Your place on the stock exchange: pros and cons, requirements for the candidate and cost
Some novice investors are quite wary of stock brokers, not trusting the intermediaries who provide access to the markets.
It seems that if you have enough money and you can directly participate in trading on any of the exchanges, why pay a commission to the dealing center?
Indeed, nowadays almost anyone can purchase a place on the stock exchange and make transactions independently.
At the same time, you save significantly on commission, the size of which, with large turnover and a large number of transactions, can reach tens of thousands of dollars.
True, everything is simple only in words, in reality there are a lot of conditions, without which you cannot become a bidder:
Therefore, depending on which exchange you are going to trade on and in what form the opening of transactions will take place, you may be required to:
Qualified investor status - this requirement is put forward not only by MOEX, but also by all brokers with a Russian license (more information about investor qualifications - https://time-forex.com/vopros/kvalificyrovany-investor )
Minimum capital - in addition to the fact that there are requirements for the minimum volume of one transaction, there are also requirements for the minimum amount of capital, usually this amount is at least 100,000 US dollars:
Availability of a place on the exchange - on foreign exchanges you will have to buy or rent a place as a member of the exchange. The cost of purchasing a place at the moment can reach up to $3,000,000 – Wikipedia
If you wish, you can rent a place so as not to pay a huge amount at once; the rental price starts from $50,000 per month.
Recommendations – in the financial world, money is not everything; in order to become a trading participant on some exchange platforms, you will also be required to have recommendations from two current members.
We can say that if you want to become an independent bidder, there are no impossible conditions. Yes, it is difficult, expensive and not always profitable, and you will most likely need to contact a lawyer to complete the documents, but the task is completely solvable.
The main thing is to clearly understand why you need this, if in order to make money on stock exchange transactions, then the overhead costs can be much higher than the commission of dealing centers , and sometimes it will take more than one month to complete the documents.
Also, in my opinion, trading through a stock broker is much more comfortable than trading independently. Brokers provide the opportunity to trade a large number of assets of various types - currencies, commodities, securities, indices, cryptocurrencies.
In the case of independent trading of similar assets, you will need to purchase space on several exchange platforms.
In addition, there is now an excellent solution that allows you to eliminate broker intervention in the process of transmitting orders to open transactions - ECN accounts - https://time-forex.com/vsebrokery/ecn-brokery in this case, transactions are carried out in a fully automatic mode.