ipm 3rd quiz

• stockbroker - is a regulated representative of the financial market

  who enables the buying and selling of securities on

  behalf of financial institutions, investor clients, and firms
• Stockbrokers handle transactions for both institutional and retail customers.
• The primary job of a stockbroker is to obtain buy and sell orders and execute them with a brokerage firm.
• Sometimes, broker-dealers and brokerage firms are

  also called stockbrokers.
• Types of Stockbroker

  
  

  1. full service stockbroker
  2. discount stockbroker
• A full-service stockbroker - offers a variety of financial services to clients.
• Full-service stockbrokers - also provide services like financial planning, business and personal home loans, banking services, and asset

  management.
• Clients - can either contact their personal stockbroker for trading options or use mobile and online platforms
• Discount stockbrokers - provide financial products, access

  to mutual funds, banking products, and other services.
• A discount stockbroker - offers many products and services that

  are similar to a full-service stockbroker, but with smaller

  commissions.
• Qualifications of a Stockbroker

  • Education
  • Experience
  • Exams
• order - consists of instructions to a broker or brokerage firm to purchase or sell a security on an investor's behalf.
• Orders - are typically placed over the phone or online through a trading platform, although orders may increasingly be placed through automated trading systems and algorithms. When an order is placed, it

  follows a process of order execution.
• This means that to sell, there must be a buyer willing to pay the

  selling price. To buy there must be a seller willing to sell at the

  buyer's price. Unless a buyer and seller come together at the

  same price, no transaction occurs.
• bid - price at which the buyer is willing to pay
• ask - price at which the seller is willing to sell
• market order - instructs the brokerage to complete the order at the next available price.
• limit order - instructs the brokerage to buy a security at or below a specified price.
• stop order - instructs the brokerage to sell if an asset reaches a specified price below the current price.
• buy stop order - instructs the broker to buy an asset when it reaches a specified price above the current price.
• day order - must be executed during the same trading day

  that the order is placed.
• Good-'til-canceled (GTC) - orders remain in effect until they are

  filled or canceled
• Immediate or cancel (IOC) - means that the order only remains active for a very short period of time, such as several seconds.
• An all-or-none (AON) - order specifies that the entire size of the order be filled, and partial fills will not be accepted.
• A fill-or-kill (FOK) - order must be completed immediately and completely or not at all and combines an AON order with an IOC

  order.
• BONDS - ARE A FIXED-INCOME SECURITY THAT REPRESENTS DEBT,

  USUALLY OF A CORPORATION OR GOVERNMENT.
• INVESTORS - CAN BUY BONDS AS PART OF A DIVERSIFIED PORTFOLIO. WHERE YOU BUY BONDS DEPENDS ON THE TYPE OF BOND YOU ARE PURCHASING.
• Government bonds - also known as sovereign bonds, are either placed

  up for auction with institutions that have the capacity to distribute it further to the retail investors, or sold directly to the general public.
• Corporate bonds - are those issued by private corporations listed on then stock exchange.
• Corporations - may issue bonds to investors to expand their business or sustain their operations
• You can buy bonds through different means:

  • Directly from the Bureau of Treasury’s authorized selling agents
  • Through brokers in the secondary market
  • Bond funds.