Before you authorise another person to operate your brokerage account — the account you hold with an investment firm to keep cash and investments — ask three things: what exact powers they will have, how long the authorisation lasts, and who bears any losses. This matters most to readers who are new to investing, or who are considering letting a family member, friend or salesperson trade for them because they are busy, unwell or unsure where to start.

What you are actually signing

Authorising someone means signing a form that lets a named person — the authorised person — give instructions on your account. Two contracts govern this: the service agreement, which sets out what the firm does for you, and the dealing agreement, which governs how orders are placed. The Investor and Financial Education Council (投資者及理財教育委員會, IFEC) advises investors to read and understand these agreements before signing, to clarify obligations and liabilities — who must do what, and who is responsible when something goes wrong — and to use discretion rather than casually signing away trading decisions (IFEC, “Brokers” material, retrieved 9 October 2026).

The questions to ask before you sign

  1. Powers. Buy and sell only, or also withdrawals and transfers? Get the exact scope in writing.
  2. Duration and revocation. Does the authorisation expire, and how do you cancel it in writing? If the account terms are silent, treat that as unresolved and ask.
  3. Losses and fees. Ask who bears trading losses and any applicable fees under your agreement.
  4. Reporting. How often will the person show you trade confirmations and statements?
  5. Standing. Is the person connected to the firm, a family member, or a stranger promising returns?

These questions are this article's suggestions built on IFEC's guidance; check each answer against your own account terms.

Worked example — illustrative figures only

Assumptions (illustrative figures, not any real product's terms):

  • 1 March: you deposit HK$50,200 cash — enough for the trade plus every fee in this example.
  • Commission: 0.2% of each trade's value, minimum HK$100 per trade. The fee base is the transaction value; stamp duty and other levies are excluded for simplicity.
  • The authorised person may buy and sell only — no withdrawals.
  • Settlement is T+2, meaning cash leaves or arrives two business days after the trade date.

Steps:

  1. 2 March (trade date): they buy HK$50,000 of shares. Commission = 0.2% × HK$50,000 = HK$100, which equals the minimum, so HK$100 applies.
  2. 4 March (settlement): HK$50,000 + HK$100 = HK$50,100 leaves the account. Cash left: HK$50,200 − HK$50,100 = HK$100. Fees are fully covered because the cash was reserved in advance.
  3. 5 March: they sell for HK$48,000. Commission = 0.2% × HK$48,000 = HK$96, below the minimum, so HK$100 applies.
  4. 9 March (settlement, assuming the example uses the 2026 calendar with no relevant weekday holidays): HK$48,000 − HK$100 = HK$47,900 is received.
  5. Result: closing cash = HK$47,900 + HK$100 = HK$48,000. Loss = HK$50,200 − HK$48,000 = HK$2,200, being a HK$2,000 price fall plus HK$200 commissions.

The HK$2,200 loss sits with you, the account holder: This example assumes no compensation and no repayment by the authorised person; actual obligations and liabilities depend on the agreement and the facts.

Common mistakes

  • “The form is standard, just sign it.” Correct reading: a standard-looking form still grants real powers. IFEC's stated advice is to read the service and dealing agreements and clarify obligations and liabilities first (retrieved 9 October 2026).
  • “If they lose my money, someone will compensate me.” Correct reading: do not assume a trading loss will be compensated; clarify actual obligations and liabilities before granting authority.
  • “Authorisation is permanent and all-or-nothing.” Correct reading: check the account terms for scope, expiry and written revocation; ask the firm to confirm anything not written down.
  • “Sharing my login is the same as authorising.” Correct reading (this article's explanation): a documented authorisation names the person, the powers and the period, and leaves a record; password sharing does not replace that process; check the firm's security requirements.

Checklist before you sign

  • Read the service and dealing agreements; ask the firm to explain obligations and liabilities in writing.
  • Confirm in writing the exact powers, any expiry date, and the revocation procedure.
  • Confirm who pays commissions and fees, and keep enough cash in the account for each trade plus its fees.
  • Agree a reporting routine and read your statements regularly.
  • Keep copies of everything you sign; do not share passwords.
  • To review firms' official documents, browse, filter and sort Jolvex's brokerage listings: https://jolvex.xyz/en/brokerages

Sources and disclosure

Source: Investor and Financial Education Council (投資者及理財教育委員會), “Brokers” material, retrieved 9 October 2026; official page: https://www.ifec.org.hk/web/tc/about-ifec/about-us.page. This article is AI-generated. It is general financial education, not investment or lending advice, and does not recommend any product.