What Is a Brokerage Account?
A brokerage account is an account at a broker that lets you buy and sell stocks, ETFs, bonds and funds. It is where your investments live.
How it works
You open an account online, move money in from your bank, and place orders. The broker sends your orders to the exchange and holds your shares for you. You can sell and move cash back to your bank.
Types of brokerage accounts
- Taxable account: no limits, but you pay tax on gains.
- Retirement accounts: like a Roth IRA or 401(k) in the US, with tax benefits but rules on withdrawals.
- Cash vs margin: a margin account lets you borrow to invest, which adds risk.
What to look for
Low or no trading fees, a simple app, fractional shares, and a broker regulated in your country. In the US, broker accounts are protected up to a limit if the broker itself fails, but not against market losses.
See it in real companies
Open a company to see what it sells and how it makes money.
Related terms
StockA small piece of a company you can own.
ETFOne fund that holds many stocks at once.
Fractional sharesOwning part of one share.
Market vs limit orderBuy now at any price, or only at your price.
Roth IRAA US retirement account with tax-free growth.
Margin tradingBuying stocks with borrowed money.