It is true that even though you can choose your own investments you must still use a stockbroker to execute the orders. You do not have to rely in their advice though it may be helpful. You can make your own selections but you will still require their services to invest. There was a time when you had no choice about the type of stockbroker to utilize. There was only one type of broker, the full service brokers, and they controlled the market. The commissions that they demanded for their services were very high but this was the industry standard. This contributed to the notion that the stock market and stock market investment were beyond the means of the average person and only for the very affluent.
The initial loss of control of the market by these full service brokerages occurred in 1975 and discount brokers emerged. They charged a fraction of the fees the full service brokers did and as such were a big hit on the market. They offered the same great services but were affordable to the average individual as the cost were significantly lower. Another great innovation was the introduction of the internet. This was a great innovation as there was greater trading efficiency as a result.
The overall effect of all the changes on the stock market was that individuals now had access to a ton of information that was never accessible to them previously. It is a debate however whether these avenues have in fact enhanced investments and made better investors. In the case of persons that do their homework and seek out the truth behind the hype the answer is a definitive yes. The investors out their can now choose the type of broker they require from the range available.
There are 4 classes of brokers. These are the discount / online broker, the cut price broker that provides information, the full service broker and the cash chief. The discount / online broker is essentially an order taker. They don’t offer guidance and won’t make it clear when to sell or buy a stock. There could be research available and other account management tools but the selection of investment in the stockmarket is completely up to you.
The adaptation of the discount / online broker that aids shoppers is the nest type. They don’t offer full consultation services but will have more research than order taking sites. They’re going to offer newsletters and investing tips but most probably not advocate particular stocks. You aren’t totally on your own with this option but you may still have to do a lot vis deciding on the best stock investment.
The full service broker will supply suggestions on express stocks and the broker will also access your financial standpoint to establish your wishes and investment options. This service is OK for the financier that hasn’t got the interest or time in making their investment decisions.
The money manager is made for the investor with a hefty investment sum. This broker will handle only significant portfolios and will invest and manage the entire account for a percentage of the assets under investment. This option can be expensive but very worthwhile in the long run.
Whichever option that you select confirm it suits your purpose and you are covered by the Instruments Financier Protection Co. Ask about backups and other alternatives in the event of technical issues and ensure your broker has your own interest at heart.