Stock brokerage companies are those organizations or corporations, which provide information and other services for dealing in stock market products. These stock brokerage companies essentially need to cover full authorization or membership of the parent stock exchanges for which they are operating in their concerned area.

Stock Brokerage has become a large scale business for professional companies after the advent of information technology. It has made it easy to operate and monitor the transactions on the screen of computers. Previously the stock brokerage companies used to first take verbal order from investors for purchase and sales of stocks, than they used to go for personal trading sessions daily at the concerned stock exchanges where they used to be members.

At that time the agents used to make deals orally with those who very interested to purchase or put on sale their stocks at the rate which they were asking or offering. Than after they used to sign the physical share transfer forms for giving the sale effect to the transaction. The original share certificate used to be one and all further endorsement used to be done thereafter in the space provided back. For giving final effect to the transaction (i.e. transfer of shares in their name) they needed to send it to the company each time if they have purchased for long term investment, otherwise they would not be eligible for interim dividends or final dividends declared by the company.

After the introduction of electronic forms of transaction and shares, all these procedures have become very handy and investor has got a big sigh of relief from the tedious paper work to be done behind each and every transactions. Now with this technology all transactions of order, buying and selling etc takes place in electronic format only. Today you just need to allocate the stocks for trade when you intend to sale or just give the delivery slip to the brokerage companies.

Stock Brokerage Companys function

The stock brokerage company takes the license of the concerned regulatory authorities and membership of stock exchanges in which it wishes to deal in. It pays required license fees or deposit for getting membership to deal in stock & securities. In turn the company asks for some fix amount of deposits from traders or investors for doing business with the company. Further for every transaction the company charge a brokerage on each transaction.

Moreover to further expand their wings the stock brokerage companies either open their own branches at various location or start giving franchises of their own terminals to those who intend to work with them. This franchise also operates more or large on this pattern only. But all, either the parent or franchise needs to operate as per the rules and regulations laid down by the regulatory authority.

Stock brokerage business has become a large scale business these days due to huge scale awareness of investments in capital market and mutual funds among the people. Rather we can say that this business is a service oriented business, which works and grows on the basis of how the company provides services to its customers. These stock brokerage companies have now a days expanded their area of work not only from brokerage, but to other areas such as investment analysis, merchant banking, depository services etc in order to make them a full fledge financial services company which can cater all the needs of investors.

Stock brokerage companies now a days have started providing market research services to the investors. They provide day to day stock tips or long term advice to the investors who are interested in their services. For providing such services they employ area specific specialists and financial experts who can evaluate and analyze the working of those stocks, activities of the companies etc. On the basis of this, they provide suggestions for the stocks to the investors. stock brokerage companies ability to provide market statistics, activity reports, and commercial information becomes very helpful in taking investment or trading decisions in highly active or volatile markets. Stock brokerage companies also provides weekly or monthly news letter in which they give their stock recommendations for investment with range bound suggestions etc on the basis of their market research or technical analysis of stocks. This newsletter helps a lot in taking decision of where to invest and when to invest, when to remain invested and when to exit from those investments. These simple looking recommendations when put into practice with due attentiveness can lead to handsome profits over a period of time. A stock brokerage company provides you various investment tools which enhance your skill in making profitable investment decisions. It equips you with the sensibility about how to get into right decision by evaluating right information at right time.

Stock brokerage companies issue their recommendations category with respect to different areas of investment. An investor can get to know all information about capital market, fixed income instruments, taxation benefits etc and other issues related with financial sector. They provide this information by conveniently categorizing for obtaining required information for right output.