Importance of Brokers in the Stock Market

Aug-20-2022Blog by – Mr. Ashish AjmeraRead Time: 4 Min.Word Count: 504
251Importance of Brokers in the Stock Market
When you want to buy or sell shares on BSE or NSE stock exchange, you can’t trade directly.
You will need the help of share market brokers.

A share market broker is an individual or a firm who executes a buy or sell transaction on
your behalf for a fee or commission. They are registered members of the Securities and
Exchange Board of India (SEBI). They offer services to both individual and institutional
investors. There are two types of stock brokers:

Discount Brokers: They offer vanilla or no-frills services. They operate through an online
trading platform and charge a lesser fee or commission. They do not perform any other
stock broking activity for you.
Full-Service Brokers: They offer end-to-end services, right from trading to advisory. They
charge significantly a higher fee than discount brokers. It makes more sense to avail
their services if your portfolio size is large and includes different types of investments.

What Does a Stock Broker Do?
The services of a stock broker entail the following:

1. Buy and Sell
This is the basic online service that all stock brokers facilitate for investors. They may also
assist you to set up a trading and Demat account if you are a first-time trader.

2. Stock Research
It can be a time-consuming activity to conduct detailed research on which stocks to buy.
Since stock brokers have insider market insights and monitor market trends closely, they can
do comprehensive research on various stocks, their past performance, company vision,
board of directors, and other parameters and provide the right advice accordingly.

3. Portfolio Management
If your portfolio is spread across different assets and securities such as equity, bonds,
mutual funds, currency, depositories, and others, a stock broker can manage it on your
behalf. Right from evaluation of options, stock picking, and order execution to settlement,
performance monitoring, and reporting, you can trust the entire portfolio management to
the stock brokers.

4. Personalized Services
Every investor has different financial goals and risk appetites. What works for one investor
might not work for you. Stock brokers assess your financial needs on various parameters
and recommend a tailored investment plan for you.

5. Paperwork
Every share transaction involves a lot of paperwork and documentation, whether physical or
electronic. Stock brokers can handle all the administrative work and relieve you of these

6. Foreign Exchange Market
If you wish to invest in the international stock market, it requires elaborate research and in-
depth knowledge. International markets operate in highly-sensitive conditions and you
could incur losses if you don’t trade with caution. Some stock brokers also offer currency
and forex trading services.

Ajmera x-change is one of the most reputed and trustworthy online stock market brokers in
India. Their range of services includes stock and security trading, equity investment
advisory, portfolio management, currency trading, wealth management, and margin
financing among many others. Its other offerings comprise sophisticated and innovative
processes, extensive analysis, a powerful trading platform, and an integrated mobile app.
Get in touch to know more.
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