Welcome and congratulations on choosing a to be a part of a well diverse professional career path with a high paying Stock broker salary, that will answer how to become a Stockbroker. Brace yourselves in getting higher positions in the future and enhance your job opportunities. StockbrokerPro will help you improve your chances in achieving a successful career of becoming a Stockbroker. We review the skills and requirements needed to be in this field, your strong points will be sharpened as they will be used to entice clients and your weak points will need to be improved.
What does a Stockbroker do? As a Stockbroker, you are responsible for helping clients in making decisions on how to invest their assets which involves large sums of money. In your business consultations, you will discuss with your client the inherent risks of buying the securities and the potential profit in the future. Using your mathematical and accounting prowess you will be analyzing future progress in the industry you will buy securities from. Let us provide you with our step by step how to be a Stockbroker.
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Table of Contents
- 1 What Stockbroker Career is for you?
- 2 Education Requirements to Becoming a Stockbroker
- 3 How to be a Successful Stockbroker
What Stockbroker Career is for you?
A full service Stockbroker is traditional kind of broker, who work for a firm and had a comprehensive training provided by the firm. This type of broker is normally given a fixed salary and an office space of their own. After training, brokers are required to sell proprietary products. This could also involve commission once the quota is reached.
- Online Stockbroker – The newest and cheapest form to become a Stockbroker. You will be given charts or business information that the broker needs to do online. Broad knowledge about the product is needed to give advice on about the investment.
- Bank Broker – An in-house broker consultant. This started as a reward to bank employees for bringing an outside of the bank clientele. The rate is lower than the full-service brokers. The logic is the bank brokers have already access to the bank clients. The clientele relies on low-risk businesses and fixed annuities.
- Discount Broker – Deals with informal clients and are often walk-in clients and provides you with a discount for doing your own research. This is a medium earning broker type. This is for those who wanted to try as a broker but does not want the stressful environment of a full-time broker.
Education Requirements to Becoming a Stockbroker
The Stockbroker industry is a fast evolving business sector and gives many career growth opportunities and the average broker salary is increasing. Becoming a Stockbroker you will be involved in determining the future prospect of an investment and needs to be cautious with the advice you are giving your clientele. Basically, to get a better chance of promotion and be a successful Stockbroker, there are some Stock broker requirements you need to meet.
Initially, there is no need to have a degree to become a Stockbroker, this is the most common question people have when they are looking to answer “how do I become a Stockbroker?” However financial expertise is needed in giving a fruitful advice, today at least a Bachelor’s degree in a relevant subject like Finance, Accounting, Mathematics, Business, Economics or Statistics.
Training is also a must to ascertain your learnings about different terms and selling techniques about security analysis. In taking any degree listed above you will have a background in business terms needed in your analyzing stocks trend. In the everyday business consultation with clients, finance terms are discussed and may need explanation.
In the US, Stockbroker licensing is implemented to ensure flexibility and also a guarantee to clients that the investment made had been well examined and the risks will be worth taking. There are also a lot of financial terms that needs proper training. For example, what is a stock option? This would be learned in business schools and licensing is used to gauge the Stockbroker expertise on the matter. Technically licensing varies from state to state, but the most common is that a Stockbroker needs to pass both Series 7 exam and the Series 63 examination, exams are important and will help excel your career as a licensed broker faster.
Average Stock Broker Salary
Becoming a Stockbroker has its many perks, once being a luxurious salary. A survey conducted by the Bureau of Labour Statistics in 2011 revealed the average Stockbroker salary is around $98,810, which works out to be roughly $50 an hour, which is way above the average pay rate per hour in the US. The salary of a Stockbroker ranged from $41,940 to $132,040 stabilizing the median salary at $72,060, ultimately the salary depends on the size of the firm and the location, for example, a Stockbroker in Wall Street would earn much higher salary compared to a Stockbroker in Arizona, so location is a big factor.
Stockbroker Education Requirements Series 7 and 63 Exams
Education is not a major issue before when looking to become a Stockbroker. As long as you have a background in Business or Finance that will do, we have written an in-depth guide on the Stock broker education requirements, if you do decide to go university and get a degree. As the industry expanded, the qualifications to be technically called a Stockbroker have also increased. To be called a Stockbroker, you need to have at least a degree in Finance, Accounting, Mathematics or Economics and pass the Licensing exam. In the US, the requirement varies from state to state but the common and most basic are Series 7 and Series 63 examination.
The administering body for the licensure exam is the Financial Industry Regulatory Authority (FINRA). Series 7 known as General Securities Representative is required since it will enable the licensee to freely sell financial commodities such as stocks, mutual fund, derivatives, bonds and other annuities. To have this privilege, you need to score at least 72%, for more information on the series 7 exams.
The other requirement is to pass the Series 63 exam known as The Uniform Securities Agent State Law Examination and should score at least 43 of the 60 questions. After passing these two licensing exams you are now a Stockbroker in the truest sense of the word. When applying for a job, these would be the first two questions that will be asked and will be your ticket to achieve the career route you have chosen with a high Stockbroker salary.
Do you have it in you to Become a Stockbroker?
Continuing to answer the question, “How to become a Stockbroker?” If you are interested in having a successful professional career, being a Stockbroker is the career move, an average Stockbroker salary is over $60,000. In this industry, you will experience first-hand all the lessons from your business classes.
But what are the traits needed to be an effective Stockbroker? How can you entice your clientele and make them feel that their investments are in good hands? Remember, your client is trusting their own money and normally involves a big amount. Here are some of the traits that are ideal to becoming a Stockbroker:
- Willingness to work: Becoming a Stockbroker means you are in a business along with other well-educated brokers. But how you can make a difference depending on how much you are willing to work. This may include late night works or weekend or even holidays. If you have this trait, then being a broker is the right career route for you.
- Ability to work under stress: The job will require you to make one-minute changes or decisions. If everything is going against the plan what will you do? You need to be flexible. Even under stress, you should be able to withstand it and make accurate decisions. You will be required to meet the quota set each month.
- Be Persuasive: You are asking your client to trust you with their hard earned money. Definitely, persuasion is required. How you build their confidence in you and trust will earn you the deal
- Transparency: Honesty will give you points in earning your client’s trust. You need to be clear to them about the possible risks in investing.
- Communicate effectively: Risk of failure is there all the time with buying securities. How you will explain that the possibility of doubling their capital or getting huge dividends will help you out.
- Patience: There are business terms that your clients may not understand and will require your patience to explain.
How to be a Successful Stockbroker
Becoming a reputable high earning Stockbroker and driving a convertible car is every Stockbroker’s dream. But in this raging arena where every bull is hell bent on mauling its contenders, there is no scope of playing it nice. In order to be the best, you have to climb on the shoulders of your adversaries and make your way to the top of the mountain, to earn a salary figure only your have dreamt of.
It is optimally important to keep your attention towards the market and learn as much as you can once you step into the financial sphere. One needs to be absolutely obstinate and indomitable at the same time in order to tackle all the obstructions that will come in their way. Below is an outline of what it takes to becoming a Stockbroker that is successful and earning a HUGE salary.
How is the First Year as a Junior Stockbroker
How do you become a Stockbroker, it’s simple you first start at the bottom of the career ladder. You will first become a junior Stockbroker, remember, this will be your ticket in getting higher positions in the future, so make sure you do a great job. The first step of your career route is training, wherever firm you will be in you need to start from the basic. During your training, you will be given a competitive package to enhance your knowledge in securities and provide intensive seminars to improve your ability to communicate and sell clients shares.
After the training, you have an idea of how to apply your learnt school knowledge to get a client, but this will not be easy. First, you do not have any client recommendation yet so you start from scratch. A list of pre-qualified prospects will be given by the firm and you have to get in touch with them.
This is your opportunity to prove your worth to the firm which may provide you to climb onto the corporal ladder in the future and to obtain referrals for your next prospect. This means calling your possible clients, getting an appointment and meeting them. It is time-consuming and may require you to work even on a holiday. But remember that each client that you can get will be an addition to your Stockbroker profile and may give you a bigger project in the future, and importantly referrals.
Moving Through the Ranks of a Broker
As a rule, the more deals you bring to the firm the more chances you get of being promoted. But even in the finance industry, there is a competition. To have an edge to other Stockbrokers, consider getting your MBA or Masters of Business Administration. Employers prefer MBA graduates since the education itself enhances the student’s potential for handling pressure and exposes them to the real business environment. Another tip is to work achieving another licensure aside from the basic ones.
The Series 7 and Series 63 are just the basic requirements in answering your question, “how to become a Stockbroker?”. There are other exams you can take for specialization, for example, Series 65, Series 66 and Series 3. There are a lot of options you can get and maybe add to your resume.Then, make sure to register with the Securities Commission of each state you want to work too. You just do not know what position may be offered and these simple registration will give you an edge.
Having these special examinations will add to your value as an employee. However, you need to balance it with your own performance by meeting all quota or exceeding it if possible. These including your educational background will earn you points and guarantee you a salary increase. You can then move to become a Financial Advisor once you have been a broker for a number of years. A Stockbroker salary increases as you take more exams, so always push your self to get those certificates.
What Does the Future Hold?
As a Stockbroker, you are exposed to a fast evolving business industry, where every day is a different day. In this, every evolving industry you can easily move up the corporal ladder and get a promotion depends on your performance. The fastest way to achieve this is in being a good sales representative, getting a large number of accounts and you will be presented with career advancement opportunities. Talking about job growth, according to the United States Bureau of Labor Statistics (BLS) this sector improves by 15% from the year 2010 and 2020.
The industry growth is indeed fast, and impressive not to mention that it went higher regardless of the financial crisis. Judging on the improvement on the Stockbroker job the confidence of clients or possible clientele is also increasing. This means, that you have a possibility of getting higher positions.
Also, being in a firm will give you a chance of getting competitive training package that would surely be an add-on to your Stockbroker job description and profile. Make sure to know and develop your ability to sell during this training. Why? Because being a Stockbroker means possible commissions. The more deal you close, the more incentives you get. Not to mention the satisfied clients that you have and the network of connections you may get, and who knows this could be possible bigger clients in bigger projects in the future.