A Broker is an individual or firm that acts as an intermediary between buyers and sellers to facilitate transactions. Brokers are typically involved in financial markets, real estate, insurance, and commodities. Their role is to match buyers with sellers and may also provide advice or specialized services related to the transaction. Brokers often charge a commission or fee for their services.
Types of Brokers:
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Stock Broker – Facilitates buying and selling of stocks and other securities.
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Real Estate Broker – Helps clients buy, sell, or rent properties.
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Insurance Broker – Assists clients in choosing insurance policies and finding the best terms.
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Commodity Broker – Deals with the buying and selling of commodities like oil, gold, and agricultural products.
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Forex Broker – Facilitates trading in foreign exchange (currency) markets.
Key Functions of a Broker:
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Matching buyers with sellers
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Negotiating deals
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Advising clients on market conditions (especially for financial brokers)
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Executing transactions on behalf of clients
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Ensuring compliance with regulations (in regulated markets)
Example:
A stockbroker assists an investor in purchasing shares of a company and charges a commission for the transaction. Similarly, a real estate broker helps a person sell a house by finding a buyer and taking a percentage of the sale price as their commission.