How does an online broker work?

Your online broker acts as an intermediary, connecting you to the stock market. When you use an online broker to buy and sell shares of stock, the broker routes your orders a market center to be filled, and you receive the shares. Your brokerage account is where the shares of all the companies you own are held until you are ready to sell.

What is a broker in finance?

Brokers are common in the financial world. For example, in finance, they work on behalf of clients trading bonds, stocks, and other financial products. The Financial Times FT Lexicon says the following regarding the meaning of broker: “Generally, an intermediary who helps to effect (who brokers) a transaction between two parties.

What does a stockbroker do?

A stockbroker is an agent or firm that charges a fee or commission for executing buy and sell orders submitted by an investor. A brokerage company's main responsibility is to be an intermediary that puts buyers and sellers together in order to facilitate a transaction.

What is a broker-dealer?

Broker-dealers are those that perform both responsibilities, such as traditional Wall Street organizations, as well as large commercial banks among others. "Broker" and "dealer" are U.S. regulatory terms and, as is often the case with legal terms, they are not very intuitive to many people.