Any Stock Broker Should be Registered
Any Stock Broker you deal with should be registered with National Association of Securities Dealers (NASD) and the Securities and Exchange Commission (SEC). In addition, to protect your money after you have deposited it into a brokerage account, that broker should be a member of the Securities Investor Protection Corporation (SIPC). SIPC doesn’t protect you form market losses; it protects your money in case the brokerage firm goes out of business. To find out whether the broker is resgistered with these organizations, contact the NASD, SEC, and SIPC.
The distinction between personal stockbrokers and institutional stockbrokers is important. Institutional brokers make money from institutions and companies through investment banking and securities placement fees (such as initial public offering and secondary offerings), advisory services, and other broker services. Personal stockbrokers generally offer the same services to individuals and small businesses.
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