Glossary · Defined term
Brokerage account
A brokerage account is an account with a licensed broker that lets you buy and sell stocks, ETFs, and other securities.
Last updated Oct 2, 2026
What it means
A brokerage account is an account held with a licensed broker that lets an individual buy and sell securities such as stocks, ETFs, and options. It is the standard gateway to the markets: you deposit cash, the broker routes your orders to exchanges and other trading venues, and your holdings are recorded in the account. Brokers provide statements, trade confirmations, and the tax documents you need at filing time.
The two basic flavors are cash accounts, where you can only trade with money you have deposited, and margin accounts, which let you borrow from the broker to buy more securities than your cash would allow. Borrowing magnifies both gains and losses and can trigger margin calls, so margin accounts carry extra risk. Many countries also offer tax-advantaged retirement versions of brokerage accounts with special contribution and withdrawal rules.
Opening an account has become quick and inexpensive, with many brokers offering commission-free stock trades. Before choosing one, it is worth checking the basics that affect you directly: how orders are executed, what the margin interest rate is if you plan to borrow, and how customer support and account protections work.
An example
For illustration, an investor opens a brokerage account, deposits $5,000, and places a limit order to buy 50 shares of a stock at no more than $95. The broker routes the order, it fills at $94.80, and the shares appear in the account the next business day.