What is the external broker doing?

The

external broker is an individual who invests in stock or real estate markets either on his own name or clients, but is not a member of the stock exchange. Given that only members of the stock exchange can officially make transactions, an external broker will hand over their trades based on the stock exchange to a member of the relevant stock exchange. The exception is security, which is traded directly by an apparent counter (OTC) or electronically outside the actual exchanges controlled by an external broker.

Some securities do not meet the requirements on the stock exchange due to a limited volume of trading on them, insufficient capitalization of companies and others. These securities, which are often referred to as Penny shares, are considered to be high -risk investments that agencies will not deal with. One of the primary duties outside the broker is therefore to deal with these types of securities for interesting investors.

Real estate may also include an external broker when the agency represents the buyer and sellsthe attachment of the property. In order to avoid a conflict of interest in the transaction, the agency can hire an external broker who will act on behalf of the buyer or seller. In the real estate area, an external broker may be referred to as a broker buyer when he is an independent agent who helps the customer to find a house or a commercial property at a fair price of cooperation with other real estate agencies and their extracts.

In the past, especially in the UK, they have been discredited as crooked activities outside brokerage and were referred to as "Keepers Bucket Keepers". In fact, such a broker did not buy or sell securities, but instead would basically bet on whether they would increase or reduce value on behalf of clients. This was similar to gambling bookmakers, although many buckets kept legitimate companies. Practice was also common in the commodities market focused on Chicago in the US at the beginning of the 19th century, known as "The Wheat Pit".

While the Mimal RequirementsAbout the broker can be more lax than the requirements of a broker in the agency, some government requirements must still be met to actively trade in securities. In the US, the broker has to work for a brokerage house for four months before he can pass the registered securities test, then he can work on his own. Some states in the US also require the broker to pass the uniform examination of the state law of securities agents. Other nations have similar requirements, and Canada requires brokers to be licensed by handing two parts of the Canadian securities (CSC) and the procedures manual. In Hong Kong, the broker is obliged to work in a licensed brokerage house for three years, and in the UK unders, two tests are required by Title XII, Chartered Institute for Anerities and Investment.