Broker vs. Trader?
- Thread starter NYCFinest
- Start date
one makes his money in a pasive way, the other loses his money in an active way 
) muhahahaha
) muhahahahaA broker typically connects a buyer and a seller and acts as an intermediary for a trade. He takes on no risk and earns a commission for his services. A trader assumes risk from the transaction.
For example, you call a broker on the NYSE and ask where you can buy 50,000 shares of IBM. He asks the crowd. A trader in the crowd says heâll sell you 50,000 shares for $128. You instruct the broker to buy the shares. The broker buys the shares from the trader for $128 and sells them to you for $128. The broker never has any risk in the transaction, and you pay him a commission for his service. The trader on the floor is now short 50,000 shares of IBM and has assumed the risk.
For example, you call a broker on the NYSE and ask where you can buy 50,000 shares of IBM. He asks the crowd. A trader in the crowd says heâll sell you 50,000 shares for $128. You instruct the broker to buy the shares. The broker buys the shares from the trader for $128 and sells them to you for $128. The broker never has any risk in the transaction, and you pay him a commission for his service. The trader on the floor is now short 50,000 shares of IBM and has assumed the risk.
A broker is an over glorified used car salesman. Usually cold call to get clients. Most of em don't shit other than what their firm tells em. They actually get inventory lists of stocks to move at some firms.
I know this to be a fact because I used to be one. Those that are really in the know, often become traders, or money managers at independent firms. I really mess with them when I get the occasional call.
I know this to be a fact because I used to be one. Those that are really in the know, often become traders, or money managers at independent firms. I really mess with them when I get the occasional call.
Quote from nazzdack:
Korchnoi has been waiting more than 3 years for somebody to ask that precise question!
How funny is that. 3 years and now he decides to post.
Talk about waiting for your moment. Wonder what his trading day looks like. LOL... not now, gotta be patient...
Broker is to trader as car salesman is to race car driver.