Last Updated on Dec 24, 2019 by James W

Brokers. You’ve seen them everywhere, in films and books and sometimes in real life. The stereotypical image of a smooth talking, up to date and ruthlessly resourceful broker is one of the most common tropes in fiction.

But how do these brokers make their money? Is it really all about shady business deals and moral corruption, as films like the Wolf of Wall Street would have us believe? If you’re someone who is interested in being a broker, then you’re going to want to know how the whole thing works, so let’s pick it apart.

So What Does a Broker Do?

So let’s talk about what the broker does. A basic explanation never did anybody any harm after all, and I can help when it comes to figuring out the intricacies of different types of brokers.

At a very fundamental level, the broker is a middleman. They act as the contact point between the seller of the product and the buyer. In return for introducing the two in helping to orchestrate a deal which benefits both parties, the broker walks away with a little bit of money themselves. The different levels of broking can vary of course, but the fundamental duties are clear.

Are There Different Types of Broker?

So like a lot of professions, there are multiple types of broker for people to choose between. You can find a broker for pretty much any instance you can think of, whether it is real-estate or stocks. So whether you’re looking for a sale and purchase shipbroker, or a stock broker, there is typically an expert who can work with you and give you exactly what you need.

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Can a Broker Make Money Another Way?

So it’s pretty evident that a broker can make money another way if they need to, but the actual specifics aren’t always clear. You see, a broker can typically operate in a handful of different ways. For example, some work on commission whereas others take a proportion of the proceeds depending on the situation. It’s all down to how reputable the broker is and the level they are trading at. Many brokers offer their services on retainer, which means they get paid a certain amount every month in exchange for being on hand to help whenever it is needed.


How you operate as a broker is up to you, but the level of training that you have will determine how well you do. Some brokers have degrees and can evidence their proficiency and thus justify their higher rates, but there are many who operate as freelancers and thus have more flexible rates.


So you can probably tell that there are a lot of reasons why someone should consider becoming a broker. It is a highly profitable venture which can see you trade at some of the highest levels of retail, and at the same time could see you earn a tidy packet in the stock world. However, it is important to realise that sometimes your earning potential is capped by the amount of experience you have as broker. Those who are less qualified may find that they struggle to accumulate more expensive deals, and freelancers may struggle most of all. What is important is that we establish that stockbrokers and brokers in general do not conduct business via dodgy side deals, and that the actual stock is a very meticulous and precise process that keeps to the law where possible.The broker can find that their career fluctuates according to the stock industry, and this is also important to be aware of.

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