A Broker is an individual or firm that acts as an intermediary between an investor and a securities exchange. Because securities exchanges only accept orders from individuals or firms who are members of that exchange, individual traders and investors need the services of exchange members. Brokers have three primary functions: to provide customers with information about the markets, to execute customer orders, and to maintain relationships with other market participants.Brokers are typically registered with the Securities and Exchange Commission (SEC) and must comply with a variety of regulations designed to protect investors. For example, brokers must disclose any potential conflicts of interest they may have in order to ensure that their recommendations are not influenced by self-interest. They must also make sure that their customers understand the risks associated with investing in specific securities products.The role of a broker has evolved over time as new technologies have emerged. In today's electronic markets, brokers can use sophisticated computer algorithms to quickly execute customer orders at the best possible price available on the exchanges.
