How does the economy affect the stockbrokers at a time like this?

Posted by admin
Shane Uehara asked:


Don’t they make money either way by commission no matter if their clients are making money or losing? Even if they lost all the money, it is ultimately their own fault for getting themselves into the mess and not them right? The stockbrokers can always just live to trade another day when the economy change for the better again, no?

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    • This entry was posted on Saturday, March 6th, 2010 at 7:02 am and is filed under Finance. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

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    One Response to “How does the economy affect the stockbrokers at a time like this?”

    1. PENWESTERN Says:
      March 9th, 2010 at 12:24 pm

      Well, I will take a stab at this although I am not a stockbroker.

      I believe they make money when the client makes a trade. If the client sells I believe that is when he makes commission. A lot of people are selling so the stockbrokers are likely making $ for now.

      I do not know for sure if stockbrokers make money on a flat portfolio that does not trade. There may be some small annual fee but I am not sure.

      If customers decide in mass to go cash then the stock broker will likely be out of work and bankrupt if he/she bought stocks prior to this down market.

      It used to be a lucrative career if you are good at sales and people trust you. You must wear a suit and tie and sit in an important office perhaps at a bank or a downtown investment firm such as Goldman Sachs.