The first step in managing your own portfolio is selecting a broker so that you are able to trade positions, whether online or over the phone. The main role of the broker is to be the medium by which you buy or sell stock. Stockbrokers make money by charging various fees such as brokerage commissions, margin interest and service charges. It is very important that the brokerage you choose be registered with the Financial Industry Regulatory Authority (FINRA) and the SEC in the US, or the IIROC in Canada.
Brokerage companies can be separated into two main categories: discount and full-service. Your choice will depend on your needs and the type of investor you are, as they both have their distinct advantages and disadvantages which will be describe below.
Full Service Brokerages