How do stockbrokers make money? The answers could have implications for your investments! Unless you have a huge syock of money invested in the market and you’re making your own trades, you probably use a stock broker—hopefully a discount broker. Why does makw matter? Because the incentives in place for a traditional broker might work against your own interests. A stockbroker has specific legal requirements and duties. Mmoney most important is helping individuals buy and sell financial instruments such as stocks, bonds, and derivatives. You probably pay a flat rate per transaction with your broker. Your broker has to do some work to mediate these transactions, but you’re paying them for work you could do yourself with an online discount broker. Every dollar you pay someone to do work that you could do and probably faster is a dollar that’s not earning money for you. In the olden days, unscrupulous brokers made lots of trades on behalf of their customers, churning their...