How to Become a Stock Broker

How to Become a Stock Broker

Learning how to become a stock broker lets you get into a fast-paced career with wild swings of fortune and tons of pressure.

Stock brokers see endless “action”, and many of them develop ulcers due to the frenetic atmosphere, long hours, and intense thrills (or mood wings) associated with the fluctuations of the stock market. Stock traders have a chance to make a fortune on the stock exchange, though.

If that sounds like an exciting career field for you, then you can’t start preparing to become a stock trader soon enough. Even grade school students need to learn the skills that later will apply to stock trading.

High School Courses for a Stock Broker

How to Become a Stock Broker

Take as many mathematics, business, and economics classes as you can in high school. A good stock broker has a firm command of math, because you’ll be dealing with prices, figures, and fractions every hour of every day of your adult life. Get a firm grounding in math, and start to think about the business world early and often. Read business publications at the school library.

Also, see if your parents will give you a little bit of money to play the stock market (in their name before 18, in your own name after 18). These sums can be small, but you might as well start to learn how investments work. What applies for 1 share of stock in a company applies for 10,000 shares of a stock, so get in for cheap and see how the stock market works from day to day.

Join an Investment Club

Investment clubs are groups of people who meet regularly to consider joint investments. These might be serious associations of high dollar investors, student investment clubs, or Internet investment club communities. The sums of money can be immense, or as small as ten dollars a month.

The idea is that you join a group which seriously considers the investment of funds in real world investment opportunities. It’s good to bounce ideas off other people, and see how other people look at the stock market. You can learn and gain experience thinking critically about the stock market.

Get a College Degree

Most stock brokers are college graduates with a degree in business, a degree in finance, or a degree in economics. Getting the college experience does several things for you.

One, you get the proper training in finance, economics, and business studies to enter a career as a stock broker. Two, you build solid credentials for a resume, which helps you attain a job at a top firm or brokerage. Three, you make valuable business contacts, because a fair percentage of your fellow students are going to rise in the world of finance. College is a chance to learn and network, so you should always be willing to learn, and try to make as many friends (and as few enemies) as possible.

Series 7 Exam – General Securities Registered Representative Exam

The National Association of Securities Dealers administers the General Securities Registered Representative Examination, more commonly known as the “Series 7 Exam”. You must pass this exam to become a registered representative of a U.S. broker-dealer. This exam takes 6 hours and includes 260 questions (250 which count). Questions cover topics like stocks, bonds, investment compnay funds, limited partnerships, and options. When passing this exam, you receive a Series 7 license.

Certain states require brokers to pass other tests, such as the Series 63 license (the Uniform Securities Agent State Law Exam) or the Series 66 License (the Uniform Combined State Law Examination), as well.

Gain Experience in the Field

Get as much on-the-job training you can get, especially the training offered by brokerage firms, which helps potential brokers prepare for their examinations. These on the job training is going to take between 4 to 6 months. When the test is passed, the broker becomes a registered representative of their sponsoring firm.

Weather the Storm as a Young Stock Broker

The work environment of a young stock broker is a competitive one. Most brokerage firms hire a lot of young college graduates, knowing many of these young brokers are going to wash out of the business. Expect long, grueling hours and a sometimes frustrating training process. You’ll eventually build a clientele, if you can weather this initial storm.

Technical Resume – Aggressive Interview

When filling out your resume, highlight your knowledge, academic studies, and experience in business, economics, and finance. When you get to the interview, be professional, but be sure to highlight your aggressive personality, your will, and your tenacity for hard work. You need to convey that you have business savvy, but also the starch to hold up to the pressures of the job.

See the Business

Take every chance to see the business and view other, established stock brokers. Visit job fairs, meet stockbrokers, and learn by seeing others do their job.

Also, be ready to have a thick skin, get used to rejection, and learn how to sell. Brokerage life comes down to making sales, but in those lean early years, you’ll have to face your fair share of rejection.

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