82 THE WORK OF THE STOCK EXCHANGE 
quately and profitably performing many different specialized 
tasks. 
Brokers can be subdivided into several classes, the most 
important of which is perhaps the commission broker. The 
latter is usually the “floor member” of a partnership (or 
“house” ) whose orders he “executes” on the Exchange. Such 
“commission houses” 2° differ considerably in the clientele they 
serve and the type of business they do. Some have a few 
wealthy customers, while others through their branch offices 
and out-of-town correspondents handle the smaller orders of 
thousands and thousands of average investors all over the 
country. Certain houses also specialize in some group of securi- 
ties and gain a reputation in—say—railroad, or petroleum, or 
motor stocks. 
“Two-Dollar” Broker.—Then there is the “two-dollar 
broker,” who is officially attached to no one commission house, 
but who makes use of his Exchange membership to assist the 
commission houses in executing their orders, particularly in 
heavy markets when the work is too great for the regular com- 
mission broker to handle it all on the floor. The “two-dollar” 
broker is therefore a free lance whose customers are other 
brokers. His name arises from the fact that his compensation 
for purchasing or selling 100 shares of stock used to be $2 out 
of the $12.50 which the commission broker formerly charged 
his customer. Although this former commission rate has been 
changed, nevertheless the “two-dollar” broker’s old title has 
persisted.* The practical value of the “two-dollar” broker is 
that his work imparts a flexibility and a reserve power to the 
machinery of the Exchange which it would not otherwise have, 
and enables the fluctuating number of sales made from day to 
day to be handled smoothly and efficiently, whether they are 
many or few. 
© 2See Chapter XV.