How to become a stockbroker in the UK

This guide provides ideas on how to become a stockbroker in the UK.

Advisory/non-advisory roles

The role of a stockbroker is to either buy and sell shares on orders from their clients. For an advisory broker, the role would be to advise clients on types of shares or investments to purchase or sell based on research.

For a jonior stockbroker, it is unlikely that he/she will be thrown in the deep end right away. Their position is much more likley to be that of taking orders and communicating with market makers.

Senior UK stockbrokers deal with large corporations or individual clients' investments portfolios and try to obtain the best profit possible for them. This role is much more advisory.

Working in this business you can be also known as investment manager, private client stockbroker or wealth manager. If you really want to become a stockbroker, here are some steps that you should follow:

A good relevant degree required

•  Remember, very few (and only those with very good degrees) are selected by the stockbroking firms just after graduating school. Usually a person becomes stockbroker after activating couples of years on the market. Of course a degree in law, business, economy or accountancy may help you a lot and having an MBA or a Msc it is considered a plus. But more important is to know the “business language”, to have a view on the financial issues and stock trading.

Trainee stockbrokers

•  Sometimes, stockbroker firms take recruits who are currently doing undergraduate courses in one of the relevant subjects. These positions are for junior brokers. They are usually there to be trained and learnwhile gaining experience. This is often a great way to become a stockbroker full time. If you are at university doing an appropriate course that has an industrial placement year, look out for placements with stockbroking firms. Many young stockbrokers get in this way.

Passing FSA stockbroker exams

•  You will get a license after passing one of the exams required by FSA (Financial Services Authority), that means a qualification from Securities and Investments Institute (SII), the United Kingdom Society of Investment Professionals (UKSIP), SII Certificate in Investment Management or UKSIP Investment Management Certificate. Later, after you'll have at least three years of experience on the field, you can take some advanced certification like SII Diploma or the Chartered Financial Analyst (CFA).

•  To be approved as an “authorized stockbroker” you have to be qualified through the FSA's Registered Persons Examinations. The employer trains you a period of time, then supervises and evaluates your work. When you are able to work without supervision, the employer submits to FSA an application file that had been prior signed by you.

Some non-formal way to get knowledge

•  Join some investments clubs, where you can learn about investment opportunities, how to deal with stocks, shares and how to analyze results.

•  You can find in formation on investments clubs throughout UK in any good investment magazines such as Investor's Chronicle. To have greater responsibility, you could possibly start and manage your own club in spare time. This is a great and involving to learn about the markets and gain experience

•  Read Financial Times and other business magazines to start knowing more about who are the players on the market and how are things going.

•  You can start with a small sum to do some investments. It is said that you can become a really good stockbroker only after you've accomplished being a great investor.

•  If you haven't yet been recruited by stockbroking or investment management companies find yourself one to work for. This way you will take advantage of on-the-job training and you can prepare yourself not only theoretically, but also practically to pass the required exams in order to become a licensed stockbroker.

Importance of communication and self confidence

•  Train yourself to have a “winner” attitude, stamina, self-confidence and to be able to make quick decision and take risks on somebody else's money (an economical or political event can chance the market within hours and you have to analyze the information and act appropriately). Be a team player because you depend on the good job your team will do when making reports about the market and the companies activating on it.

Keep your perspectives and be ambitious! In this business you stay till around 40 years old, than you move on to a higher level. Don't consider the learning process finished once you took your license. If you want to be one of the best you have to be able to keep up with what's new in your activity field.