What is a Brokerage House? (with picture)

Broker services are generally provided on a commission basis.

A brokerage firm, also called a brokerage firm, is a company licensed to buy and sell stocks or bonds. Acting as an intermediary between buyers and sellers, this company typically employs brokers who carry out the wishes of the company’s customers when it comes to stock trading. Brokerage services are generally provided on a commission basis.

The commission amounts charged for the purchase and sale of securities vary by brokerage. Often, the price per transaction is indicative of the level of service the company offers. For example, a broker that charges fees at the lower end of the scale may not execute trades as quickly as one that charges higher fees. Likewise, a company that charges higher commissions often offers a more personalized service.

In addition to commissions, a broker may charge a number of other fees. These fees may include charges for transferring assets, closing an account and transferring money. Additionally, a brokerage firm may require payment of IRA escrow fees, as well as annual service fees and fees related to periods of account inactivity. Depending on the broker’s policies, a client’s account may also incur a fee for not meeting the minimum required balance.

A brokerage may offer a variety of investment products or specialize in just one or two. Typical choices include stocks, mutual funds and options, as well as government and corporate bonds. Over-the-counter (OTC) newsletter stocks can also be offered.

There are several different ways to execute trades. A brokerage firm may choose to employ all or just some of them. For example, a company may allow trading over the phone or the Internet, as well as other methods.

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In addition to marketing various investment products, a brokerage firm may offer certain banking services. These services can range from money market scans and issuing checks to visa cards and ATMs. Money held in a brokerage’s money market account may carry a higher interest rate than money held in a regular bank account.

Often a brokerage firm can offer market research as well as investment strategies. While much of the information uncovered by these surveys may be available on the Internet, many people don’t have the time or inclination to look it up. In such cases, having an account with a company that conducts in-depth investment research can be extremely beneficial.

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