How shares are traded

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5. Opening an account with a broker

When you've chosen your broker, ask for an application form, or fill one in online.

In most cases, the broker will ask for a banker's reference, and you will often have to deposit money with the broker before you trade. Clients increasingly keep money in their broker's client account, rather than posting in a cheque every time they buy shares. However, some brokers do not accept cheque payments.

You may be offered the option of transferring existing shareholdings for which you have a certificate into the broker's nominee account.

The broker will issue you with a client account number and/or password which you will usually have to quote or key in when giving buy/sell orders on the phone or online.

1. The role of brokers 2. What type of broker do you want? 3. Choosing a discretionary or advisory broker 4. Choosing an execution-only broker 5. Opening an account with a broker 6. Placing buy/sell orders by telephone 7. Placing buy/sell orders online 8. Normal market size 9. The spread 10. Contract notes 11. Settlement 12. Conclusion

• First Steps in Shares
• "Investors Chronicle" Beginners' Guide to Investment