How to Become a Private Stock Broker

Becoming a private stock broker can be a lucrative career  choice for those who successfully forecast stock markets. Being a broker brings a great deal of responsibility, because others are trusting you to turn their savings  into more money. The broker profession requires a keen understanding of finance and economics, as well as the ability to follow some specific steps in order to succeed in the trading business.

Things You'll Need:

• BS Degree in Finance or Economics

Step 1:

Begin in high school by taking mathematics and economics courses. Being a successful private broker requires years of practice that allow one to develop insights into how the markets operate under various conditions. Starting at an early age provides more time for these skills to develop. Join your high school's investment club, if one is available. Use pretend money noted on paper to practice different investment strategies. These activities will help develop the skills you will need as a private broker.

Step 2:

Obtain a college degree. Most private brokers obtain a degree in finance or economics. A Bachelor of Science degree is common, although staying long enough to obtain a Master's degree will make a significant difference in the amount of money you will earn in a post-graduate world. Those who wish to entertain corporate clients might also wish to obtain a secondary degree in business administration.

Step 3:

Obtain proper licensing to conduct business as a private broker. The first step is to pass the General Securities Registered Representative Exam. More commonly referred to as the Series 7 exam, this test is administered by the National Association of Securities Dealers, and is required to be employed as a broker anywhere in the United States. Many individual states will require additional credentials. To meet the criteria of these locations, you will also need to pass the Uniform Security Agents State Law Exam, also known as the Series 63 exam, and the Uniform Investment Advisor Law Exam, also know as the Series 65 exam.

Step 4:

Apply to a brokerage house to build experience and clientele. Brokerage houses often hire large numbers of recent graduates with the expectation that many of them will not last more than a year under the pressure of the job. Working for a brokerage house allows you to use name recognition to build a portfolio of clients. It also gives you real-world working experience that will help prepare you for any exams that are required to obtain additional accreditation.

Step 5:

Start a private practice. After working at a brokerage house, you will eventually reach a point where you have learned the skills that are required to operate independently. Reach out to the clients and contacts that you have made while working at other companies, inviting them to look over your new practice. Operating your own private practice allows you to continue offering the same brokerage services to clients, with the primary difference being that you will keep a full portion of the trading profits rather than being paid a commission from another brokerage house.

Tips:

Being a successful private broker largely boils down to being a good salesman. You first must sell yourself and your abilities to a client, and then sell them on the idea of the stocks in which you are interested.

References:

• All About Stock Market: Become a Stock Broker 
• American Investment Training: Become a Stock Broker: Career Information for Advisors and Brokers 

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