What is a Broker?
- You need a broker to buy and sell shares on your behalf
- A brokerage account is like a bank account for investing
So you’ve decided to become an investor, but how do you go about actually buying shares?
Shares can only be purchased by a licensed professional called a stockbroker. These are licensed and accredited professionals who ensure that trades are conducted with all the necessary legal and regulatory procedures. A stockbroker will buy and sell shares on your behalf in exchange for a fee.
Stockbrokers, therefore, act as a middleman between investors and the market. Much like if you’re feeling unwell, a doctor provides you a prescription, and the pharmacist fulfils that prescription. This is essentially the function of the stockbroker.