Brokerage Service

A broker is a person that facilitates transactions between traders, sellers, or buyers. Think of a broker as a middleman who ensures transactions can run smoothly and that each party has the necessary information. Brokers exist in many industries, including insurance, real estate, finance, and trade.

Types of Brokers and What They Do

a.) Stock Broker

Stockbrokers are financial entities that trade securities (tradable assets such as bonds, stocks, or options) on behalf of clients. Stockbrokers also provide other services like investment management and giving financial advice

There are three types of stockbrokers:

• Stockbrokers manage trades and take low commissions on deals, but they can’t provide financial or investment advice due to having different licensing and registration.
• Full-service brokers, or advisory brokers, can provide insight to their clients on when and where to trade, but they typically take higher fees because of this advice.
• Discretionary stockbrokerscan choose and make trades without consulting the client, but their asset management typically includes a heftier price tag.

b.) Mortgage Broker

Mortgage brokers assist hopeful homebuyers with finding mortgage loans from various lenders so they can choose the best rates and terms. Additionally, mortgage brokers act as an intermediary between lenders and borrowers, organizing and gathering paperwork from borrowers and ensuring its relayed accurately to the lender.

Mortgage brokers can work independently, but some work as part of a mortgage brokerage firm. These brokers typically earn money through commissions or origination fees on mortgages.

c.) Business Broker

A business broker helps clients buy or sell businesses. Typically, business brokers only work on selling and purchasing companies worth less than $1 million, while mergers and acquisitions (M&A) managers and investment bankers handle sales of larger businesses.

Business brokers have similar responsibilities as M&A managers and investment bankers, though. A business broker must determine the value of the business, pitch the sale to potential buyers, and assist in negotiations. Additionally, business brokers play a crucial role in ensuring the sale is kept confidential and allowing the business owner to keep their focus on running their company.