How to Find a Stockbroker

A good stockbroker can help you grow your investments.

Your stockbroker is an important professional in your life. Stockbrokers are basically agents who assist you in buying and selling stocks. They can manage the stocks for you and even give you advice about which stocks you should buy and which you should sell. They might also advise you on how much you should buy and sell at a time. Hiring an unqualified stockbroker can lead to losing thousands of dollars, so it's important to choose your stockbroker carefully.

Difficulty:

Moderate

Instructions

1. Understand the different types of brokers. You can choose an online stockbroker, which basically processes your purchases but doesn't help you pick stocks, or a full-service stock brokerage firm, which will provide you with a personal broker to help you pick, manage and process your stock sales and purchases. Discount firms, which are a mix of both, are also an option.

2. Schedule an appointment with your financial adviser at your bank. Your bank may have a stockbroker on staff or a stock brokerage firm to recommend. Your financial adviser can give you some guidance about the type of stockbroker you need.

3. Talk with other professionals you trust, such as your accountant and lawyer. Professionals like these often have a network for referrals and can direct you to stockbrokers who may fit your needs.

4. Use online resources, like TheStockBrokerDirectory.com, where you can search for stockbrokers by state and find one near you.

5. Check out a stockbroker's credentials before you hire him. One way to do this is through the Financial Industry Regulatory Authority, which provides background reports on stockbrokers, including those you can't actually meet because they work online. You also can find information on the stockbroker's firm.

Tips & Warnings

• Ask stockbrokers how they make their commissions. Some brokers are paid extra every time they persuade you to buy something, which may influence the advice they provide.

• You may not need to hire a stockbroker for all types of investments. While brokers are useful for advice on individual stocks, you may be able to invest in things such as mutual funds without having to pay extra for something you can research on your own.

References

• MainStreet: How to Find a Stockbroker

Resources

• TheStockBrokerDirectory: Stock Brokers
• Financial Industry Regulatory Authority