Participants of the stock exchange, dealers and brokers
So, in the previous chapters we have learned, what is the stock exchange and met with leading representatives of the world's stock exchanges. Now we will consider the main participants of the stock exchange. You already know that the activities of the stock exchange may carry out only its members. So you know that in order to participate in the exchange they need to comply with the established by the exchange and legislation requirements. A special license is one of these requirements. Licenses are issued by the Federal service for financial markets (FSFM). She license transactions on stock exchanges. Dealers and brokers are the only parties that can trade on the stock exchange. Let's see how they differ, and what are their functions?
Dealers - professional participants of the stock exchange, which include banks and investment companies, which are engaged in trade of securities. They conduct business on its own behalf, for their money and are not engaged in intermediary operations. Transactions they conclude with clients, brokers and between themselves. On a difference of rates of the seller and the buyer, as well as on changing the rates of securities and currencies, they get their profit.
Brokers are professional participants of the stock exchange, which have the right to perform operations with securities on behalf of the client and at his expense. This intermediaries engaged in the conclusion of transactions between sellers and buyers of currencies, securities and other financial assets. Do you know on what they earn? Everything is simple! Their income is Commission for intermediary activities, which they receive in carrying out operations with securities. Of the transaction amount depends on the amount, which will be given to the broker as a reward. At the moment, the main volume of intermediary operations is performed large brokerage companies that have a large network of branches and connection with banking institutions.
The broker's job is simple: the customer gives him the order of sale or purchase of securities, and the broker places the application on the market, on which sought a counter application, after which they are performed. In the obligations of the broker is good and clear performance of clients ' orders.
We found out that the participants of the stock exchange are dealers and brokers. Now focus on the main difference of the dealer from the broker: the dealer deals on its behalf and for its own account, while the broker works on behalf of the client and is, in fact, the intermediary. The dealer independently carries out its activity on the stock exchange and is not engaged in intermediary activity - all embedded in securities, metals and foreign currency money belongs to him.
