What Does a Stock Broker Do?

So what does a stock broker do? Well, they provide us access to the stock market and can also offer advice on how to reach our financial goals.




There are movies, books and even documentaries, but what does a stock broker do exactly?

A stock broker is a registered professional whose main role is to trade (buy or sell) stocks or other securities on behalf of the individual or institutional clients.

Most stockbrokers also trade securities on their behalf as well to make profits.

Stock Broker Degree or Qualification

With the nature of the job done by stock brokers, most people do not know the exact courses or stock broker degree that qualifies an individual as a professional broker in the securities market. Below are the main degrees that an individual needs to pick from if they wish to start a career as a stock broker.

  • Accounting
  • Finance
  • Economics
  • Investments
  • Management marketing
  • MBA (Masters in Business Administration)

These are the top courses that you will choose from to kick-start a successful career as a stock broker. After getting your stock broker degree, you will then need to get licensed by the relevant authorities, and in the USA, for a stock broker to get a license he/she must pass series 7 and one of another exam between a series 63 or series 66 exam.

What Does a Stock Broker Do?

What Does a Stock Broker Do

Any individual or a company entity wishing to invest or trade in stock or securities market will need to seek the services of the stock broker. However, there are some company stocks that can be bought directly from the companies, but most of them will need the services of the stock broker. Below is a summary that answers the question: what does stock a broker do?

(1) – Execute Trade Orders

One of the main jobs of a stock broker is to execute (buy or sell) orders on behalf of his/her clients. Also known as a sales agent in the stock market, stock brokers connect buyers and sellers. They trade on behalf of their clients and are responsible for creating liquidity in the securities market.

When they conduct a trade on behalf of their clients’, they are paid
commissions. They also transfer funds that are gained or used from trading to the bank account of the client’s as well.

(2) – Provide Numerous Options to Trade

There are several options that stock brokers will provide to his or her clients to invest or trade in the stock or securities market. Besides shares, other investment or trade options include stock futures or options, currency futures or options, commodity futures, mutual funds investments, debt instruments such as bonds, equity delivery or intra-day among other securities.

(3) – Act as Consultants and Researchers in Financial Market

Stock brokers also offer consultancy services to the clients on investment or trade recommendations. They conduct extensive research on securities market including research about the company’s operations, profits, current trends and the general industry to come up with the most reliable and profitable plan or decision.

(4) – Monitor Client’s Investments

They also monitor the client’s investments and advice the clients on the best decision to make with their already existence investments either to make more profits/income or avoid losses.

Experienced brokers are experts in stock brokerage investments and can foresee the behavior of the stock investments made by their clients and inform them wisely to make better decisions. The stock broker’s capability of valuing stocks also enables them to inform their clients on the best investment decisions available.

(5) – Look for New Clients

For stockbrokers to conduct business, they are either employees or owners of the stock brokerage company. To succeed in stock brokering career, you should always strive to look for new clients to widen your customer base as well as increase your fees or commissions.

How Stock Brokers Make Money

So, we’ve answered the question: “what does a stock broker do?” now we’ll move on to how they earn money.

In summary, stock brokers make money through fees and commissions paid to them by their clients who they trade the stocks on their behalf. Some also charge fees on consultancy services that they offer to their clients.

Stock brokerage firms also earn huge interests from banks deposits made by them on their client’s behalf even though most of them are earned on a short-term basis. Stock brokerage is a successful career if hard work and discipline traits are maintained, some stock brokers even go on to become fund or hedge managers as well.

Pick a stock broker degree from numerous available options and start a fulfilling and exciting career in the stock or security market.

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