Individuals who enjoy working with money and aren’t afraid of a challenge may choose to work as stockbrokers. Becoming a stockbroker involves training, experience and the desire to help others make money because when clients make money, the stockbroker is also making money. Here is an overview of what it takes to work as a stockbroker as well as the career outlook for stockbrokers.
How to Become a Stockbroker
An individual may be hired as a stockbroker with a high school diploma and training, but this is rare. In most cases, stockbrokers should have a bachelor’s degree, which is generally a business or finance degree. The finance degree is especially important if the candidate aspires to work for a large firm. Some securities, commodities and financial services sales agents choose to pursue a master’s degree to better qualify them for high-level jobs in the securities industry. Most stockbrokers receive extensive on-the-job training to familiarize them with which services and products their firm offers and the specific job requirements.
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In order to buy and sell stocks, bonds and other commodities for clients, stockbrokers must be licensed. Once stockbrokers begin working for an investment firm, they must register with the Financial Industry Regulatory Authority. To obtain licensure, the candidate must pass a series of tests. The stockbroker can also obtain licenses for various types of products and services the firm offers. Depending on the firm and the state’s laws, there might be different licenses required for each product they offer.
To maintain the licenses, the stockbrokers must complete continuing education courses. Certification may not be required, but some brokers volunteer to become certified to enhance their credentials. One example of a certification an agent might pursue is the Chartered Financial Analyst certification. The candidate is eligible to take this exam once he has earned a bachelor’s degree and has four years of relevant work experience.
What a Stockbroker Does
In simple terms, stockbrokers try to make money for their clients by buying financial services low and selling them high. They buy and sell stocks, bonds, and other securities. Their main goal is to make their clients money because when the clients make money, they also make money. As securities, commodities and financial services sales agents, stockbrokers must monitor the financial markets so they know the best time to make a move.
They analyze how individual securities are performing, research a company’s financials, evaluate the revenue and expenses of agreements and make recommendations for acquisitions, mergers and public offerings. A stockbroker’s job can be very stressful and may involve spending many sleepless nights monitoring potential buys and sells so they can be made at the best time to make the most money.
Stockbrokers are listed under the category of securities, commodities, or financial services sales agents by the U.S. Bureau of Labor Statistics (BLS), which predicts an employment growth of 6% for these professionals between 2016 and 2026. As the economy continues to grow, so will the demand for stockbrokers. The BLS reports that average annual wages for these professionals were $97,440 as of May 2017. Wages can be affected by the firm in which they work, years in the business, geographic location and their level of education. A great deal of a stockbroker’s income is derived by commissions, so the better the stockbroker is at his or her job, the higher the income will be.