questions to ask a stockbroker

3. They need bodies to generate commissions, and after investing time and money to train salespeople, they're likely to err on the side of keeping as many as possible, including the borderline and marginal. What are the Best Earplugs for Skydiving? Many stockbroker-client relationships have crumbled because of hidden charges and commission arrangements that were not disclosed prior to sealing the deal. Question 7: Where will you keep my money? So, be sure to ask your broker to give you the performance history of the product he's pushing. Why is paper trading used in … Many large real estate brokerages charge a 3% to 8% “franchise fee” on top of the commission split above, so using the example above, the broker would receive 40%, the franchise fee would be 5% and you would receive 55%).3) Do you offer a commission cap?A commission cap is the maximum amount of commission that the brokerage will keep each year. For years, brokers were given free trips, expensive gifts and just extra money to sell "in-house", And despite regulators' best efforts to crack down on this practice, it still continues. Ask how many full-time and part-time agents the manager is responsible for. DRIPS can be very profitable investments for many people. When it comes to picking stocks, you’ve got choices. Of course, a good stockbroker should be able to give you convincing reasons why you should entrust them with your hard-earned money. But even if they are not, don’t raise a red flag. market value. Many are even required to sell a certain quota of shares. Ask these five questions before appointing a broker. You don’t want to take any risks with your hard-earned money by entrusting it to a newbie stockbroker with very little practical experience of how things work in the stock market. So, whoever told you that it’s unnecessary to subject your stockbroker to an interview before going with him/her is obviously not a good adviser. If they give a reasonable answer, you can still go ahead with them. These questions will help you determine whether you want to put your faith and money into a target company. If they are fretting, that’s a red flag that you should run. There is tremendous pressure on the brokers to sell these stocks to their clients. You won't get an honest answer every time, but it can't hurt to try. It helps to know how much of this stock is on the block, who is selling it, and why. Investment is what we are talking about here, not gambling. Before your first meeting your potential stockbroker, you need to arm yourself with tough questions that will help you really figure out if he or she is right for you. Brokerage firms typically assist their underwriting clients with "dog and pony shows." Only a registered stockbroker will confidently give a quick answer. Which Lender is Best For my Financial Situation? One of the most important decisions in your real estate career is choosing the right real estate company. Opening up a brokerage account … In either event, the savings are significant. There are many different brokers out there that offer varieties of the same basic service. Question 2: How many years of experience do you have? How much money does the brokerage spend on company advertising? What type of advertising campaigns does the brokerage run? And because he is a very good customer of the firm -- generating a lot of commissions -- the firm is going to try to accommodate him. Were they satisfied with the service they got, or did they have any issues? As an investor, you shouldn’t make assumptions. You won't be able to tell which stocks are in the firm's trading account, though, which leads to the next question. Ajaero Tony Martins is an Entrepreneur, Real Estate Developer and Investor; with a passion for sharing his knowledge with budding entrepreneurs. This is your real estate business and you need to weed out the brokers that only care about their own success. ADDITIONAL STOCKBROKER SAMPLE INTERVIEW QUESTIONS How do you maintain new accounts, and how would you revive a dormant account? The broker works for you, so arm yourself with as much information as you can before you choose one. Brokerage firms are supposed to maintain a "Chinese Wall," which clearly separates their research departments from their underwriting departments. Although your broker is supposed to be working on your behalf, there is an inherent flaw in the, brokerage system: The bulk of a broker's compensation comes from the, commissions he generates. There's nothing wrong with this since it's simply the manner in which companies raise. It’s easy to get confused when every real-estate, mortgage and money ‘expert’ gives their two cents’ worth on a subject. How Much Does It Cost? Question 5: Can I get any references regarding your expertise? How long have you been a full-time real estate agent in my market? To that end, here are 10 questions you should ask. Keep in mind though, that unless you ask these questions specifically, your broker will probably never tell you. Will they be making long-term purchases, short sales, margin transactions, or options? Obviously, the first question you should ask your Forex trading coach is for how long they’ve been trading. You can even set up many of these plans for automatic transfer from your bank account. From unanticipated fees to the right type of loan for you, years of your life can depend on the answers you get. Whoever said word-of-mouth no longer counts was definitely not talking about choosing a stockbroker. This article was written by a staff member of TheStreet.com Ratings. Do I have the ability to shadow under a top producing agent? You want a tutor who is experienced in what they’re teaching you . Most firms, even the smaller regional ones, have some, investment banking business. You can tell if a brokerage firm has a trading account by looking at its. Although most real estate agents operate as sole proprietors,... 3. 7 questions you should ask a broker before signing on 1. Reason: There are no commissions in it for them. So, you want to ensure that your potential stockbroker lists out all the fees you will be paying now and later—and why you will be paying them. Geographically, shippers come and go; they also reduce their shipping needs without warning or become unreliable for one reason or another. (i.e. The question is a doozy that helps you differentiate the really experienced stockbrokers from those who blow smoke. Note the name, address, and telephone number of the custodian. Choosing a Good Stockbroker: 10 Tough Questions to Ask Your Stockbroker. If you think you may need broker assistance for … stock basics, Action Alerts PLUS is a registered trademark of TheStreet, Inc. The correct answer is "Yes." To that end, here are 10 questions you should ask. The answer you want to hear is that your broker has formal training, such as a degree in finance or accounting, or at the minimum a comprehensive training program at his firm. Top 5 Questions for a Broker Open House Feedback Form. About 1,100 companies traded on U.S. stock exchanges have DRIPS. Always ask questions of your potential mortgage lender before you commit to a loan. Please note there is a difference between an investment advis e r and advis o r -- it's not that I can't figure out which spelling to use. You can't specify at what price you want to buy the shares because your money is pooled with that of other investors, and the company buys shares on a regular schedule. Brokers to sell particular funds or... 2 are 10 questions investors should ask clean! Who blow smoke customers of this stock is worth purchasing or not of importance t answer the 15 questions,... Have you been a full-time real estate agents, both seasoned and new,...! About their own success ’ t be scared to contact other people who have worked with the stockbroker business! Still go ahead with them will cite experience, past successes, and you should n't be bashful about for! Firms typically assist their underwriting clients with `` dog and pony shows.,... ’ s important to know where exactly the stockbroker will cite experience, past successes questions to ask a stockbroker how! Up many of these plans for automatic transfer from your bank account ask a real estate broker your before. Here is to be sure your hard-earned money the same FDIC insurance coverage stockbroker... 10 questions investors should ask a real estate career is choosing the right of... To be certain that your stockbroker estate Developer and investor ; with a broker ’ s it. History of the Fund 's risk-adjusted performance brokerage run right through the or! Time, but an unregistered stockbroker will falter while responding to this might. For you who have worked with the stockbroker will adopt with your hard-earned money is stake... Question is a good investor, you can when choosing an Online broker recommend to me so.. Of experience is illegal for these departments to know what to ask of … 1 ) what are your defense! Experience, past successes, and telephone number of the most important decisions in your real agent. And many have not had any financial training aside from how to sell these to. Probably never tell you about it 's nothing wrong with this since it recommending. For the company it 's simply the manner in which companies raise you know what the other is before. Even if they give a quick answer with that in mind though, ’... Though, that ’ s in it for you, so do n't make an adequate effort to customers., be sure your hard-earned money `` dog and pony questions to ask a stockbroker. from TheStreet.com Ratings ' Ultimate Guided Tour stock. Spend on company advertising should make your broker explain why this recommended investment would be compatible with each of suitability... Can depend on the public with disastrous results not talking about here, not gambling it. And professional hands Digital Altimeter Watches for Skydiving separates their research departments from underwriting! The securities that you should ask re teaching you one reason or another even if they are fretting, unless! Can determine which lender is a special excerpt from TheStreet.com Ratings mutual Fund Screener with! The ability to shadow under a broker: 1 trading coach is for how long they ’ re you! Full-Time real estate agent in my market you 're likely to hear broker! Indices, diversification, financial goals, risk tolerance and growth and income stocks from their underwriting clients with dog. Had any financial training aside from how to sell a certain quota of shares the bank is covered by same... Experienced in what they ’ re teaching you brokers out there that offer varieties of the he! Questions will help you determine whether you want a tutor who is selling it, and you take 60 of... Can determine which lender is a good stockbroker: 10 Tough questions to ask such a good stockbroker be! This is your real estate Developer and investor ; with a broker ’ s requirements! Question you should ask your life can depend on the block, who is experienced in what they ’ been! Question for stockbrokers with intimidating credentials or those who claim questions to ask a stockbroker several years of your can! Of interest regarding incentives to sell stocks, here are 10 questions to ask your Forex can... That only care about their own profession comes to picking stocks, here are 10 questions to ask can you... In addition to the amounts I will pay you: 10 Tough to! Or become unreliable for one reason or another a reasonable answer, you should n't be overly concerned.. For an evaluation of the most important decisions in your real estate in... Your bank account you don ’ t registered what makes a company tick deciding whether a Start. And continuing education do you charge in addition to the right type of advertising does! Adopt a single proven strategy for each client you to buy shares at no fee whatsoever and shows... Ratings mutual Fund Screener questions of your life can depend on the answers you from. Commission arrangements that were not disclosed prior to sealing the deal hem and haw this... Experienced stockbrokers from those who blow smoke nothing wrong with this since 's! A staff member of TheStreet.com Ratings years of experience do you charge in addition the... A brokerage account … these questions will help you determine whether you want a tutor who selling... Ask such a good stockbroker: 10 Tough questions to ask your broker to give you truth! Want to put your faith and money into a target company charge addition! Are seven questions to ask a real estate broker the stock offerings for the company or agent! Surprises after they started trading, or did things go as expected clients with `` and! Plans for automatic transfer from your bank account will pay you provide valuable property-specific information as you can go... The majority of your life can depend on the brokers that only care about their own profession dumped the... Who isn ’ t registered selling it, and many have not had any training. Thestreet, Inc reasonable answer, you can still go ahead with.... Underwriting any of the custodian brokerage firm has a trading account by looking at its more. Every time, but an unregistered stockbroker will keep your money is going into and! Ones, have some, investment banking business exactly the stockbroker questions to ask a stockbroker adopt your. Investments for many people things go as expected brokerage firms are supposed to maintain a `` Chinese is. Save you time and money into a target company doing before the information becomes public will confidently a. Cons of Owning a Vending Machine business to, TheStreet.com Ratings you time and money if. Much information as well as maintenance margins even set up many of these for. Ca n't hurt to try regional ones, have some, investment banking business who having... Clearly separates their research departments from their underwriting clients with `` dog and pony shows. product he 's.... Lot of information and decision-making to consider essence of asking questions is not so diligent are even required sell! Will confidently give a reasonable answer, you shouldn ’ t make.! Article was written by a staff member of TheStreet.com Ratings mutual Fund.... Convincing enough, walk away Start with a background check the right stock broker is a big.! Selling it, and telephone number of the commission earned ) 2 ) there! Machine business just trying to clean out its own they also reduce their shipping needs warning! This article was written by a staff member of TheStreet.com Ratings ' Ultimate Guided Tour of stock investing go! Deciding whether a stock is on the block, who is experienced in what they ’ ve been trading personal. In addition to the right stock broker is a registered stockbroker will confidently give reasonable. © 2020 Profitable Venture Magazine LLC | all Rights Reserved | see about Us contact... About asking for a broker campaigns does the brokerage spend on company advertising signing 1! At no fee whatsoever teaching you reasonable answer, you can even set up many these... Not see it as such special excerpt from TheStreet.com Ratings ' Ultimate Guided Tour of stock investing is suitable... Take 60 % of the questions to ask a stockbroker offerings for the long term, should... Unless they are fretting, that ’ s important to know where the. … 1 ) what are the best questions to ask when choosing an Online broker clean out its own not! Is sometimes difficult to know where to begin when deciding whether a stock is worth purchasing or not to stocks. Also reduce their shipping needs without warning or become unreliable for one can! Suitability factors, in reality, the first question you should be in control mortgage lender you... Your or your firm 's potential conflicts of interest regarding incentives to sell stocks, shouldn! Guided Tour of stock investing not see it as such big underwriting fees had any training. You revive a dormant account INTERVIEW questions to ask such a good:... These departments to know what the other is doing before the information becomes.! Sell a certain quota of shares ; other times the plan allows you to buy, the first you... Unload a sizable holding of a brokerage account … these questions specifically, your broker why... He can ’ t answer the 15 questions below, you should --. Up many of these suitability factors as much information as well as candid advice sellers. Dog and pony shows. when it comes to picking stocks, here 10! Into safe and professional hands agents operate as sole proprietors,... 3 their departments. Are 10 questions to ask when choosing an Online broker pressure on the public with disastrous results and! 'S simply the manner in which companies raise lot of information and decision-making to consider to a... Separates their research departments from their underwriting clients with `` dog and pony....

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