Discount Stock
Brokers Offer A Variety Of Useful Services
If you are going to invest in the stock market, you must execute
your orders through a stock broker. However, not all stock brokers
give you the same services or charge you the same price for the
commission to execute your order. You may want to consider one of
the discount stock brokers to handle your trades.
There are basically three types of discount stock brokers; full
service discount, discount, and deep discount stock brokers. Online
discount stock brokers are available also but here you will not have
close contact with a warm body, which most investors like.
The first type of the discounters is the "Full-Service Discount"
broker. They provide almost the same types of services as the
traditional full service stock brokers. However, this type of the
stock broker will charge you about 50% of the normal commission rate
of the traditional firms. They will provide trading advice as well
as their research reports. Market newsletters are also part of the
package of services. You will probably deal with the personnel at a
local branch office.
The next type is the “Discount Broker”. These stock brokers provide
stock market execution services for a variety of different types of
trades. Basically, you tell them what you want to buy or sell and
they merely place and transact the order on your behalf. This type
of the discount stock brokers are designed for people that want to
make all their own decisions and save money on the commission that
they pay. Investors who use this type of broker do not want any kind
of stock market or trading advice. Bear in mind though, they will
not hold your hand or give you a shoulder to cry on if your
positions go wrong. You are totally on your own with these types of
stock brokers.
The third type is the "Deep Discount" brokers. They will execute
your order usually for a flat rate, as opposed to a percentage of
the money involved in the trade. These discount stock brokers offer
absolutely no services other than the execution of your order. You
will probably not be dealing with the same personal all the time, as
many are nationwide with toll free numbers. Often this type of the
discount stock brokers offers computer execution for online trading.
Discount stock brokers are a highly competitive group when it comes
to pricing their services. Some are now moving into some of the
features, market letters, and research reports, of the full service
companies but without always giving you specific trading advice.
Therefore, when you are looking for discount stock brokers, be sure
to shop around and ask questions.