In this day and age, stock brokerage firms seem to be in the news daily. Not all the news is bad, so it's important for investors to keep up with US brokerage firms news and trends. If your business is planning to invest, it should research brokerage news and trends frequently, perhaps assigning the task of research and reporting to the financial staff.

You can find US brokerage firms news and trends in a number of different sources. And it's a good idea to use different sources to gather the information. As your business encounters news of particular importance to the firm, be sure to vet it from another source. Do the same with trends, especially ones that might have long-term implications for your investments or overall investment strategy. As you accumulate news and trends about brokerage firms, remember the following points:

1. Professional organizations representing US brokerage companies post news articles.

2. Business sources carry key trends affecting stock broker firms.

3. Many US brokerage houses disseminate company and general news.

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Access US stock broker agency websites

There are several organizations and agencies related to brokerage and brokerage firms. All collect and publish industry news, often with editorial comment. Your business should use one of these agencies as your first news source. Focus on topics of interest to the firm or that impact investment plans.

I recommend: Make the Financial Industry Regulatory Authority website your company's first source of US brokerage and financial news and trends. Review the news releases and other information your team finds there. Also subscribe to Hoovers industry news service. It collects dozens of related articles each week.

Check business publications for news of stock broker firms

General business publications and websites as well as those focused on stock investments carry articles on news and trends. Because of the high interest in brokerage from the general public, there are usually several 'stories' each week. Add the information from these features to that collected from brokerage organization sources.

I recommend: Check CNET for news and trends in the brokerage world. You'll also find an array of other financial news. Customize your firm's account on News Watch, a service of News Ware that will stream news on selected topics directly to your team.

Study the news from a stock brokerage house

All the major US brokerage firms post news articles on their websites and send print information on news and trends in the mail. Articles contain general brokerage news and trends and topics specific to the brokerage firm itself. Pinpoint specifics on the topics your company has been following to get a crystal clear picture of US brokerage firms news and trends.

I recommend: Read the articles and view the webcasts at LPL Financial. They cover a number of US stock brokerage topics. Check Charles Schwab for its market perspective on economic and investment news. Commentaries will give a general summary with a company view. Many brokerage firms have similar news features at their websites.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  Economic news and information on trends (especially) are often open to interpretation. Encourage your business to develop a relationship with a US stock broker so you can 'bounce ideas off' him or her.

If you want to invest actively, you’ll need a brokerage firm. A brokerage firm is a group of stock brokers who buy and sell your shares on the open market (hint: buy low, sell high). The services of a stock broker, a trained, licensed professional at a brokerage firm, are necessary to buy or sell in your name.

What, you say? Sounds like a monopoly? Not really. Lots of brokerage firms compete for your business, and orderly trading among regulated, professional brokerage firms, including online brokerage firms, helps keep utter chaos and fraud at bay, if not completely out of the picture. Hiring a brokerage firm is not hard, but it helps to decide exactly what kind of investor you intend to be.

In this guide to brokerage firms, you’ll learn:

1. Deciding among traditional brokerage firms.
2. Using a mutual fund company as your brokerage firm.
3. Selecting your bank as a stock broker.
4. Bypassing a stock broker for discount online brokerage firms.

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Go the traditional route for selecting a brokerage firm

Like your banks big and gray? Or just getting started in investing? It can be reassuring to work with a brokerage firm with a well-known name with a reputation and institutional experience backing it up.

I recommend: Some of the largest and oldest of the traditional brokerage firms are Merrill Lynch, Morgan Stanley, Smith Barney, and JP Morgan.

Mutual fund providers may offer the services of a brokerage firm

If your expectation of a stock broker is to execute trades and perhaps fork over some research from time to time. Say no more. Log on to your mutual fund provider's website and click on 'brokerage,' or call them up and ask for information on trading. They'll be thrilled to help, and cheaper in general than a personal stock broker.

I recommend: Among the bigger mutual funds companies that manage stock trades like brokerage firms, consider Fidelity, Vanguard, and Schwab.

Find a stock broker at your own bank

This wasn't true only a decade ago, but now most 'neighborhood' banks are really extensions of enormous financial juggernauts. It can be easier in some ways to hire your bank as a brokerage firm, but make sure the stock broker you get is qualified before getting in big.

I recommend: Consumer banks now offering stock brokerage firm services include Citi, Bank of America, Regions, Wachovia and Washington Mutual.

Consider online brokerage firms and discount brokerage firms to save fees

If you execute trades daily or simply feel like a stock broker is going to push advice you don't want or need, well, the web is listening. A boom in online broker services means that trading fees have dropped to single digits, one more commodity linked to an up-sell, like wealth management down the line.

I recommend: Compare and contrast services at big online broker firms, including E-Trade, Scotttrade, TD Ameritrade and Sharebuilder.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  Avoid websites that offer stock trades but little information on who owns the brokerage firm or on licensing and regulation. Scams are legion.
• •  Cheap does not equal good. If you need research and advice, the fees of a financial advisor stock broker can be regained many times over in gains.
• •  'Day trading,' or buying and selling stocks with hours or days, is possible with an online broker, but not recommended. Get into day trading slowly with online brokerage firms, and use only money you can lose.

If your company has the ability and desire to research investment options, consider using US brokerage firms to complete the deal. A brokerage firm employs brokers whose primary function is to make trades of various types of investments. Unlike investment advisers, which do the research and make recommendations for investment, brokers assess your firm's investment goals and handle the trade. Your business will find that using US brokerage firms is the most expeditious way to invest.

So it's easy to understand that using US brokerage firms can be as complex or simple as your team wants it to be. Depending on the level of involvement of your financial department in investment planning, you can use full-service, discount or even online brokerage firms. As you decide how you want to use stock broker firms, keep the following points in mind:

1. Stock brokerage firms sell an array of investment products.

2. Many full-service US stock brokerage houses are well established.

3. Online and discount US brokerage firms can make investing easy and inexpensive.

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Consult with a US stock broker to learn your investment options

One basic reason for using a US stock brokerage house is to understand different investment options. That discussion will help your company decide whether to invest in stocks, bonds, mutual funds or other investment choices. Your broker will profile your company and clarify the pros and cons of different investments.

I recommend: Use the archives at Kiplinger.com to learn about US brokerage companies. Many articles include advice and recommendations on which stock brokerage firms to use for specific investments. Combine your findings with the information at the Financial Investment Regulatory Authority website. There you can check the backgrounds of US brokerage firms.

Make wise choices with the help of a big name brokerage firm

Many brokerage firms in the US have been in business for a long time and have had amazing success. For initial or large investments, it's a smart move to use one of these US brokerage houses. Many will provide a prospectus and other documentation to help your firm's decision making.

I recommend: One of the best-known US brokerages is Merrill Lynch. Their full-service offerings include thought-provoking insights on investing company money. For mutual fund information, use Morningstar. The service provides updated data on key funds and brokerage houses. Consider having your firm join Morningstar.com for daily updates.

Use online brokerage firms for convenient trading

Comfortable with choosing the right investment? Plan to make frequent trades? If so, use a discount or online brokerage firm. Using either will save your business money and time. Because there is a huge cadre of both, the market is competitive and the fees are low. Many even offer initial free trades to get your investing started.

I recommend: Although it's not on the tip of everyone's tongue like the more-advertised brokerage houses, OptionsXpress is the top-rated online US brokerage by Barrons. Check out their free and low-cost investment services. E*Trade Financial, one of the best-known online brokers, has an introductory offer of 100 free trades when your company opens an account.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  Most major brokerage firms are both stock brokers and investment advisers. If your business's investment strategy changes, they can move your account from the brokerage to investment departments.
• •  US brokerage firms are regulated by federal and state laws. Before making a major investment, check references at the Financial Investment Regulatory Authority and North American Securities Administration websites.

US brokerage firms are often used by larger organizations because they can help determine the goals of the firm and handle any trades required to help achieve those goals. There are many different kinds of brokerage firms, including full-service, on-line or discount. Brokerage firms can handle a wide variety of investment products including stock portfolios, mutual funds and bonds. There are many well-established firms as well as discount firms, depending on your needs. As you review the various firms and their services, you will want to become familiar with some terms.

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Book value

Book value, or carrying value in accounting terms, is the value of an asset based on the original cost of the asset with depreciation, amortization or impairment costs applied against it. A company's book value is its total assets with intangible assets and liabilities subtracted. US brokerage firms track the book value of companies that are held in various portfolios they manage.

I recommend: Richard Wilson describes this term in easy to understand language.

Return on equity

Return on equity (ROE) is equal to net income (what remains after subtracting costs and expenses from total revenue) divided by total equity (assets that remain after all liabilities) expressed as a percentage. US brokerage firms track and factor in ROE when they recommend buying or holding stock in companies.

I recommend: HJ Ventures International provides a definition of return on equity.

Return on investment

Return on investment (ROI) is also known as rate of return (ROR) and refers to the ratio of money gained or lost on an investment when compared to the money that was invested. ROI is usually expressed as a percentage. US brokerage firms keep close tabs on the ROI of companies that they track in their portfolios.

I recommend: For a more precise description of ROI you can go to BusinessDictionary.com.

Mutual fund

A mutual fund is a common type of investment that is managed by US brokerage firms and consists of a pool of money that has been collected from investors. The money is then used to purchase stocks, bonds, money market instruments or other types of securities. The manager of the fund trades the pooled money on a predetermined basis.

I recommend: SEC has a definition of mutual funds.

Zero-coupon bonds

A zero-coupon bond is one that is bought at a lower price than its face value (value as printed on the instrument). The face value is then repaid at the time of maturity. Examples of this type of bond, sometimes recommended by US brokerage firms, include US Treasury bills and US Savings bonds.

I recommend: Investopedia has a definition of zero-coupon bonds.

Municipal bond

A municipal bond is issued by a city or other type of local government. It is a type of formal contract for repayment of borrowed money with interest paid at certain intervals. Municipal bonds are issued as a debt obligation that requires the issuer to either pay interest or repay the principal at a later date when it matures to the holder of the bond. US brokerage firms often recommend municipal bonds as part of an investment portfolio.

I recommend: The Securities Industry and Financial Markets Association has a more complete overview of this type of investment.