What does a stock broker do?
Stock brokers sell securities to retail investors, which are most investors. Since there are so many securities, retail investors must work with a stock broker instead of trading independently. The first thing an investor does is talk to a stock broker about trade terms. The broker then passes on the information to a trader of the securities company. The stock trader places the request on an electronic network or with a broker on the floor at the exchange.
It is essential for stock brokers to seek out new clients and build a strong base of customers. They use telephone solicitation, business and social contacts, social groups, investment courses and lectures, and call lists to recruit new clients.
What kind of training does a stock broker need?
Stock brokers must have a bachelor degree. Most have a bachelor degree in accounting, business, economics, or finance. Many brokers complete internships where some are offered positions after graduation. Most firms provide rigorous training on the job for entry-level stock brokers. Stock brokers regularly attend training seminars and conferences to stay up to date with new services and products and developments in the field.
The Financial Industry Regulatory Authority (FINRA) requires all stock brokers to register as representatives of their firm. The requirements are passing the General Securities Registered Representative Examination (Series 7 Exam) and being an employee of a registered firm for a minimum of 4 months. Majority of states also require the Uniform Securities Agents State Law Examination (Series 63 or 66 Exam). To maintain their licenses, registered representatives must complete continuing education courses periodically.
What are the prospects for a career as a stock broker?
Employment of stock brokers is projected to grow much faster than average for all professions, increasing 25% from 2006 to 2016 (1). Growth will stem from more Americans investing in securities.
Job prospects are expected to be good with keen competition. The best prospects will be for stock brokers with great résumés, an excellent academic record, and strong interpersonal skills.
How much do stock brokers make?
As of August 2009, the middle 50% of stock brokers earned annual salaries between $47,342 and $58,948. The top 10% earned annual salaries of more than $63,041 (2).
A career as a stock broker is an excellent choice for people who are interested in securities. Decisiveness, being able to work as a team, independent thinking, excellent communication and interpersonal skills, analytical thinking, and mathematical skills are essential qualities. Stock brokers must have widespread knowledge of the finance field and keep up to date on the trends and conditions of the economy.