Hey! My dear Equity Traders, Brokers or No brokers. What is your take?
Stockbrokers are lawful and registered firms by which all traders and investor in stock or the equity markets must trade. A broker is very important person in any investment decision and therefore, partakers of investment portfolio should consider there choice carefully.
HOW TO CHOOSE A BROKER
First, ask yourself whether they offer an online trading. In this computer age and internet any broker you prefered must have an online presence as this, will provide success to your trading and investment.
Find out if the broker if an accredited or allowed to do transactions for the clients. The broker must meet all the regulations and rules of brokerage. The code of practice must be followed to the latter. The rules are formulated to protect the investor
TYPE OF SERVICE
Different stockbrokers offers different type of services to their clients. Some deals with corporate clients, while others a retail investors or both. Hook with a broker that handles the account of your size and the service that matches your portfolio.
Try to look into whether the company is competitive in terms of proving various products for investments. Some companies are market makers. Meaning, they act as intermediaries between sellers and buyers when trading equities , forex and commodities in an online market. You should know that a market maker is after making good commision off of you and also many of your trades.
CHARGES AND COMMISSION
The total cost of buying and selling into a trade is added up the amount of commision charges. The percentage of charges on buying of stock or equities depends on the size of transaction. Buying and selling are considered as separate transactions therefore have to pay commision both ways when you trade in forex of future market you are charged commision in spreads. When you buy and sell the same shares through the same broker still you are charged commision. When you are dealing with large amount, the amount of commision can be as well huge.
If you are investing large amount of money, some brokers can give you a discounted commission, if you ask. No broker wants to lose a client with large amount of money for investment. Commission are negotiable and that means your roker needs to be competitive on that issue of commission.
Rapport: that kind of relationship you have with your broker is as well very important. As brokers obviously deals with many clients of which, they cannot give equal attention you need build a rapport. If you cannot give a phone call to your order or in between trading sessions, then it is advisable to look for another broker. The reason being that, the market move very fast and slight delay, may result into a lose of money.
Integrity: this is a test of a good broker. Remember that you are giving your hard earned cash to someone else who is not your relative. The most disturbing question is whether you can trust him. The reason to look critically at this issue of integrity is that, cases of brokers using client’s money has risen. They do this while keeping their clients on hold.
Reputation: Solicit some information about the broker from those who have already had a dealing with him. Besides that, also check on the rate of fallout from the client, incase it can be found. How many complains if any have been registered.
Promptness: How fast do they execute orders. Are there delays in money transfer processing? I know you will concur with brokers who acts faster because things change faster.
Empathy: A good broker has your interest at heart. He or she does things to your own benefit. A bad one will do the opposite.
Otherwise thanks for your concentration while reading this piece of article. Welcome for the next reads. Meanwhile you can do me a favour. Subscribe to join a list of writers in medium using my link.