A brokerage account is defined as an account that allows you, the investor or trader, to invest or trade securities using an online broker or brokerage firm.
Brokerage accounts normally fall under two categories:
1. An account that is managed by a brokerage firm
2. An account that is self-managed
With a brokerage firm managed account, your assets are placed in a brokerage account and invested on your behalf by the brokerage firm.
Brokerages charge you a commission based on the services provided.
This commission can range anywhere from ten dollars to millions of dollars, depending on the size of the brokerage account.
When opening a brokerage account you are expected to make a mandatory minimum investment amount that would vary depending on the type of broker chosen.
The average amount for this minimum investment is usually somewhere around $500 to $100,000.
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