A broker is a party that act as a mediator between a buyer and a seller. A broker who also acts as a seller or as a buyer becomes a principal party to the dealer. A “brokerage firm” is a business that plays the role of a broker. A brokerage firm is a business that specializes in trading stocks.[1] A sales person working for a securities or commodity brokerage firm is popularly (but incorrectly) called a “broker.” A broker in that context is, strictly speaking, is a member who is actually executing the purchase or sales order and provides service to the client of the firm .
in short , he is a member of the stock exchange who is licensed to buy or sell shares on his own or on his client’s behalf. He charges a commission (brokerage) on the total value of the deals. Full service brokers simply execute buy or sell orders against a commission. Full service brokers offer facilities such as safekeeping clients’ shares and bonds, offering investment advice, planning clients’ portfolios of investments, managing clients’ portfolios and offering credit when a client is buying on MARGIN.
Commission brokers usually charge around 2% of the gross value of a deal; in some cases there is a minimum charge.