How to interact with a broker?

How to interact with a broker?

How to interact with a broker?

Make a contract with a broker. Study the terms and conditions of the brokerage agreement and https://telegram-store.com/catalog/product-category/channels/economics. As a rule, brokers publish the standard contract with the rates on their website. If you are satisfied with the rates and other terms, you can make an agreement in the broker’s office or send notarized documents by mail. Major banks with a brokerage license often offer to sign an agreement remotely, through their website or a mobile app.

Open an account with the broker and put money into it. Then the broker can buy securities for you. If you plan to invest in the stock market for more than three years, it is more advantageous to open an individual investment account (IIA), which will save you on taxes.

Set up a securities account. The securities you buy must be accounted for somewhere. To do this, you must open a custody account (an account for recording securities) with a custodian. The depository may be a separate company, unrelated to your brokerage. But often, in addition to a brokerage license, a broker also has a depository license and combines these two functions.

Now you are ready to trade on the exchange – you can give orders to your broker to buy and sell securities. You can do this by telephone, online – with a special program – a trading terminal or via a mobile application of the broker.

The broker executes operations on the stock market on your behalf. In addition to money for the purchase of securities, a commission is deducted from your brokerage account – a fee for helping you carry out these operations. You can use the broker to make withdrawals to your bank account. You may also be charged a fee for this. The broker will calculate and withhold tax on your income.

Before accepting an order for a transaction, the broker must warn you about the costs of the transaction – for example, commissions to the stock exchange and the broker himself.

The intermediary must also inform you of the current bid and ask prices of the chosen financial instruments. Some securities may be illiquid, meaning that it will be difficult to find a buyer for them at all.

It is up to the broker to choose how to provide you with additional cost data. It may simply be a link to a page on his website. Make sure in advance that the information is clear and you will be able to quickly understand it.

If the broker does not inform you of all the nuances and you incur losses because of this, you will have the right to claim compensation for losses, including through the courts.

There are situations when it is important to make transactions very quickly. Then you can refuse to receive warnings about additional expenses, so that the broker executes your orders immediately. But in this case it will not be possible to make a claim against the intermediary because of losses, which will be related to the lack of information.