The stock market is essential to any country’s economy because it basically finances the different industries that need expansion. A strong stock market indicates that businesses in a certain country are good since a lot wants to invest in it. On the other hand, a crashing stock market means investors do not trust the country’s ability to generate money.
Stockbrokers offer the service of buying and selling shares and trading other securities in a stock market for someone else. Stock brokers are often confused with traders. There are differences, though, in such a way that brokers often have direct contact with their clients while traders has to answer first to a relationship manager to get to his client. Moreover, stockbrokers are also sales agents while traders are not.
There are different types of buy and sell service a stockbroker can offer to his clients. The first is the execution-only service where the stockbroker only does what the client tells him to buy and sell. Meanwhile, advisory dealing is when stockbrokers can only offer advices on the best shares to buy and sell to optimize their clients’ investments. However, it is still up to the client what he decides to do. Finally, discretionary dealing is where stockbrokers are allowed to do anything to his clients’ investments depending on his calculated decisions.
Starting a career as a stockbroker requires one to have a client base so he needs to build up his networks first for possible clients. That means, at the start, he has to make many phone calls and get into as much networking as he could so he can score a client. Aside from that, there is a connotation that stockbrokers have to be a business, finance or economics graduate. Although having knowledge in finance and economics would be a big advantage, there is no strict rule that other course graduates cannot succeed in this career.
What is important, really, is that you fully understand the financial markets which you can do by keeping yourself up to date through publications like The Wall Street Journal or watching financial news on TV. There is also the internet to always keep you posted. Aside from that, you can also take up a class on finance if you are still in school. This means you need to have a genuine interest in stock markets and not just in it for the money because it needs your full attention to understand the subject.
Furthermore, being a professional stockbroker also requires license so passing the required exam for it is necessary. Moreover, success in this business also relies on a very strong communication and negotiation skills and you don’t have to be a business graduate to have those characteristics. It is also important that you know how to work under pressure and a lot of stress and that you know how to multi-task as you will probably have to work with more than one client.