How To Become A Stockbroker In The UK?

If you’re a self-starter, enjoy sales, and love helping people manage their money, being a stockbroker might be your dream career. The role requires a good grasp of the financial market, investments, and other related practices, along with the relevant educational background in the stock market. However, despite the challenges the career presents, the potential of making lots of cash and the fulfilment of developing your client base makes it worth the effort for an ambitious and hardworking individual.

Learning the primary responsibilities of a stockbroker and the educational requirements is a great way to start evaluating whether this career is the right fit for you. Everybody needs to start somewhere and you can try this investing in cryptocurrency uk tutorial to see if it fits you.

What’s the Role of a Stockbroker?

Stockbrokers are licensed individuals tasked with the role of buying and selling securities and stock on behalf of their clients, either institutions or individuals. These licensed professionals are paid for their services through a commission in form of a flat fee or a percentage based on the value of a transaction. That makes stockbrokers the middlemen between the stock exchange and their clients.

Depending on the amount of control that a client wants to maintain, stockbrokers can work in different ways. For example, a portfolio/ discretionary account is where a stockbroker is free to buy and sell stock without asking for the client’s authorization. Other clients may opt for advisory account management, where the stockbroker advises the client on their best course of action and must ask for permission before buying or selling their financial assets.

How to Start a Career as a Stock Broker

As this career doesn’t necessarily require a university degree, there are several ways you can become a stockbroker. People with experience in related fields like accounting or banking can become stockbrokers thanks to their experience in the financial market. There are also university courses, apprenticeships, and graduate schemes that help people get the relevant knowledge on becoming stock brokers. However, most brokerage firms prefer to employ stockbrokers with a university degree relevant to the field.

Here’s how to become a stockbroker with the relevant educational background (a university degree):

• Get a University Degree

Being a stockbroker is a great option after studying for the appropriate university degree. Some of the degree subjects suitable for individuals considering becoming stockbrokers in the UK include economics, mathematics, finance, accounting, business studies, and management. It’s also useful to get an apprenticeship/ internship in a brokerage firm while studying these subjects to get relevant experience in the field.

To qualify to study one of these university degree subjects, you’ll need at least two A-levels with good grades. That’s why you must familiarize yourself with the entry requirements of the university you choose, as one institution might differ from the other. However, most graduate schemes often require individuals to get upper second class honors in their undergraduate subject to qualify. Getting some work experience in the field might also help your application.

• Complete an internship

As you continue pursuing your undergraduate degree, look for an internship opportunity. Fortunately, there are lots of brokerage firms in the UK that hire summer interns to work in their offices. That provides you with the opportunity to apply your knowledge in the real world and allows you to establish invaluable connections that will help you get a job and clients after graduating. The internship is also a good way to get additional job training that lots of brokerage firms offer new stockbrokers, giving you an edge over your competitors in the job market.

• Get a Job in an Investment Bank or a Brokerage Firm

You need a sponsorship from a firm registered by the Financial Industry Regulatory Authority to be a licensed stockbroker. That means being hired by a brokerage firm or an investment bank. However, most stock brokerage firms and investment banks only endorse individuals who can demonstrate their deep understanding of accounting practices, financial markets, and regulations.

• Register with the FCA

After getting all the necessary qualifications and experience, you’ll need to be registered with the FCA (Financial Conduct Authority) before you start working as a stockbroker. The Financial Conduct Authority regulates the trade of all financial assets in the UK, although it’s an independent body away from the government.

The FCA regulates all activities conducted by financial firms, helping to maintain the integrity of the financial markets in the UK while offering services to customers. The organization also sets the minimum standards, imposed product requirements, and can investigate players in the financial market.

Registering with the FCA will make you a licensed professional approved to handle activities known as “Controlled Functions” by the governing body. These activities fall under the regulations stipulated by the FCA, including stock brokering and investments. As such, all stockbrokers in the UK must comply with the rules set by the FCA.

Stock Broker Career Progression

Once you’re a licensed stockbroker with relevant experience, you might want to consider other related careers to progress within your field. For example, you might consider becoming a trader, working with large investment management companies, exchanges, and banks that sell and buy securities and stocks on behalf of their firm’s assets.