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Discount Brokerage Firm
(redirected from Discount Brokerages)

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Discount Brokerage Firm
A brokerage firm that provides transaction services predominantly or exclusively. That is, a discount broker provides clients with little or no research or investment advice; rather, it specializes in completing the transactions for which clients ask. Discount brokers usually rely on computer programs to find matching offers or bids. They charge lower commissions than other brokers and rely on a high volume of orders for a profit. See also: Deep Discount Brokerage Firm.

discount brokerage firm
A brokerage firm that discounts commissions for individuals to trade securities. Most discount brokerage firms offer limited advice but reduce their fees by 50% or more compared with full-service brokerage firms. Compare full-service brokerage firm. See also May Day.

Discount brokerage firm. Discount brokerage firms charge lower commissions than full-service brokerage firms when they execute investors' buy and sell orders but may provide fewer services to their clients.

For example, they may not offer investment advice or maintain independent research departments.

Because of the information and online account access on most brokerage websites, differences between full-service and discount firms are less apparent to the average investor.



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Other findings of the study include: -- 8% of Americans maintain accounts with both full service and discount brokerages -- 5% intend to start a broker relationship in the next six months When asked if they intend to continue their existing relationships, 80% of full service brokerage clients indicated that they would, while only 70% of discount brokerage clients planned to continue a relationship with their brokerage firm.
While web-based investing has seen relatively little growth over the past two years, the financial portfolios brought to brokerages by laterally-moving investors are on the rise, as middle-aged investors (35-54) and seniors (55+) shift their increasingly substantial portfolios from traditional full-service and discount brokerage firms to online-only discount brokerages.
Worden is a veteran executive who helped launch Royal Bank Action Direct, one of Canada's premier discount brokerages.
 
 
 
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