Every investor worth his or her salt knows that buying the right stock in the market at the right time brings success. However, in an industry where thousands of investments are available, it’s not clear at first glance whether one should invest in a brokerage account through a stock broker.
If you’re someone who is okay with earning average profits and aren’t keen on professional investors taking your money and investing on your behalf, then this article (and brokerage) is not for you. However, if you’re looking to make better returns that you can earn if you invest and identify through promising companies, then you’ll benefit best from this.
Investing in a stock broker/brokerage
Rather than starting with the reasons why it’s beneficial to get a stock broker, it’ll be easier to look at situations wherein you don’t need a brokerage account. If you’re looking to invest, you will need to get access to the investments necessary for your financial goals. You have limited ways to achieve that goal.
Yes, it’s possible to just put all your spare money is in a bank account. Usually, checking and savings account earns next to nothing in terms of interest, though there are savings accounts or certificates of deposit that provides some return. In any case, the problem with relying on bank accounts for the money you’re investing is that the rates will never come close to matching what the stock market has benefitted investors historically. Also, you’ll never find an investment offered by a bank’s traditional banking business designed to provide true stock market exposure.
A quick look at mutual funds
A worthier use of your money when investing is via mutual funds, wherein multiple investors pool together their savings into a single investment vehicle, with a manager that uses the money and invests it based on a specific objective. Mutual funds specialize in all sorts of investments, which can include stock mutual funds that focus solely or primarily on stocks.
The right stock broker can bring you the best results
Opening a brokerage account with the best stock brokerage available in the market requires a choice that’s a lot different from bank accounts, mutual funds, as well as separately managed accounts. The key reason why a brokerage can be the gateway to wealth is because you’re still the one who manages your investment portfolio when you open a brokerage account.
There’s no banking institution, a mutual fund manager, or an investment professional controlling to find the best way to invest your money. You’re responsible for making that happen, and while a good stock broker provides the tools you need to improve your chances of eventual success, your own effort is what’s vital in determining your long-term results.
Finally, it’s important not to throw away your shot because the most valuable asset you have with investment is time. Every time you wait to get started by opening an account through a good stock brokerage company and starting to invest is more time that you won’t earn from long-term returns, which can transform modest amounts of money into true wealth. By looking for a stock broker that best meets your specific personal and financial needs, you’ll be in the best position to make your financial dreams come true.