For those who just started in the trade business, you must know that stock brokers are not the only type of broker around. In fact, there are various types of brokers that you can rent services from, depending on your needs.
There are two main types of brokers:
Full service broker
It is recommended that beginners in trade obtain services from full service brokers. As the title is disclosed, full service broker offers buying and selling services and complete suggestions about anything related to the trade business. This can include pension planning and / or suggestions on how to handle your tax. Full service brokers provide extensive research and appropriate professional advice on how to best deal with your account management problems. This is one of the best benefits of full service brokers especially for beginners since trade requires a lot of research and information to arrive at the wisest decision in handling assets – that is, get the biggest profit and avoid the biggest losses. Full service broker, however, did not decide for traders. They only provide their research presentations and work on the best of the decisions provided by traders.
Someone must notice that the tariff for full service brokers can be high. But for a beginner, it can be a good idea to have an advisor and learn the rope from a professional.
Discounts brokers are recommended for professional traders because this kind of broker only makes buying and selling orders. Unlike full service brokers, discount brokers do not provide research and account management advice. An investor must do all research to be able to make decisions about his personal account. They are called discount brokers because traders pay less. This is good news for beginners who have small capital on investment even though it will become more risky in decision making.
There is a broker that can meet specific needs:
Traders only need to deal with brokers online via the internet or by telephone. The trading platform is shared by brokers and online investors. Buy and sell orders can be reduced in instant to the broker. An online broker is recommended for investors who often travel and don’t have much time in their hands to meet with direct brokers.
Futures brokers help speculate on the movement of commodity prices in the future. Thus, in choosing a futures broker, someone must be secured in brokerage research capabilities. Because trading futures depends on the accuracy of speculation to make continued decisions, a comprehensive research is needed.
Especially for foreign exchange trading, forex brokers must be able to present trade details and can be speculated on forex trading trends. Forex trading is a very fast trade industry and forex brokers must have access to resources needed for this kind of trade.
Remember that the broker is different in expertise. Determine the type of broker that best suits your needs as a trader. If you are a beginner, maybe you should choose a full service broker. But it will be less capital, it might need a little more effort on your side and get a discount broker. It’s up to you to choose wisely.