If you have ever been confused as to how to get started selecting a stock broker, here are five quick tips to help you as you begin your searching:
1) Know your goals! If you know what you want to accomplish, then choosing someone to help you will be much easier because you will know the right questions to ask. Would you be happy with a 10% return with a maximum amount of risk? Do you want to day trade futures and attempt to make large rates of return? Do you want to have someone make all of the decisions for you so that you do not have to spend the time to learn the market’s nuances? Ask yourself the appropriate questions so that you can choose the correct broker or other services (software, subscription services, etc.) for your specific goals.
2) Ask yourself how much time you are willing to invest in managing your finances. If it is very little as you have other responsibilities or obligations or interests, consider managed account services. If you are willing to be more hands-on, consider firms which allow for more “self-directed” activities.
3) Ask yourself how much risk you are willing to take. This is a BIG one and gets right to the heart of many of the rules by which brokerage firms must comply, including the “Know Your Customer Rule.” Once you are comfortable with your pre-set level of risk, you can make MUCH more informed decisions.
4) Ask for referrals from people you know with the SAME goals and risk tolerances. A recommended broker, with an emphasis on high-frequency day trading, probably is not going to give you the same sort of research and customer service if you have a longer-term time horizon for your trades and you highly value customer attention from your broker. Choose referrals from those with the same goals you have.
5) Check on your broker. The regulators in the U.S. offer you a chance to review brokerage firms and their brokers. Here is the link: http://www.finra.org/index.htm (or http://www.finra.org/InvestorInformation/InvestorProtection/ChecktheBackgroundofYourInvestmentProfessional/index.htm)
Hopefully these quick tips will help you find the right broker for your needs!
Author: Matthew Mc Dermott
Article Source: EzineArticles.com
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