Ethical Rules For Brokers

Ethical Rules For Brokers

The stock trading industry has witnessed huge growth in the last few years with the introduction of online trading techniques that are very well in the interests of traders today. When talking about the growth in this sector, we must make a mention about the stockbrokers who play a key source or a crucial role in bringing the people and their shares together. They are the intermediaries between stock exchanges and investors.

Brokers are expected to guide the people and make them take profits from investment rather than unethically lying to them and making a confusion. Here are some rules to be followed by brokers:

  1. When doubtful, express it: a broker being experienced can still have doubts with some types of trades, at such times he should come forward to express it to the traders so that they would take their decision based on that rather than facing a loss later.
  2. Feel from their position: this is the best lesson for everyone to follow ethics. Think from others shoes so that you will be frank and helpful to them at the time of need rather than just doing the job of mediating. This will also cultivate a personal touch with the
  3. Avoid similar ideas to every client: each client /trader will have unique needs, therefore, be prepared to make customized portfolios and trade suggestion based on their preferences rather than pushing on them the same
  4. Be spontaneous: be the first one to tell them about new things that happen or anything that they need to be known for the trade. Don’t wait for them to ask for a clarification at any time, since they may not be aware of what to ask and when to do so.
  5. Be specific about the market: make the trader aware of what is happening in the market from an investor perspective. Make it clear about different assets and specific about the assets in which they have invested.
  6. Show the traders visually how the market works: it is important for the broker to use fundamental tools like a pie chart to make it clear to the traders about the market situation at the time of their investment. This will be very helpful for them to learn new things and understand the market for themselves.
  7. Explain to them about the reports: instead of just emailing to them the reports periodically make it compulsory to meet them and explain it completely, this will create confidence in them and be a positive appraisal for the broker too.

Thus, the broker should be ethical and sincere in all that he does for the investors to get the maximum advantage of taking the help of a broker.