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The following article is part of an ongoing educational series. The previous article can be found here.

Choosing a broker is one of the most important decisions you will make. Stockbrokers can be one of you best sources of advice, and most of the larger brokers have access to quality research on dozens if not hundreds of listed companies.

The vast majority of stockbroking companies are reliable and ethical - and there will be at least a few that offer exactly the service you want. But you'll need to shop around. Here's how.

Full-service, discount or internet?

The first decision to make is whether you want a full-service broker, a discount broker, or an online broker.

Full-service brokers offer the highest level of service and are usually the best choice for less experienced investors. These brokers usually distribute detailed research reports on many of the larger stocks as well as regular publications and stock updates.

Top quality broker research is generally only available to clients. The full service should include up-to-date research on specific stocks and industries, as well as recommendations on portfolio construction, monitoring your portfolio and so on.

A good broker will also contact you if something significant has changed in one of the stocks in your portfolio or if a special opportunity, such as an attractive new float, comes up.

Of course, the service you get depends on what you spend and you will pay premium brokerage for the full treatment - putting all that research together has a cost.

As you would expect, discount brokers offer a cheaper service with fewer frills - more like, say, Big W than David Jones. Some simply execute transactions for a set fee or percentage ("execution only") and won't advise you on your stocks at all, while others provide a newsletter and a few mumbles of advice, but probably nothing in detail. Again, you get what you pay for.

Internet brokers are the industry's deep discounters due to their relatively low cost structures. If you have access to independent sources of information and all you want to do is put through your trades, then using an online service may be cost-effective for you.

However, there can also be risks if you don't use this type of service properly.