How to Become a Stock Broker
Woody Allen once defined a stock broker as "someone who takes all your money and invests it until it's gone". Although this clearly conveys a negative outlook, it's has an element of truth. A stock broker is an investment manager who basically works on behalf of large companies, institutions or individual clients. Their goal is to buy and sell stocks and other financial instruments in order to get the best possible return for their clients.
What Does a Stock Broker Actually Do?
Generally speaking, stock brokers work with their clients in three different ways. Some operate in a discretionary manner, managing all investments and making decisions on their clients' behalf. Other brokers serve in an advisory capacity, providing investment advice to their clients. Finally, some brokers operate on a "execution only" basis, where they act only on the explicit instructions from their clients. Of course, it's possible that a broker may work in all of these ways, depending on their client base.
As a stock broker, your daily tasks will include reviewing your clients' investment portfolios, tracking and researching various financial markets, communicating with your clients, instructing traders and marketing your services to potential clients. If you are employed by a large firm, you may specialise in certain services, industries or regional markets.
To become a stock broker, you should be able to communicate well and work easily with numbers. There are no set academic requirements, but most potential employers will be looking for a degree. Your degree can be in virtually any field, but economics, business, finance or accountancy will give you an edge over other candidates.
In addition to an understanding of how financial markets work, most positions
require a knowledge of economics and politics. World events have an effect on financial markets, and you will need to develop the ability to anticipate these effects. As competition heats up in this potentially lucrative career, some firms are beginning to look for postgraduate qualifications like an MSc or MBA. Almost all stock brokers begin work as a trainee and are promoted to higher levels as they learn and begin to perform successfully.
Registration with the Financial Services Authority (FSA) is required in order to become a fully fledged stock broker. FSA authorisation is only granted after you pass an appropriate FSA-approved exam, and your employer (while you are in training) will help to prepare you for this requirement by taking care of the details of registration. Training will likely continue throughout your career and you will be able to achieve higher levels of qualification.
Becoming a stock broker is theoretically open to anyone, but only those with a degree are likely to receive job offers. Working hours are usually long. Your advancement is based directly on your performance, but not every factor is under your control. This leads to a fairly constant State Of Stress and pressure to perform.
However, the rewards can also be very high, as your compensation is also based on performance. If you are a good communicator, are skilled with numbers, and seem to have an intuitive feel for how events can affect the markets, you may want to investigate becoming a stock broker as a viable career change option.
Other Financial Roles
To find out about other potential careers in the financial sector, read our articles in the Finance & Management Category of this site.Source: www.acareerchange.co.uk