Back in the day when computers were uncommon (1980s and earlier), if you wanted to buy stock you would call your broker and tell him what stock you wanted to buy and the amount of shares. The Stockbroker would then call the trading desk who would then call the broker’s clerk and he would take the order and then pass it to the floor Broker who would literally walk to the trading post within the stock market for the specific stock and deals with he Specialist who would finally execute the customer’s orders.
So the whole process would take several minutes. Today, when you’re in front of your computer and click “buy” the order is executed almost instantaneously. You can see how in the 1980’s you would pay hundreds of dollars to a broker to execute your trade and now you pay $5 or less.
People think Stockbrokers work for them. That’s incorrect. A stockbroker works for the brokerage company and in fact, a stock broker is not a stock broker at all. The actual license is “Registered Representative”. There’s are sales people. Since they work on commission, they’re job is to inspire you to buy or sell as much as you can so they can keep collecting their fees.
In the 1980’s being a stockbroker pretty much guaranteed a high income. After all, not a lot of people were brokers back then and the fees were so much higher. Today, stockbroker is a very difficult job to get and especially to keep. Your fees are low and on top of that, competition is fierce. It is estimated that 90% of stock brokers quit within a year. It’s a very stressful job: Imagine calling strangers at all hours of the day begging them to buy stock from you. Or imagine knocking at everybody’s door and convincing them within those few minutes to buy stock from you. Not easy.
This article was written by WeAreSEOguru
