What Is a Broker? A Complete Beginner’s Guide
By Sameer Basnet
A broker is a platform or individual that allows investors to buy and sell assets like stocks, ETFs, and bonds. Without brokers, access to financial markets would be extremely limited.
Types of Brokers
Full-Service vs Discount Brokers
Full-service brokers provide investment advice and portfolio management, while discount brokers focus on low-cost trade execution with minimal support.
- Full-service brokers: advisory + portfolio management
- Discount brokers: low fees, self-directed trading
- Online brokers: fast and accessible platforms
How Brokers Make Money
Brokers earn revenue through commissions, spreads, and premium services. Some platforms advertise zero commission but monetize in indirect ways.
“If you're not paying for the product, you might be the product.”
Always check hidden fees like spreads, withdrawal charges, and inactivity fees before choosing a broker.