What is Trading Broker ?

A securities firm or an investment advisor associated with a firm. When acting as a broker for the purchase or sale of listed stock, the investment advisor does not own the securities him or herself, but acts as an agent for the buyer and seller and charges a commission for these services.An intermediary. An individual or organization in-between the person/organisation that controls the funds and the provider/trader.

A broker often knows someone who knows somebody else who may provide program trading. This chain of brokers is known in the business as a "daisy chain". There are thousands of "want-to-be”-, "hope-to-be”- and "wish-they-were” brokers in the high-yield business who are giving the industry a bad name.A marketing specialist who represents buyers of property and liability insurance and who deals with either agents or companies in arranging for the coverage required by the customer.A marketing specialist who represents buyers of property and liability insurance and who deals with either agents or companies in arranging for the coverage required by the customer.

In commerce, a broker is a party that mediates between a buyer and a seller. A broker who also acts as a seller or as a buyer becomes a principal party to the deal. Distinguish agent: one who acts on behalf of a principal.In computingIn computing, a broker consists of software which mediates between two objects: typically between a client and a server or between a repository and a requestor or caller. See for example:* object request broker* storage resource broker* tunnel broker* message broker* Information broker* Broker, Outer Hebrides — village in the Outer Hebrides of Scotland* The Power Broker — a biography of Robert Moses* The Broker — a novel by John Grisham* Limo Broker — Limousine rental broker.* Loan Broker — Home loan broker company - Loanskey.

Currency trading is the largest market on the planet. It is estimated that in excess of US$2 trillion is traded every day. Compare this to the New York Stock Exchange's daily transactions of approximately US$50 billion, and you can see that the magnitude of the currency trading market exceeds all other equity markets in the world combined. The practice of currency trading is also commonly referred to as foreign exchange, Forex, or FX, for short.
All currency has a value relative to other currencies on the planet. Currency trading uses the purchase and sale of large quantities of currency to leverage the shifts in relative value into profit.

There are two reasons the relative value of a currency fluctuates. The first is because of a 'real' market: as outside investors or visitors wish to buy things within a country, they are forced to convert their domestic currency into the currency of the country they are buying within. Similarly, as money leaves the country, people must sell their currency for the foreign currency they will need to spend or invest abroad.

The second force for currency fluctuation is speculation. As investors feel a given currency will act strongly or weakly, they will buy or sell accordingly. This speculation can have drastic consequences

on a national currency and consequently on a country's economy. During the East Asia Crisis in 1997, for example, as nations in Asia began facing economic downturns, speculators used currency trading to realize enormous profits and in many analysts' view helped to exacerbate the problem.
Currency trading has many very real benefits over equity trading like the stock exchange. The spreads for currency trading are extremely low, making the cost to a trader very low as well. The volatility of the currency market is extremely high, which means that a trader can generate enormous return on a given exchange. The ratio of volatility to spread is approximately 500:1 for the currency trading market, as compared to 100:1 for even the most ideal of stocks.
Until recently, the currency trading market was very closed to small investors.

Banking conglomerates and large multinationals were the main movers of this market place. In the past few years, however, new technologies have opened the doors to investors of all stripes. It is difficult to miss the enormous benefit of this 'new' market for the individual investor: higher returns with lower risk given the same amount of market knowledge have a very small downside.

Insurance broker

The term Insurance Broker became a regulated term under the Insurance Brokers (Registration) Act 1977[1] which was designed to thwart the bogus practices of firms holding themselves as brokers but in fact acting as representative of one or more favoured insurance companies. The term now has no legal definition following the repeal of the 1977 Act. The sale of General Insurance has been regulated by the Financial Services Authority since 14 January 2005. Any person broking insurance can now call themselves an insurance broker.Insurance brokerage is largely associated with general insurance (car, house etc.) rather than life insurance, although some brokers continued to provide investment and life insurance brokerage until the onset of more onerous Financial Services Authority regulation in 2001.

Insurance broking is carried out today by many types of organisations including traditional brokerages, Independent Financial Advisers (IFAs) and telephone or web-based firms.Independent Advisers in the UKUnder UK polarisation rules the concept of the Independent Financial Adviser or IFA was born.

To be independent of any insurer or other third party interest ensures the client receives unbiased advise. The non-independent advisers are therefore company representatives, and thus may have a conflict of interest. Since 1st December 2004 the Financial Services Authority has introduced a new classification of multi-tied adviser who may represent more than one company. Examples of multi-tie advisory networks include Intrinsic Financial Services [2] and Openwork (formerly Zurich Advice Network) [3].UK Financial Services Authority Polarisation Rules [4

Online Stock Trading

The Benefits Of Online Stock Market Trading Regardless of whether you are an experienced stock trader or new to trading stock, you may never have experienced the joy of stock trading online. If that's the case, and you are currently thinking of trading online, you may want to know what all the fuss is about! To help you understand, the following are just some of the benefits of online stock market trading:

CommissionsOne of the biggest, if not the biggest, benefit of trading stocks online is the reduced stock broker commissions you�ll be expected to pay. In most cases, when trading stock online, brokers will charge you a commission of between $7 and $10 per trade. However, if you trade in sufficiently large enough volume, it is possible for you to negotiate with your broker so that these brokers� fees can be as low as $0.01 of the transaction value. ControlWhen you use a broker in the real world you may find that your broker will not agree to execute a trade, believing your decision to buy or sell the stock in question is flawed.

When you trade stock online this is no longer a problem, your broker has no input as to when you buy and sell stock � you do! PortfolioIn the real world some brokers will not buy certain stock � for example, some penny stocks. This may limit the stock you are able to have as part of your investment portfolio. However, when you trade online, subject to availability, you can trade in any stock - on any stock exchange - you want! InformationWith the use of computer software programs, you can use stock charts, technical indicators and real time stock prices to help you make the investment decision you want to make, when you want to make it. TimeOne of the essential elements about trading stock is the time it takes to execute the trade, as this can mean the difference between making a profit and making a loss. In the real world you have to phone your broker and ask him to sell/buy the stock. The broker then phones the trader, who gives the broker the price.

The broker than tells you the price and you either agree to buy/sell or not to. If you agree to buy/sell, the trader then phones the order through to the trader. Online you push your mouse over a cursor and press buy/sell. A much quicker sell! VolumeAssuming you are happy paying the commission, you can trade as large or small as you want over the Internet. In the real world, most brokers require a minimum buy/sell that is out of the reach of most individual traders. Finally�All in all, online stock trading is about �you�. It provides you with the opportunity to trade in stocks without having to pay large commissions while keeping control over your investment decisions.

Stock broker

A Stock broker sells or buys stock on behalf of a customer. The stock broker works as an agent matching up stock buyers and sellers. A transaction on a stock exchange must be made between two members of the exchange — a typical person may not walk into the New York Stock Exchange (for example), and ask to trade stock. Such an exchange must be done through a broker.In addition to actually trading stocks for their clients, stock brokers may also offer advice to their clients on which stocks, mutual funds, etc. to buy.Transactions by stock brokers in the US and UKIn the US: When acting as an agent, the stockbroker typically charges the client a flat fee and/or a percentage-based commission for undertaking the trade, and the price quoted the client must be the best price available in the market.

When acting as a principal, the trade could be with another market participant or one of the stockbroker's clients. When trading in a principal capacity with a client, the broker informs the client and charges the client a markup or markdown from the prevailing market price.In the UK: Stock brokers act the same in the UK as in the US, except that when trading in a principal capacity with a client, the broker is obliged to inform the client and no commission is charged.Other jurisdictions are thought to have similar rules.[edit] Brokerage termsFront office: This is a description of the part of a brokerage firm that is "client facing". The sales staff, brokers and traders are part of the front office. Functions of the front office include acquisition and entry of orders, fulfillment of the orders, and all the regulatory reporting for the orders.Back office:

The back office is where the clearance processing of the trades is done. Transfer of securities and money and the tracking of "failure to deliver" is handled. Securities lending for a brokerage firm, wherein shares of a security that is being sold short are located to ensure they can be delivered, is usually included in the back office as well.* Prime brokerage* Retail broker* Low cost broker[edit] Famous stock brokers* Larry "Buster" Crabbe - Actor and former Olympic swimmer, Crabbe became a stockbroker and businessman after a career in film.* Brian Dennehy -

An actor, Dennehy worked as a broker for a time at the same firm as Martha Stewart.* Edward Francis Hutton - Founder of the firm known for its slogan: "When E. F. Hutton talks, people listen." In the late '20s and early '30s, Hutton was married to cereal heiress Marjorie Merriweather Post. Hutton's daughter with Post was actress Dina Merrill, the one-time wife of actor Cliff Robertson. Hutton's namesake firm imploded into bankruptcy in the 1970s.* Michael Milken - The financier came to fame at Drexel Burnham Lambert in the 1980s.* George Murphy - Silent film and early talkies star Murphy worked for a time as a Wall Street runner.* William A. Paine - co-founder of Paine Webber.* Hemish Shah - Late English poker player, who left stocks for poker, going on to win a World Series of Poker bracelet.* Martha Stewart - After she gave up modeling in the late 60s, Stewart worked as a broker on Wall Street for 7-8 years before launching her lifestyle business.* Christopher Gardner - A man who grew from homelessness to being a multi-millionaire by stock broking.

What is margin trading?

Margin trading is buying stocks without having the entire money to do it. The exchanges have an institutionalised method of buying stocks without having the capital through the futures market.
For example, if you were to buy 2000 shares of say Company A, which trades at Rs 300, you will need about Rs 6 lakh. But if you buy a future contract of that company, which comprises 2000 shares, you only need to pay a margin of 15 per cent. So by putting Rs 90,000, you can get an exposure of Rs 6 lakh.

The same operation can also be executed through margin trading. Here, the trader will buy 2,000 shares, which are partly funded by the broker, and the rest by the trader.
The Sensex's rise and fall: Coverage

The percentage of margin funding may range between 50-90 per cent, depending on the broker and his relationship with the client. The broker, in turn, funds his line of credit from a bank, and keeps the shares in his account with any profit/loss going to the client.
Margin trading vs futuresMost investors buy the futures, but there are times when margin trading makes mores sense. If a stock is not in the futures list, the client can go for margin funding.

Since futures are generally not available beyond one or two months, if the client has a longer view, then margin trading is better. Also, some brokers offer lower interest rates on margin trading than the prevalent rates in the futures market.
The margin callOnce the trader buys a future or stocks in the margin account, the client gets the profit/loss since his purchase in his account.
In both futures market and margin trading, if the value of the share falls below the purchase price, the broker will make margin calls, asking the client to deposit additional margin.
In a normal market, these margin calls are not a problem as clients can deposit the additional amount easily.

When clients are not able to meet the margin requirement, the broker sells the security so that he does not have to bear the risk in case the stock falls further.
This typically become a problem when the markets fall far more than expected and traders are not liquid enough to meet the margin calls. And when a lot of traders can't meet margin calls, the situation snowballs.

This is what happened in the past few days when traders, who were over-leveraged could not meet the margin calls, and their securities kept being sold.

A business broker

A business broker is a person or firm that acts as an intermediary between sellers and buyers of businesses.Business brokers, also called business transfer agents, or intermediaries, assist buyers and sellers of privately held business in the buying and selling process. They typically estimate the value of the business; advertise it for sale with or without disclosing its identity; handle the initial interviews, discussions, and negotiations with prospective buyers; facilitate the progress of the "due diligence" investigation and generally assist with the business sale.

Types of services that a broker can provideSince each state's laws may differ from others, it is generally advised that prospective sellers or buyers consult a licensed real estate professional.Some Examples:* Comparative Market Analysis - an estimate of the businesses value compared with other businesses for a similar type. This differs from an appraisal in that businesses currently for sale may be taken into consideration (competition for the subject business).* Exposure - Marketing the business to prospective buyers.* Facilitating a Purchase - guiding a buyer through the process.*

Facilitating a Sale - guiding a seller through the selling process.* FSBO document preparation - preparing necessary paperwork for "Sale By Owner" sellers.* Hourly Consulting for a fee, based on the client's needs.* Preparing contracts and leases. (Not in all states.)Business brokers and sellersServices provided to seller as clientUpon signing a listing contract with the seller wishing to sell the business, the brokerage attempts to earn a commission by finding a buyer for the sellers' business for highest possible price on the best terms for the seller. To help accomplish this goal of finding buyers, a business brokerage commonly does the following:* Ensures Confidentiality--Brokers have established systems in place to protect the confidentiality of a business.*

Appraisals--Most business owners have no idea what their business is worth. Certified Business Brokers are trained in business valuation and can help business owners understand the true value of all their hard work and sacrifice. Learn more about appraisals at [1]* Market Knowledge--Brokers make their living selling businesses. They are in the market on a daily basis conversing with Buyers. A local business broker understands the local market as well as what a business is worth.* Saves time and stress* Listing the business for sale to the public, often on a Multiple Listing Service, in addition to any other methods.* Based on the law in several states, providing the seller with a business condition disclosure form, and other forms which may be needed.* Preparing necessary papers describing the business for advertising, pamphlets, tours, etc.*

Advertising the business.

Advertising is often the biggest outside expense in listing a business.* Being a contact person available to answer any questions about the business and to schedule showing appointments* Ensuring buyers are prescreened so that they are financially qualified to buy the business; the more highly financially qualified the buyer is, the more likely the closing will succeed.* Negotiating price on behalf of the sellers. The seller's agent acts as a fiduciary for the seller. By not being emotionally tied to the transaction, Business Brokers are in a position to more effectively negotiate on a Seller's behalf.

This may involve preparing a standard offer to purchase contract by filling in the blanks in the contract form.* In some cases, holding an earnest payment in escrow from the buyer(s) until the closing. In many states, the closing is the meeting between the buyer and seller where the business ownership is transferred and the businesses name is conveyed.Business brokers attract prospective buyers in a variety of ways, including listing limited details of available businesses on their websites and advertising in business newspapers and magazines. Brokers also directly approach prospective buyers and sellers to gauge interest.