Why do stock brokers still get paid when their investment of my money loses ?

Because they can. Nice gig.

Because their main job is to make money for their firm, not you. Obviously the better the job they do for you, the more likely you are to keep using them, and to recommend other people to them, but the way they make money for their firm is through trading, doesn't matter whether you make or lose money.

Like a doctor or lawyer, they get paid for having a great deal of expertise and training, and to do the best they can. They don't get paid for results.

I know someone who has mutual funds from a company that just takes a percentage--if you make nothing you pay nothing. Maybe you should shop around if you like that arrangement better.

simple they are paid to do a job u assign (entrusting them with power to make investment for you) if u disagree.. let me quote u an example.. if u arent doing a good job then your current boss doesnt need to pay u as well rite?? no it doesnt work that way....... cheeezee

Because they are smarter.

You must be pretty smart to be able to get paid for losing other people's money. And they've been doing it for the past 100+ years!

Because you signed an agreement that says they can.

That's the way it works. Wrap accounts are the worst. Say your 'advisor' puts you in a portfolio that loses 40% and he's charging you a 2% wrap fee. He still gets 2% of whatever you have left.

Don't use these guys!!!

http://advisor.morningstar.com/articles/...

http://money.cnn.com/2006/03/05/news/new...

Brokers are not investment advisers. It is a common misconception that stock brokers can and should make good investment decisions on behalf of their clients.

The value of any broker is to brings two sides of a trade (a willing buyer and a willing seller) together and facilitate the transaction. In that spirit, a stock broker is some one licensed to facilitate transactions involving securities.

No where in the job description of a stock broker does it say that they have expertise in making investment decisions. Stock brokers get paid as long as they do their job, which is to allow their clients (you, in this case) to purchase and sell securities. They are not responsible for the results of those transitions on your total wealth.

Brokers can also act as investment advisers, but realize that there is an inherent conflict of interest. Investment advisers are paid on the value of their advice by their clients. Brokers are paid by the volume of transactions they solicit by their employers (the financial institutions).

Unfortunately, the most common financial advisers today are over glorified sales people that are compensated based on what they sell to you. This is not to say that such a professional can not effectively act as an investment adviser, it just means that their interests in the sales role is in conflict with their interests the advising role.

Unless you have such massive amount of money with a firm such that they are afraid of losing your business, I would not trust brokers with my account.