Duties of a Stock Broker
Stock brokers have a lot of responsibility because they are dealing with their clients' money and financial future. Brokers must be honest and conscientious individuals who strive to help their clients achieve financial success. Brokers also must be friendly and trustworthy in order to gain the trust of their clients and prospects. If a broker possesses these qualities, he will be successful in carrying out the following varied duties required in his profession.
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Recruit New Clients
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One of the main responsibilities of a stock broker is to recruit new clients. Brokers use several tactics to attain new clients. They cold call prospects, introduce themselves and offer a free consultation. Brokers contact the people they know such as family members, friends and past co-workers. They ask their current clients to refer their friends and family to them. Brokers also hold free seminars in their community where they offer advice on a financial topic such as planning for retirement. The broker's hope when holding these seminars is that some attendees will become clients.
Build Relationships with Clients
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A major attribute of good stock brokers is that they know how to build relationships with their clients. After a broker gets a new client he must learn about the client's financial situation and goals. He also must understand the client's tolerance for risk. Brokers need to get to know their clients in order to be able to give them appropriate advice and plan long term investment strategies that will meet their financial goals. Brokers should build a trusting relationship with their clients so that they remain clients for a long time.
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Advise Clients
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After a broker understands a client's financial situation and the goals they are striving for she will make recommendations regarding the client's investment portfolio. The broker will use her knowledge and training to advise the client about portfolio changes and new investment opportunities. Brokers must always have the client's best interest in mind when making recommendations. Also, they are required to only give advise that is suitable for the client's goals, financial situation and risk tolerance.
Execute Trades
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When a client decides to buy or sell an investment, the broker fills out the appropriate forms and executes the trade. It is the broker's responsibility to ensure that the trade was filled properly.
Monitor Clients' Portfolios
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It is the broker's duty to keep watch over his clients' investments. If market conditions shift or a client's financial situation changes the broker must recommend the appropriate course of action. As a result, it is important for a broker to keep in close communication with his clients. The broker also must have a deep understanding of the markets and watch the market action on a daily basis.
Warning
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If a broker does not act in his client's best interest at all times he can face disciplinary action by the Financial Industry Regulatory Authority, or FINRA. FINRA is the organization that is mandated by the Securities and Exchange Commission to regulate the stock market and ensure that all stock brokers and financial advisers obey all rules and regulations.
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