(If you’re interested, but not quite sure what a stockbroker is/does in general, then first read this).
To become a qualified stockbroker, you must obtain:
- A Bachelor of Commerce (Honours) or BCom degree in Investments, Accounting or Economics.
- A stockbroking license – you must first pass the Registered Persons Exam (RPE) which is offered by the South African Institute of Financial Markets (SAIFM). There are five levels of RPE exams and they have a minimum pass rate of 80%.
- Relevant work experience in the financial markets industry through internships and/or online stock exchange trading courses.
Is stockbroking a gloomy or glamorous career?
The answer is, well, it depends. As with most other jobs, stockbroking has its own advantages and disadvantages.
One of the major benefits of being a stockbroker is the potential to make very decent money through a good base salary, commissions and bonuses. However, contrary to popular belief, not all stockbrokers are millionaires. The future prospects of a career in stockbroking are encouraging. Even with the Fourth Industrial Revolution firmly in place, the unique skills of a stockbroker will still be required in the financial industry for the foreseeable future. In addition to this, the industry is slowly transforming by opening up more opportunities for female traders which is needed in this extremely male-dominated field.
Being a stockbroker also means high levels of stress and long hours which may destroy any possibility of have a work-life balance. High performance is a work culture that is embedded and embraced in stockbroking industries.
Another gloomy aspect of stockbroking is the sales aspect of the job. Stockbrokers are required to bring in new business which may involve cold-calling people to sell investment products and services. If cold-calling is your thing, that is great but it becomes quite difficult to sell products when the general economy goes into a downturn or recession and very few people are interested in purchasing new products. These volatile and unpredictable market movements also impact your earning potential because the job is commission-driven. With less trades to execute in a recession market, a stockbroker is vulnerable to client portfolio losses and decreased commission returns.
If you select a career in stockbroking, remember that the job might not be as glamorous as it is portrayed to be on television. In any case you may also fall in love with it! Do your planning,research carefully and also consider your own personal passions, strengths and weaknesses.