Broker
A typical broker accepts and carries out orders to buy and sell investments. It also may make recommendations to buy, sell or hold a specific investment, and/or make recommendations of investment strategies (including account recommendations), and may agree to periodically monitor investments in some accounts. Brokers typically provide investment services on a transactional basis, in which you pay a broker a fee called a commission or markup every time you buy or sell an investment. You may pay other fees and costs related to servicing your account and the investments that you buy, sell or hold.
Concept at a glance
Definition and explanation
A typical broker accepts and carries out orders to buy and sell investments. It also may make recommendations to buy, sell or hold a specific investment, and/or make recommendations of investment strategies (including account recommendations), and may agree to periodically monitor investments in some accounts. Brokers typically provide investment services on a transactional basis, in which you pay a broker a fee called a commission or markup every time you buy or sell an investment. You may pay other fees and costs related to servicing your account and the investments that you buy, sell or hold. [1]
Brokers are required to act in your best interest when making a recommendation and not put their interest ahead of yours. At the same time, the way brokers make money creates some conflicts with your interests. You should understand and ask a broker about these conflicts because they can affect the services and recommendations they provide. Conducting a thorough inquiry into a broker’s services, fee arrangements, and investment offerings will help you select a broker capable of serving your investment objectives. [1]
The services your broker provides and what fees you pay may be negotiable, but will ultimately depend on your account agreement with your broker. Make sure you read and understand this agreement, as well as the broker’s relationship summary and, for brokers that offer recommendations, Regulation Best Interest disclosures . [1]
Brokers generally must register with the Securities and Exchange Commission and become members of Financial Industry Regulatory Authority (FINRA) . Investor.gov has a free and simple search tool that allows you to find out if your investment professional is licensed and registered, and if the firm or person (registered representative) has had run-ins with regulators or received complaints from investors. Always check out both the person as well as the firm. [1]
If you wish to file a complaint regarding the conduct of your broker, please check out our Investor Bulletin: Investor Complaints . [1]
Source-supported connections
Frequently asked questions
What does Broker mean in the cited reference?
A typical broker accepts and carries out orders to buy and sell investments. It also may make recommendations to buy, sell or hold a specific investment, and/or make recommendations of investment strategies (including account recommendations), and may agree to periodically monitor investments in some accounts. Brokers typically provide investment services on a transactional basis, in which you pay a broker a fee called a commission or markup every time you buy or sell an investment. You may pay other fees and costs related to servicing your account and the investments that you buy, sell or hold. [1]
Broker connection map
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Links retain their source-specific meaning. Award-time affiliations and links to related reading are not claims about current appointments or economic causation.
Sources and review dates
Reviewed 23 October 2026. Historical dates and award-time affiliations retain their original context. A review date is not an event date. Background sources are identified separately from official records.