What Is a Prime Broker?

A general broker is a merchant who acts as an intermediary between the buyer and seller in securities transactions to collect commissions. Brokers have arisen as the objective needs of stock companies to develop increased securities transactions. When joint-stock companies have developed throughout the country, the types, number, and holders of securities such as stocks and bonds have continued to increase. At the same time, the number of people who buy and sell these securities has increased significantly. It is impossible to buy and sell stocks separately, and it is also necessary to fairly determine their prices in the process of many people participating in the competition. However, it is impossible for so many investors to concentrate on one place for trading. The objective requirement is that brokers with certain qualifications act as intermediaries for buyers and sellers and concentrate on securities exchanges to represent clients in securities transactions. ^[1]