Personal Broker and Online Investing
Online investing provides a new investor to take complete control over their own portfolio, cutting down the role of a traditional broker. Both positives and negatives accrue to each approach that needs to be considered when investing finances are concerned. Do weigh in the pros and cons of each of them and even the styles before you start to invest.
With online investing, you can take complete charge of your own portfolio. During trading hours, trades can be executed, in comparison to a broker where you need to notify them if you are planning to purchase or sell certain stocks. The worst part is that they are going to act on these decisions as per their own convenience. Brokers, on the other hand, adopt a traditional mindset and their task is to help you make bad investment decisions. Yes, you could argue that they are not a magic wand where all decisions might go as per plan, but they resist you from making a rash decision.
Online tools provide you with various tools for proper research. Even the best online discount broker in India offers such tools and the best part is no extra charges are levied. With the help of such tools, you can make informed decisions about your investment needs. Brokers go on to undertake market research saving a lot of time along with effort at the end of clients. A broker goes on to serve as an advisor or mentor to a client, bringing their trading expertise to the fore as far as investment decisions are concerned. This exercise is undertaken by extensive research about the market.
For their clients, personal brokers end up providing numerous services. They levy charges on the basis of a single transaction, or it can be a share of the total profits. Online investing a lot fewer fees are levied. But still, you need to evaluate what you are paying for. The business presentation is the dog and pony show. The broker fees might be worth paying if they provide you with an untapped source of information or helping you in investment decisions. This could be an area that you might have passed over. Online investments relatively cheaper can succumb to be victims of fraud, scams or data being interpreted in a wrong way.
Personal brokers can be extremely valuable to an organization. With their experience, expertise, lack of proper understanding of various financial models and even professional connections they are an asset. In addition, personalized levels of services are provided to clients based on their investment philosophy, goals and risk tolerance. This is an area that online trading lacks. With stockbrokers, they are trying to be in a position where they are looking to earn themselves. Though outright fraud is pretty rare, a list of economic initiatives that you need to opt for trade-offs or actions that are going to benefit the brokers financially.
To conclude the choice of a broker eventually depends upon your investment needs or goals. Does proper research before you end up investing?