How to Start Your Own Brokerage Business
Forming your own stock brokerage business is a wonderful way to go for those who have the passion for investing in the markets, researching the markets and the ability to share and persuade people to get excited and take action on these opportunities. Stock brokerage firms generate their revenues by the commissions and fees charged to investors who wish to buy and sell stocks.
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Instructions
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Research on what all will be needed to start your stock brokerage company. This includes what contacts and clients can you bring in to your brokerage company as well as how you will attract new clients. Also, where you will locate your new business.
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Decide on whether you will register as a broker or you will affiliate or partner with an existing broker. If you decide to register as a broker, then you must pass the necessary examinations such as the Series 7 test.
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Perform the necessary due diligence by properly registering your stock brokerage company. This includes filling out the necessary paperwork and paying the appropriate fees to be recognized by the government, the stock exchanges and the Securities and Exchange Commission (SEC).
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Decide on the number of employees, including registered stock brokers, you will have to begin your new business.
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Choose the software system your employees will use to execute transactions on a regular basis. This is commonly referred to as a trading platform and will play a vital role in your stock brokerage business.
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Select the clearinghouse you will use to provide security for your company and insurance for your customers. Some of the clearing houses you can choose from include names like Goldman Sachs, JP Morgan and Morgan Stanley.
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Begin your new stock brokerage company and continue developing and growing your customer base by continually executing your marketing plan and getting the word out there about your services.
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Tips & Warnings
Make sure the stock brokers you hire are properly licensed and registered.
