When I ask a broker to buy stock, what does the broker do?
Here are a couple of articles that can help highlight the differences between a broker and an online investment service, which seems to be part of the question that you're asking. Pay attention to the references at the end of this link. http://finance.zacks.com/online-investing-vs-personal-broker-6720.html Investopedia also highlights some of the costs and benefits of each side, broke and online investment services. http://www.investopedia.com/university/broker/ To directly answer your question, a broker may do anything from using a website to making a phone call to submitting some other form of documentation. It is unlikely that he is talking directly to someone on the trading floor, as the volume traded there is enormous. You or the broker place an order to buy the share with the stock exchange. There has to be a matching sell order by someone.  Once a match is made, you pay the money and get the share. "My answer isn't a full one, but that's because I think the answer depends on, at minimum, the country your broker is in, the type of order you place (limit, market, algo, etc.,) and the size of your order. For example, I can tell from watching live rates on regular lot limit orders I place with my UK-based broker that they hold limit orders internally until they see a crossing rate on the exchange my requested stock is trading on, then they submit a limit order to that exchange.  I only get filled from that one exchange and this happens noticeably after I see my limit price print, and my fills are always better than my limit price. Whereas with my US-based broker, I can see my regular lotsize limit order in the order book (depth of book data) prior to any fills.  I will routinely be notified of a fill before I see the limit price print.  And my fills come from any number of US exchanges (NYSE, ARCA, BATS, etc.) even for the same stock. I should point out that the ""NBBO"" rule in the US, under SEC regulation NMS, probably causes more complications in handling of market and limit orders than you're likely to find in most countries."
"If wire transfer through your bank does not work then perhaps one of the more popular money transfer services may be what you are looking for such as MoneyGram or Western Union. Now these rely on a trusted ""registered"" third party to do the money transfer so you need to make sure that you are working with a legitimate broker. Each money transfer service has a site that allows you to perform the search on registered parties around your area. There are certain fees that are sometimes applied due to the amount being transferred. All of these you will want to do some detailed research on before you make the transfer so that you do not get scammed.   I would suggest doing a lot of research and asking people that you trust to recommend a trusted broker.  I have not personally used the services, but doing a quick search brought many options with different competitive conversion rates as well as fees. Good luck." "Also, in the next sentence, what is buyers commission? Is it referring to the share holder? Or potential share holder? And why does the buyer get commission?  The buyer doesn't get a commission.  The buyer pays a commission.  So normally a buyer would say, ""I want to buy a hundred shares at $20.""  The broker would then charge the buyer a commission.  Assuming 4%, the commission would be  So the total cost to the buyer is $2080 and the seller receives $2000.  The buyer paid a commission of $80 as the buyer's commission.   In the case of an IPO, the seller often pays the commission.  So the buyer might pay $2000 for a hundred shares which have a 7% commission.  The brokering agent (or agents may share) pockets a commission of $140.  Total paid to the seller is $1860.   Some might argue that the buyer pays either way, as the seller receives money in the transaction.  That's a reasonable outlook.  A better way to say this might be that typical trades bill the buyer directly for commission while IPO purchases bill the seller.  In the typical trade, the buyer negotiates the commission with the broker.  In an IPO, the seller does (with the underwriter).   Another issue with an IPO is that there are more parties getting commission than just one.  As a general rule, you still call your broker to purchase the stock.  The broker still expects a commission.  But the IPO underwriter also expects a commission.  So the 7% commission might be split between the IPO underwriter (works for the selling company) and the broker (works for the buyer).   The broker has more work to do than normal.  They have to put in the buyer's purchase request and manage the price negotiation.  In most purchases, you just say something like ""I want to offer $20 a share"" or ""I want to purchase at the market price.""  In an IPO, they may increase the price, asking for $25 a share.  And they may do that multiple times.  Your broker has to come back to you each time and get a new authorization at the higher price.  And you still might not get the number of shares that you requested.   Beyond all this, you may still be better off buying an IPO than waiting until the next day.  Sure, you pay more commission, but you also may be buying at a lower price.  If the IPO price is $20 but the price climbs to $30, you would have been better off paying the IPO price even with the higher commission.  However, if the IPO price is $20 and the price falls to $19.20, you'd be better off buying at $19.20 after the IPO.  Even though in that case, you'd pay the 4% commission on top of the $19.20, so about $19.97.   I think that the overall point of the passage is that the IPO underwriter makes the most money by convincing you to pay as high an IPO price as possible.  And once they do that, they're out of the picture.  Your broker will still be your broker later.  So the IPO underwriter has a lot of incentive to encourage you to participate in the IPO instead of waiting until the next day.  The broker doesn't care much either way.  They want you to buy and sell something.  The IPO or something else.  They don't care much as to what.   The underwriter may overprice the stock, as that maximizes their return.  If they can convince enough people to overpay, they don't care that the stock falls the day after that.  All their marketing effort is to try to achieve that result.  They want you to believe that your $20 purchase will go up to $30 the next day.  But it might not.   These numbers may not be accurate.  Obviously the $20 stock price is made up.  But the 4% and 7% numbers may also be inaccurate.  Modern online brokers are very competitive and may charge a flat fee rather than a percentage.  The book may be giving you older numbers that were correct in 1983 (or whatever year).  The buyer's commission could also be lower than 4%, as the seller also may be charged a commission.  If each pays 2%, that's about 4% total but split between a buyer's commission and a seller's commission." I am not interested in watching stock exchange rates all day long. I just want to place it somewhere and let it grow Your intuition is spot on! To buy & hold is the sensible thing to do.  There is no need to constantly monitor the stock market. To invest successfully you only need some basic pointers. People make it look like it's more complicated than it actually is for individual investors. You might find useful some wisdom pearls I wish I had learned even earlier.  Stocks & Bonds are the best passive investment available. Stocks offer the best return, while bonds are reduce risk. The stock/bond allocation depends of your risk tolerance. Since you're as young as it gets, I would forget about bonds until later and go with a full stock portfolio. Banks are glorified money mausoleums; the interest you can get from them is rarely noticeable. Index investing is the best alternative. How so? Because 'you can't beat the market'. Nobody can; but people like to try and fail.  So instead of trying, some fund managers simply track a market index (always successfully) while others try to beat it (consistently failing). Actively managed mutual funds have higher costs for the extra work involved. Avoid them like the plague.  Look for a diversified index fund with low TER (Total Expense Ratio). These are the most important factors. Diversification will increase safety, while low costs guarantee that you get the most out of your money. Vanguard has truly good index funds, as well as Blackrock (iShares).  Since you can't simply buy equity by yourself, you need a broker to buy and sell. Luckily, there are many good online brokers in Europe. What we're looking for in a broker is safety (run background checks, ask other  wise individual investors that have taken time out of their schedules to read the small print) and that charges us with low fees. You probably can do this through the bank, but... well, it defeats its own purpose.  US citizens have their 401(k) accounts. Very neat stuff. Check your country's law to see if you can make use of something similar to reduce the tax cost of investing. Your government will want a slice of those juicy dividends. An alternative is to buy an index fund on which dividends are not distributed, but are automatically reinvested instead.  Some links for further reference:  Investment 101, and why index investment rocks: However the author is based in the US, so you might find the next link useful.  Investment for Europeans: Very useful to check specific information regarding European investing. Portfolio Ideas: You'll realise you don't actually need many equities, since the diversification is built-in the index funds.  I hope this helps! There's not much more, but it's all condensed in a handful of blogs. "I think I understand what you're trying to achieve. You just want to see how it ""feels"" to own a share, right? To go through the process of buying and holding, and eventually selling, be it at a loss or at a gain.  Frankly, my primary advice is: Just do it on paper! Just decide, for whatever reason, which stocks to buy, in what amount, subtract 1% for commissions (I'm intentionally staying on the higher side here), and keep track of the price changes daily.   Instead of doing it on mere paper, some brokers offer you a demo account where you can practice your paper trading in the same way you would use a live account. As far as I know, Interactive Brokers and Saxo Bank offer such demo accounts, go look around on their web pages.  The problem about doing it for real is that many of the better brokers, such as the two I mentioned, have relatively high minimum funding limits. You need to send a few thousand pounds to your brokerage account before you can even use it. Of course, you don't need to invest it all, but still, the cash has to be there.  Especially for some younger and inexperienced investors, this can seduce them to gambling most of their money away. Which is why I would not advise you to actually invest in this way. It will be expensive but if it's just for trying it on one share, use your local principal bank for the trade.  Hope this gets you started!" "When I have stock at my brokerage account, the title is in street name - the brokerage's name and the quantity I own is on the books of the brokerage (insured by SIPC, etc).  The brokerage loans ""my"" shares to a short seller and is happy to facilitate trades in both directions for commissions (it's a nice trick to get other parties to hold the inventory while you reap income from the churn); by selecting the account I have I don't get to choose to not loan out the shares." "As far as I know, the answer to this is generally ""no.""  The closest thing would be to identify the stock transfer company representing the company that you want to hold and buy through them. (I have held this way, but I don't know if it's available on all stocks.)  This eliminates the broker, but there's still a ""middle man"" in the transfer company. Note this section from the Stock transfer agent Wikipedia article: A public company usually only designates one company to transfer its stock. Stock transfer agents also run annual meetings as inspector of elections, proxy voting, and special meetings of shareholders. They are considered the official keeper of the corporate shareholder records. The decision to have a single transfer company is a practical one, ensuring that there is one entity responsible for recording this data - Hence even if you could buy stock ""directly"" from the company that you want to own, it would likely still get routed through the transfer company for recording." It is not your brokerage's responsibility to tell you **what** to buy, whether explicitly, or implicitly through their fee structure.  This is **not** an article about Robin Hood.  It's an argument condemning all active investing with repeated mostly-irrelevant mentions of Robin Hood as one of the hundreds of entities that makes that possible. The 'normal' series of events when trading a stock is to buy it, time passes, then you sell it. If you believe the stock will drop in price, you can reverse the order, selling shares, waiting for the price drop, then buying them back. During that time you own say, -100 shares, and are 'short' those shares.