Whether or not you find stockbroking a fulfilling career will depend on your personality type, your skill set, and your aspirations. For those who are self-starters and want to break into the world of finance – yes, becoming a stockbroker is the right move. If you are interested in becoming a stockbroker, here is what you need to know.
Stockbrokers are licensed professionals who buy and sell stocks, as well as other securities, on behalf of their clients. Clients usually include either institutions or individuals. Stockbrokers get paid through commissions in the form of either the value of the transaction or a flat fee. Since they are responsible for procuring the best prices on stocks for their clients, stockbrokers have to be well-versed in the markets so they can offer the best guidance on the optimal time to buy and sell.
The main duties of a stockbroker include giving accurate investment advice to clients, managing client investment portfolios, evaluating financial reports accurately, keeping abreast of the latest financial news, and updating clients routinely on the status of their investment portfolios.
They are also responsible for switching strategies based on the clients’ investment goals and the market conditions, and searching for new clients by cold calling and through networking.
If you are hoping for success in your career, it can be a good move to become a stockbroker. Throughout the course of their careers, stockbrokers can become very successful. A major perk of the job as a stockbroker is that they can earn a solid base salary—plus make more money thanks to commissions and bonuses.
The average salary for a stockbroker in Australia is roughly $81,000 per year, with entry-level positions typically starting at $70,000 and more experienced stockbrokers earning up to $119,000. However, a lot of stockbrokers earn commissions based on the value of the products they sell. Stockbrokers who are breaking into the industry usually earn a base salary until they develop a strong client base, at which point the salary can gradually decrease as they earn more on commissions.
If you are a self-starter and have an interest in the financial world, finding a job as a stockbroker should not be that difficult. There are, however, basic steps that you will have to follow if you want to become a stockbroker, which include the following:
Get a bachelor’s degree. While there is no specific bachelor’s degree required, a four-year degree in economics, finance, business, or accounting are ideal. Quantitative analysis, statistics, and mathematics is a taste of the coursework that will be most beneficial to you. Most employers will require that you have a bachelor’s degree to get an entry-level job in financial services, securities, or commodities, but if you want to gain an added advantage, you could also get a Master of Business Administration (MBA).
Complete an internship. An internship is another opportunity to look out for when you are pursuing your bachelor’s degree. Usually, brokerage firms hire interns for the summer, allowing you to gain real-world knowledge of the industry. Plus, an internship gives you an invaluable opportunity to network so that, once you complete your degree, you will have an ‘in’.
Get hired by a brokerage firm or investment bank. You will need to be sponsored by a registered firm or other regulatory authority if you want to become a licensed stockbroker. Attaining sponsorship usually means being hired by a brokerage firm or an investment bank. This will help you gain a thorough understanding of regulations, financial markets, and accounting practices.
Take and pass the licensing exams. Licensing exams could vary depending on where you are located but are typically a major part of the journey to becoming a stockbroker.
For anyone who wants to become a stockbroker, it’s worth noting that a skillset is required that includes determination, communication and negotiation skills, the ability to persuade others, and competence in IT and math.
Strong decision-making skills and the ability to work effectively in high-stress environments – not to mention the ability to develop lasting professional relationships – are also a plus.
The ultimate goal for any stockbroker, especially any stockbroker starting out, is to build a client base. There are many ways that you can achieve this, but the more common ways include making cold calls to open new accounts, contacting pre-qualified prospects that were provided by a marketing firm or your own brokerage firm, contacting friends or relatives asking for referrals, and leveraging organization memberships.
