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Broker

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A broker is a party that arranges transactions between a buyer
Buyer
When someone gets characterised by their role as buyer of certain assets, the term "buyer" gets new meaning:A "buyer" or merchandiser is a person who purchases finished goods, typically for resale, for a firm, government, or organization...

 and a seller
Sales
A sale is the act of selling a product or service in return for money or other compensation. It is an act of completion of a commercial activity....

, and gets a commission
Commission (remuneration)
The payment of commission as remuneration for services rendered or products sold is a common way to reward sales people. Payments often will be calculated on the basis of a percentage of the goods sold...

 when the deal is executed. A broker who also acts as a seller or as a buyer becomes a principal party to the deal. Distinguish agent: one who acts on behalf of a principal.
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In general a broker is an independent agent used extensively in some industries. The prime responsibility of a broker is to bring sellers and buyers together. Therefore, a broker is the third -person facilitator between a buyer and a seller. An example would be a real estate broker who facilitates the sale of a property.

Brokers also can furnish considerable market information regarding prices, products and market conditions. Brokers may represent either the seller (90 percent of the time) or the buyer (10 percent) but not both at the same time. An example would be a stockbroker, who makes the sale or purchase of securities on behalf of his client. Brokers play a huge role in the sale of stocks, bonds and other financial services.

There are advantages to using a broker. First, they know their market and have already established relations with prospective accounts. Brokers have the tools and resources to reach the largest possible base of buyers. They then screen these potential buyers for revenue that would support the potential acquisition. An individual producer, on the other hand, especially one new in the market, probably will not have the same access to customers as a broker. Another benefit of using a broker is cost — they might be cheaper in smaller markets, with smaller accounts, or with a limited line of products.

Etymology


The word "broker" derives from Anglo-Normandian brocour "small trader," of uncertain origin, but possibly from Old French
Old French
Old French was the Romance dialect continuum spoken in territories that span roughly the northern half of modern France and parts of modern Belgium and Switzerland from the 9th century to the 14th century...

 brocheor "wine retailer," which comes from the verb brochier "to broach (a keg)."

Types of brokers


  • Aircraft broker
  • Auto broker
  • Broker-dealer
    Broker-dealer
    A broker-dealer is a term used in United States financial services regulations. It is a natural person, a company or other organization that trades securities for its own account or on behalf of its customers....

  • Brokerage firm
    Brokerage firm
    A brokerage firm, or simply brokerage or broker in context, is a financial institution that facilitates the buying and selling of financial derivatives between a buyer and a seller...

  • Business broker
    Business broker
    who/which acts as an intermediary between sellers and buyers of small businesses.Business brokers, also called business transfer agents, or intermediaries, assist buyers and sellers of privately held small business in the buying and selling process...

  • Commodity broker
    Commodity broker
    A commodity broker is a firm or individual who executes orders to buy or sell commodity contracts on behalf of clients and charges them a commission. A firm or individual who trades for his own account is called a trader. Commodity contracts include futures, options, and similar financial...

  • Customs broker
  • Information broker
    Information broker
    An information broker, also known as an independent information professional or information consultant, is a person or business that researches information for clients...

  • Insurance broker
    Insurance broker
    An insurance broker finds sources for contracts of insurance on behalf of their customers. The three largest insurance brokers in the world, by revenue, are Aon, Marsh & McLennan, and Willis Group Holdings.-Purpose of insurance brokers:...

  • Investment broker
    Investment broker
    Investment brokers are individuals who bring together buyers and sellers of investments. They need a license to operate. They act on behalf of buyers and sellers of stock...

  • Joint venture broker
    Joint venture broker
    Joint venture brokers are people who connect business joint venture partners together for profit making projects. The joint venture brokers will earn a pre-negotiated percentage of the profits earned from the joint venture that they helped put together....

  • Leasing broker
  • List broker
  • Marriage broker
    Matchmaking
    Matchmaking is any process of matching two people for the purpose of marriage or a sporting contest.-Practice:In some cultures, the role of the matchmaker was and is quite professionalized...

  • Mortgage broker
    Mortgage broker
    A mortgage broker acts as an intermediary whose brokers mortgage loans on behalf of individuals or businesses.Traditionally, banks and other lending institutions have sold their own products. However as markets for mortgages have become more competitive, the role of the mortgage broker has become...

  • Options broker
    Options broker
    Options brokers specialize in offering options trading, research, education and other tools to individual investors. In addition to common options trades like covered calls, option spreads, and straddles, many options brokerages offer trading in products related to options, including stocks, ETFs,...

  • Power broker (term)
    Power broker (term)
    A power broker is a person who can influence people to vote towards a particular client in exchange for political or financial benefits. Power brokers can also negotiate deals with other power brokers to meet their aims....

  • Prime broker
    Prime brokerage
    Prime brokerage is the generic name for a bundled package of services offered by investment banks and securities firms to hedge funds and other professional investors needing the ability to borrow securities and cash to be able to invest on a netted basis and achieve an absolute return...

  • Real estate broker
    Real estate broker
    A real estate broker, real estate agent or realtor is a party who acts as an intermediary between sellers and buyers of real estate/real property and attempts to find sellers who wish to sell and buyers who wish to buy...

  • Retail broker
  • Ship broker
    Shipbroking
    Shipbroking is a financial service, which forms part of the global shipping industry. Shipbrokers are specialist intermediaries/negotiators between shipowners and charterers who use ships to transport cargo, or between buyers and sellers of ships.Some brokerage firms have developed into large...

  • Sponsorship broker
    Sponsorship broker
    A sponsorship broker is an individual, or agency, that procures sponsorship funding for properties...

  • Stock broker
    Stock broker
    A stock broker or stockbroker is a regulated professional broker who buys and sells shares and other securities through market makers or Agency Only Firms on behalf of investors...

  • Office broker
    Office broker
    An office broker is a more general term for a serviced office broker. The office broker company/ individual arranges transactions between a company or individual interested in renting office space and a business centre/ office space owner. Office brokers help business centre owners to advertise...

  • Serviced office broker
    Serviced office broker
    A serviced office broker is a company or individual that arranges transactions between a party interested in renting serviced office space and a business centre/ office space owner...