What Does a Stock Broker Do?
We’ve all heard characters in movies and television talk about their “brokers,” but does anyone really know what a broker is? Or, better yet, what a stock broker does? Stock brokers are involved in the stock market, which makes since given their job title. In order to securely and smoothly sell and trade financial securities such as stocks, bonds, and funds, there needs to be a middle-man between the buyer and the seller. The trading of these securities is absolutely imperative in order for the stock market to thrive and keep the economy alive. This in-between person is called a stock broker, and has various job responsibilities to take care of.
Buying and Selling Securities
Stock brokers are the only people who are authorized to purchase, sell, and trade securities. Therefore, they acquire clients and charge them a fee for the services that they receive. Stock brokers analyze their clients’ financial situations to determine the securities that are best fit for their lifestyles. Once a client’s securities have been agreed upon by the broker and the client, the broker sends the transaction to the security exchange department so that the transaction can be finalized.
Procuring Clients
The most important aspect of a stock broker’s business is having a solid client base. Stock brokers work for brokerage firms, and the firms pay the brokers a commission for each client that they have. Brokers thus spend a good majority of their days on the phone with clients and pursuing future clients. Their salaries are comprised of a base salary as well as commission, so having a large client base is of particular importance. Some of them even teach financial education classes in hopes of expanding their client base.
Analyzing the Market
One of the most important job duties as a stock broker is analyzing the market and knowing all of the trends. Stock brokers must know every facet of the industry because one bad investment could cost their client thousands of dollars. In addition, the broker must be able to analyze their clients’ financials properly and determine the type of security he or she should invest in.
Being Available
Another important job responsibility is being available to their clients. Most of their clients work day jobs and can only contact their broker after hours. This means that brokers need to be available for hours that are atypical for a workweek.