Carrying Broker

Carrying brokers are brokers, or even brokerage firms, that tend to operate in the back, carrying out tasks for deals other brokers make.

They can offer a number of services, such as settlements and various custodial services. They want to focus on the administrative tasks, not so much the selling to investors. The introducing broker does that. The introducing broker seeks out investors and manages their portfolios.

You know how people will say they “know a guy”? That guy is the introducing broker.

But the introducing broker may not have time to send out the payments on these investments, track each share, and send out the statements of each action to the investors. That’s where the carrying broker comes in. The relationship between these two sides of brokers is very common...in fact, Goldman Sachs and J.P. Morgan (Chase bank) offer carrying brokerage services.

Often, carrying brokers are 24-hour, full-service groups that offer the use of the most sophisticated software and reporting tools...tools the smaller introducing brokers might not be able to afford, or be able to use to full capability. This arrangement lets people really excel at what they’re good at.

An introducing broker might be the definition of a social butterfly, the belle of every ball, everyone’s financial Prince Charming, whichever strikes your fancy. This lets the belle go to every ball, make the connections, answer questions, and educate their clients, without having to tackle the mountain of paperwork on their own. They can really be “the guy.”