How Stock Broker Can Help Us
Posted on October 13, 2008
Filed Under Finance | Leave a Comment
Not his height, physique or talks that impress you, but it’s his intelligence, experience and services that attract any investor towards stock broker. The heart of stock investment guidance lies with stock brokers. Not only are they the catalyst to stock exchange but also provides a chance for any investor to have better returns on their hard earned money. Stock brokers are the people who wave the path to better investment prospects and support you to get through the winds and storms of stock market.
A stock broker offers many services to his clients in return of stock brokerage. However, this stock brokerage may vary from one broker to another. Some offers discount brokerages, other may offer cheap brokerage terms. Actually, competitive market keeps a check over the brokerage terms, thus, favours the investors.
As such there are many services provided by stock brokers, an overview is enlisted below:
- Keeps himself informed: it might sound amusing to you that keeping himself informed is no service that is provided to the client. However, it should be noted that keeping updated about the requirements of the client is the best service a stock broker can provide. Keeping an eye over market is their job and in case they seize any opportunity that suits the client’s requirements, may help client to get the benefit of the opportunity.
- Keeps client informed: a stockbroker is the jack of all trades. He is well aware of the current market conditions and prospected market behaviour. Hence, keeping the client updated and warning for future helps the client to decide over his investments plans and work out on current investments.
- Confirming purchasing and selling of securities: the purchase and selling of securities is generally made by stock broker. Hence, notice of confirmation of deal, details of price and proceeds of transaction are provided by stock broker. Also, the future prospects details are detailed by every stock broker to his client. In case, the investor do not find the deal suitable, stock broker make arrangements to cancel the deal.
- Trading on behalf of client: there are certain special functions that are undertaken by any stock broker. In special accounts, named, discretionary accounts, the stock broker may trade in socks on behalf on the client. This type of service needs a trustworthy relationship between the client and the broker. Hence, maintaining positive terms with the client is other service provided by stock broker.
- Marginal trading: marginal trading is another special service provided by stock broker. It allows the investor to trade beyond his actual amount in the trading account. Using marginal account limit allows investor to make sale or purchase on the amounts which are currently not there in his account, though they are repaid within a fix period of time to the stock broker with additional interest amount.
- Insurance protection: it is another tool that secures the investors investments. In case the broking firm gets to financial difficulties or has to go for liquidation, the insurance protection plan to make sure that investors get their amounts of their accounts with share brokerage firm. Hence, the loss making share brokerage firm cannot compensate its loss with its clients.
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