STOCK BROKERS

If a person wishes to trade (buy or sell stocks) in a stock exchange, he or she cannot just walk into the trading floor and start trading stocks. That transaction can only be executed by a stock broker. A stock broker is a financial market professional who is authorized to buy or sell stocks or company shares and other securities through a market maker (a firm who sells and buys stocks from its clients) or a stock trading agency. The stock broker executes the transaction for an investor or client.

A stock broker performs essentially three basic services, depending on the client: Execution, or simply carrying out an instruction by the client to either buy or sell; Advisory, or providing stock pick tips or advice to clients on what shares to buy or sell; and Discretion, where the stock broker makes all the decision-making in stock deals on behalf of the client.

Nowadays, modern technology enables a client to negotiate with a broker virtually, or online. Likewise, the stock broker can perform the brokerage functions online - get price quotes and bids, execute buying or selling, and close in the trade, all through an online stockbroking system. Stock brokers earn through commissions, paid to them by their brokerage houses, or through a fixed per transaction rate or monthly salary, depending on the brokerage firm that employs them.

In the United States, the General Securities Representative Examination, popularly called the Series 7 examination, is the qualifying test for interested individuals who wants to become a representative of a stock brokerage firm and be called a stock broker.