A broker is a trusted individual or firm that charges a fee or commission for executing buy and sell orders submitted by an investor. Alternatively, they may act as an intermediary (agent) for transactions for a customer.


The primary role of a broker is providing a point of contact for investors seeking to buy or sell financial or non-financial products. A broker will be in close contact with leading players in the major financial centres and will know what trading activity they are looking to do, therefore allowing them to go and find a buy/seller for the other side of the trade.  By having a broad range of clients a broker will also help create market liquidity as they are able to bring together market participants and execute some of the larger and more bespoke transactions that trade away from an exchange. Maintaining a client’s privacy is also a must to develop trust and build a relationship.


Brokers generally receive payment for each client transaction.  The rate of compensation, called brokerage or commission, is determined according to agreements put in place before a trade.  The commission is commonly computed as either a fixed percentage of the value of the transaction or a fee linked to the volume traded.  Generally, the more active a client is with a broker the lower their fee arrangement will be.


Brokers may also provide investment advice and customers can also get access to the firm’s research or market updates and opinions. 

Brokers in some markets have to be licensed by a regulatory authority however carbon credit brokers do not have to be licensed. This has left the market susceptible to abuse in the past and pushed more of the trading towards exchanges and standardised contracts.