Who is a broker
Almost every schoolboy knows that the brokers operate on the stock market, but few people really have a clear idea about who these brokers, why this work is so prestigious, than it is in reality most of these brokers are doing and what they earn.
Let's shed some light on the mysterious profession of a broker and the essence of his work.
So, the broker can be both physical and legal person, he plays the role of intermediary between the seller and the buyer of the securities market. Broker - is experienced exchange a player and a professional financier, which the client ïåðåïîðó÷àåò the law «on behalf» (that is, in the name of, on behalf and for the account of the customer) to perform any operations with securities. When the broker receives income in the form of a Commission fee, which is measured in percentage from the amount of transaction. But the broker is not necessarily acting in the interests of the customer, and only directly performs orders concerning the conclusion of the applications on the market. The importance of the broker in the securities market due to the fact that private traders do not have the right to directly carry out transactions with securities, thus, obliged in any case to resort to the brokerage services.
In addition to the basic functions, brokers may also provide other kinds of services, namely:
Options trading is to provide the brokerage firm workplace equipped with all the necessary equipment and software and information support, contributing to the successful work on the stock exchange.
Depository services " means services provided by the brokerage firm on storage of securities, property rights and other documents belonging to the trader.
The provision of brokerage shoulder - this service, the essence of which consists in the fact that the broker provides the trader under the pledge of the credit funds. The main advantage of using such a financial instrument is the fact that leverage allows you to use the financial resources, hundreds of times larger than the size of own capital of the trader. In addition, the loan is available and does not require a large number of various guarantees and large collateral. Leverage is seen in the ratio of own funds to credit and is expressed as a ratio, for example, 1:200. This ratio means that a single currency unit of own funds is available 200 units of debt.
Investment research and fundamental analysis of the stock market, as well as establishing contacts with sellers and buyers of securities on behalf of the trader.
In addition to brokers who represent the interests of clients on the stock market, there are so-called Internet brokers. Such specialists provide their services via the Internet and work on the Internet-exchanges, as Forex, carrying out the uninterrupted supply of client information, conducting the analytical studies of stock markets, as well as provide a client technical support.
It should also be noted that the range of job brokers is not limited to the securities market: there are brokers that serve the financial cooperation between ship owners and charterers, buyers and sellers (for example, mortgage brokers, customs brokers), insurers and the insured (insurance brokers).
