Functions of Sub Broker

Before we start any business we need to know what our functions as sub brokers are or what we need to do. If we want to start any kind of business in the stock market, first of all, we need to know what our responsibilities are.

The stock market is one of the best platforms to start a business. This is such a dynamic industry that never gets saturated. Something new is always active here like new regulations, strategies, policies, challenges, opportunities, etc. The stock market is such a space that gives you money, credibility, and identity, in terms of the overall opportunity.

Now, if you want to become an authorised person or open a sub-broker franchise, you must know some basic knowledge first. Actually, many of us do not know what must be the day-to-day duty of a stock market sub-broker.

What is Sub broker?

Before knowing about the functions, let's get familiar with the sub broker meaning. Sub brokers are related to stock exchanges. They work under the stock brokers. It is not possible for a stockbroker to be present physically in all the locations at the same time. So, they open some branches or sometimes they find some sub-brokers or franchise partners on the local level. They work revenue sharing with them. Someone has to clear the SEBI exam(Securities and Exchange Board of India) to become an authorized sub broker. They need to be updated with the present updates of the stock market, policies, etc.

With the stockbrokers, they make a partnership of 60-40% or 70-30%, and the major part of the share gets claimed by the sub broker. Their duty is to serve the people of that particular area. The sub-broker does not only work inside any particular geographical area. He also has an option to work across the country and get clients.

A sub broker maintains the similar activities that a broker follows. He becomes the middleman or the third man between two parties - stockbrokers and clients. However, when a stockbroker becomes the middle man between an investor or trader and the stock exchange, he plays the main role.

Functions of Sub Broker in Share Market

We need to know about the responsibilities and functions that any sub broker has to maintain on a day-to-day level.

• One of the most important tasks of a sub broker is to make sure that his clients are aware of the updated rules, regulations, and tips of new stock exchange policies in the market. If they do not know then their responsibility is to make them aware of those important things. In fact, a sub broker can build a team of those people who provide the regular services from the sub brokers side. Thus a sub broker can build a larger and long-term client base not only inside a particular area but across the country.
  
• The responsibilities of sub brokers have also come with the stockbrokers. They are helping them to make a good business. In fact, when a sub broker is raising the stock of a stockbroker, in the same way, those brokers are raising their own business. The bigger and better the quality of stockbrokers, the easier it will be for the sub brokers to establish their own business and get better quality of clients day by day.
  
• The next function is documentation. In a sub broker business model documentation is an important part. A sub broker has to provide documentation related to any subject. Whether it is related to accounts opening or other purposes. He also has to receive any kind of documents from the stockbrokers relating to contract loads, statements, account bills, etc, and deliver them to the clients. Nowadays the maximum work is done with the internet or online, but sometimes the sub brokers have to represent their stockbrokers physically and become a part of this chain.
  
• A sub broker receives many suggestions from the clients. It may be related to the market level, branding, services, margin, brokerage, etc. These suggestions make a sense that they must be shared with the stockbrokers by the sub brokers. It is like anything new that is coming in the dynamic market from the traders or clients, and the sub broker should make the stockbrokers aware of it properly.
  
• A sub broker needs to be a good assistant to both a stockbroker and the clients. He has to provide updates and important information and guidelines to the clients so that they do not make any mistakes with it. Sub brokers have to take a good role as an advisor to the clients. Many times the customers get confused with the decisions. Then a duty of a sub broker is to guide them in a proper path with a proper conception. Thus a client can be attached with the sub broker for a longer period.
  
• Sometimes a sub broker provides an education related to the stock market exchange to his clients so that they do not make any mistakes and deposit more trades in it. This might be a policy to make the clients connect with him. This can be a positive sign for a sub broker in today’s competitive market. The more trade they will deposit, the more brokerage and profit the sub broker will get.
  

Sub broker meaning is not only working under a stockbroker. He might be an excellent stock marketer as well. A sub broker has to be a good survivor to become a long-term and authentic sub broker, So, there are some steps through which they can make an establishment as an authorized sub broker:

Steps to Become a Sub Broker in Stock Market

Step no. 1: Firstly, someone needs to keep in mind choosing a reliable and trustworthy stockbroker to partner with. Working exclusively and with multiple stockbrokers are different. You have to make sure that you are making your own credibility or not.

Step no. 2:  Secondly, you have to be updated with the latest updates and news in the stock market. Make sure that the stock market's transactions are not leaving any bad impact on your growth.

Step no. 3:  Make sure you understand the financial markets. This will not be limited to you but depends on your team how far and smoothly they can carry it on.

Step no. 4:  This is one of the most important points that a sub broker must keep in mind about how easily a sub broker can acquire clients. Getting new clients is really a challenge and this is the point where sustainability comes out. For better reach, you have to apply all the media both online and offline.

There is no shortage of customers in the stock market industry. Seeing the statistics of the number of demat accounts in 2010-11 it was around 300,000. Now it has increased to 10,700,000 in 2020-21. This number is only going up. So, this is not that the demand is less. Just the platform has changed. If we count the number of sub brokers right now, we can see this number has also grown up. The revenue level also might be impressive. You can work on maintaining the following steps. It will make a sense of good yearly profit.

As we know this platform is heavily influenced by various knowledge, so you need to have a good amount of knowledge in a larger profile. You should be equipped with the latest information related to economics, politics, and environmental scenarios. These things can help you in other ways also. If someone is willing to be a franchise or even a financial advisor, it can help them.

Wrapping Up

In short, if you want to work in a sub broker business model strategically, it is still sustainable. You just have to think that how you can acquire your clients or consumers and support them. You need to provide efficient customer support, education, knowledge, decision-building advice, etc.

Inside India, the stock market is an industry where a large number of people invest money and make profits. So, in the industry of the stock market, sub brokerage is such a career-building platform that can give you a new and better identity.