A stockbroker is licensed to solicit business and transact trades in investment securities, including common stock, preferred stock, bonds, mutual funds, options, futures and annuities. Many brokerage firms will help new brokers get licensed. They look for recruits who have a history of successful sales production at other jobs and usually prefer a college degree. Pay is a small draw against commission, and most new stockbrokers make $30,000 to $50,000 with more established brokers making $100,000 or more.
Before the Open
A good stockbroker will arrive in the office at least a half hour before the market opens. She will first make sure all trades from the previous day's work were executed and confirmations generated, and immediately work on any problems. Most firms conduct a morning squawk box meeting during which the managers of the various trading desks, syndicate manager, the various product managers and the sales manager will give their reports and recommendations for the day's business.
During the Day
The day is mostly spent on the phone with clients, pitching buying and selling opportunities or cold-calling prospective clients. A new broker building a book of clients expects to make 400 dial-outs a day and hopes to be able to make a sales pitch to at least 25 people out of that number. Occasionally, a client will visit to discuss investment opportunities and portfolio strategies with the broker.
If a trade is done, the broker must fill out a trade ticket, turn it in at the trade window where it is electronically messaged to the trading desk, and then wait for the transaction report. After receiving the report, the broker usually calls the client to inform him that the order was filled and at what price.
After the Close
Most brokers will remain in the office long after the market closes in order to cold-call prospects and clients. They will also check their day's trade tickets to make sure nothing has been overlooked. Any error or overlooked ticket can result in significant losses, and often those losses are borne by the broker.
The job of stockbroker is highly entrepreneurial. Your success depends on your own efforts. Often brokers will build their clientele by speaking at local association meetings, giving classes at a local evening schools or entertaining clients after work hours. In fact, many stockbrokers come into the office on Saturdays to meet with clients who work during the week and can meet with their brokers only on the weekends.
A stockbroker is more of a sales rep than a portfolio manager or trader. Although it helps a broker to become educated in economics, portfolio management, trading strategies and securities analysis, the firms employ people to do these things and the stockbroker is expected to sell those professional services as part of the total product offering presented to the firm's clients. Work as a stockbroker often is a good stepping stone to sales or finance oriented jobs in other industries.
- Victoria Duff - see comment section
- Bureau of Labor Statistics
Victoria Duff specializes in entrepreneurial subjects, drawing on her experience as an acclaimed start-up facilitator, venture catalyst and investor relations manager. Since 1995 she has written many articles for e-zines and was a regular columnist for "Digital Coast Reporter" and "Developments Magazine." She holds a Bachelor of Arts in public administration from the University of California at Berkeley.