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by superdadbrad on January 27th, 2010
All stocks require some sort of intermediary broker. If you use an online broker, like E*Trade or Scottrade, you eliminate the person but technically you are still using a broker.
Some online trading sites require additional assistance for purchases of high risk equities. This is additional level of security and protection for both you and the brokerage. Many high risk stocks, like penny stocks, are susceptible to fraudulent trading, or pump and dump. Some person may buy a large number of stocks in order to drive the price up and then quickly sell to realize a quick profit.
Forcing the investor to contact a broker in order to invest in these high rick stocks allows the brokerage to disclose any specific liabilities the investor may incur by participating in illegal activities.
tips on investing in penny stocks:
http://www.ehow.com/how_5289093_buy-penny-stocks.html
Some online brokerages do not normally offer penny stocks to their clients as a precaution. So, maybe in these cases, talking to a broker allows the investor access to additional securities.
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