A stockbroker is a person who receives a fee or commission to carry out and execute a purchase or sale transaction on behalf of an investor or trader.
In addition to executing buy or sell orders on behalf of traders, stockbrokers provide services such as market colour, research, and news to their customers.
In the United States, brokers operate under the Financial Industry Regulatory Authority- which is a private entity which acts as a regulatory body alongside the US Securities and Exchange Commission. Stock broker’s activities are heavily regulated to ensure that they are upholding their fiduciary duties to act in the best interest of their clients, the traders.
Nowadays, online discount brokers have become extremely popular. They allow traders to execute trades at a lower cost than a typical stock broker. They are typically 24/7, but do not provide the benefits of market colour, research, and news. With the onset of discount brokers available, the number of stockbrokers in the United States have dwindled, with 630,132 registered in December 2017 compared to 672,688 the register in December 2016.