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If you are good with stocks, is being a Stock brocker a good idea?

9th grader with big dreams #finance #general #business

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Subject: Career question for you
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Hristo’s Answer

Dear Edward,
If you are good with stocks and you are keen on financial markets, there are many paths in front of you. However, the two main directions are so called “buy side” and “sell side”. I’ve worked on both sides for a while, so let me share my experience.

A “sell side” means that you “sell” stocks, bonds and other securities to various entities (funds, banks, insurance companies, etc.). If you pursue that career path you can surely be a broker. In my experience, I was an investment analyst preparing equity research reports for pension funds and investment companies. It is relatively less stressful as you don’t have to worry so much about the accuracy of your predictions. Here you are providing just forecast on some stock, you are not so much accountable, and you do not have your own money on the table.

A “buy side” is when you are an equity research analyst for a fund or an investment company. In this case you can still put no personal savings in the investment ideas but you will be more accountable for your forecasts and estimations. This means it is more stressful and sometimes the working hours are far beyond 9/5. On the positive side, this is way more satisfactory because your work directly impacts the investments returns of your fund.

In either case, I will advise you to start building a career portfolio. As the industry is highly competitive, it is always good to be able to differentiate yourself. A great place to start is seekingalpha.com where you can share your stock ideas with the world. It’s free and you even earn some money if your articles get published. But the best is that it is followed by millions of investors. As you write down your investment ideas and it start to get traction, it would be easier to find your place in the industry.
On a later stage you might think about enrolling into a CFA program but it is expensive, so do that step once you are completely sure you want to pursue a career in the financial services.

All the best!

Hristo recommends the following next steps:

Create a profile and start writing on seekingalpha.com

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Rohit’s Answer

If you are good at stocks, you can always become a stockbroker, provided you read about the stock market and about the economy in general on a daily basis. These go into the very essence of buying and selling shares. You would also might have to take up some certification courses and get yourself a broking license (depending on the country-specific laws)

A stock broker essentially "sells" to a potential buyer - either asking them to invest or asking them to sell, basically making money for others and for themselves in the process. So, you need to know for sure how good a salesman are you - it requires a lot of talking and negotiation.

If you are good at stocks, you could also invest in the stock markets and make money for yourself instead for others. There are options available for one to trade round the clock and across global stock exchanges.

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Craig’s Answer

It is great that you have big dreams. I would definitely recommend that you solidify your base knowledge of financial markets as education is key. You probably have heard that many renowned investors constantly advise others to read everyday as the "secret sauce". There are many occupations to choose from and you will get to learn more as you enter college. If you are comfortable interacting with people constantly, meeting sales targets, and researching heavily, a stockbroker job may suit you. Nevertheless, you can also be an analyst that may not involve a lot of selling, so in reality there are many jobs out there related to the stock market. I suggest that you contact people in these different jobs to get a taste of what's expected. All the best in your journey.

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Gabriel’s Answer

Another angle is to look at what are the roles that involved stocks. Then find one that matches your interests and talent about "good at stocks". I listed a few below, with the criteria based on my own experience:

1. Equity analyst - Analyze individual companies based on fundamental analysis.
2. Stock broker - Know the stocks and markets and their information in a daily basis
3. Portfolio manager - Make investment decision and good at risk taking
4. Quant - Good at numbers and data, and apply techniques on the financial markets/products

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Aaron’s Answer

If it’s something you enjoy then you should definitely pursue it. You could get a finance degree and take many career paths. You could work as a stock broker or financial planner. Many large financial organizations have internal teams managing their investments. Many opportunities in the investment markets. Find something you enjoy and are good at. Opportunities will follow!

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Bruce’s Answer

Stockbroker is a good choice, but it does involve selling. You will be advising other people on what choices they should make for future investments.

Bruce recommends the following next steps:

Suggest a finance college degree with a focus on investments