Becoming a trader

What are the most important qualities an individual must have in order to become a successful stock broker?

I have toyed with the idea but am still not 100% sure of what the job entails.

Any comments and suggestions will be greatly appreciated.

kindest regards.

tpb.

thepaddingtonbre said:

What are the most important qualities an individual must have in order to become a successful stock broker?

I have toyed with the idea but am still not 100% sure of what the job entails.

Any comments and suggestions will be greatly appreciated.

kindest regards.

tpb.

Click to expand...

Are you interested in becoming a stock broker (your post's body), or a trader (your post title)? They are not the same.

a broker...

thepaddingtonbre said:

What are the most important qualities an individual must have in order to become a successful stock broker?

tpb.

Click to expand...

'A stockbroker is someone who takes all your money and invests it until it's all gone.'
Woody Allen

badman said:

a broker...

Click to expand...

Did you need a new nick to answer that post then, thepaddingtonbre?

As far as I know stock-brokers have to be able to talk posh on the phone, and sound like they know a lot (actually you don't need to know much because you're just taking orders from clients and filling them on the market, how hard can that be?). Nepotism was a requirement but possibly not so much now. Probably need a natty suit for the interview. Live near the Smoke. Hope this helps.

new_trader... yeah that's one of my favs too! . Prob applies more to 'financial advisors' now.

Let's not forget the line by Robert Kiyosaki (the RIch Dad guy) -

"A broker is called that because he's broker than you." - or something close to that. :cheesy:

In all seriousness, though, a broker is a salesperson who's passed a few mandatory tests. Doesn't mean he/she know's jack about trading or the markets. Many have never put on a trade for their own account.

John,

Given your experience, you'll know brokers have what all traders constantly seek , ie the best risk/reward ratio - (virtually) zero risk/all reward. How many poor brokers do you know who can't sleep? I'll bet the ratio of rich/poor brokers is greater than rich/poor traders.

That is the choice I face, and the broker equation wins.

Grant.

Ah, but you assume that the percentage of succesful brokers is better than that of succesful traders. Maybe it is, but there are an awful lot of folks who bomb out of brokering. That's why the turnover is so fierce.

grantx said:

John,

Given your experience, you'll know brokers have what all traders constantly seek , ie the best risk/reward ratio - (virtually) zero risk/all reward. How many poor brokers do you know who can't sleep? I'll bet the ratio of rich/poor brokers is greater than rich/poor traders.

That is the choice I face, and the broker equation wins.

Grant.

Click to expand...

You appear to be trying to compare employed brokers against self employed traders - which of course is irrelevant. All employees at an Investement bank have the same risk reward - if you do your job well you get rewarded, if you do it badly, you get sacked.


CT

CT,

My comparison is irrelevant to what?

The point is the “risk”.

Grant.

How on earth can you compare the risk involved in being an EMPLOYED broker or a self employed trader. Let me explain to you - brokers are salesmen. and like any industry the truly great are very well remunerated. The average salesman in equity markets unless he has some key clients will earn a good income NOT7 figures. But then he will plod along without too much reward nor too much risk. The self employed trader risks his own capital every day. The risk is huge, the rewards are huge. You cannot compare the 2 jobs- the are merely by products of the same industry.

CT

Paddington boor

thepaddingtonbre said:

What are the most important qualities an individual must have in order to become a successful stock broker?

I have toyed with the idea but am still not 100% sure of what the job entails.

Any comments and suggestions will be greatly appreciated.

kindest regards.

tpb.

Click to expand...

You could arrange for some work experience maybe?

Hi guys,

I am a beginner to this, could you please explain to me the difference between being a stockbroker and a trader?

From what I understand, a stockbroker works for wealthy individuals who will ring them up and say ''sell this'' or ''buy that''. The stockbroker is employed by a trading house to work on behalf of its clients.

The trader might work for the trading house or investment bank itself. They will buy and sell with the bank's money to try and make the bank a profit. They might also trade on behalf of clients but the decisions on what to buy are made by the traders themselves using their own judgement.

Is this correct?

And also, how does proprietary trading and flow trading differ and how does prop/flow trading fit into stockbroking/trading?

Thanks

Dave

A broker is a go-between. He/she takes other people's orders and brings them to the market. There can be the advisory side of things that you mentioned, but their main job is to take orders and get them executed.

A trader is someone who actually does the transactions. Brokers generally take orders from customers and then pass them along to traders to get executed, at least in the classic model of things. With electronic trading the layers are being cut down and the human element taken out of it.

Traders do not necessarily take positions. In some roles they just fill orders. In other cases, though, you are correct. They risk their employers or investors money in the pursuit of profits.

Brokers are paid based on the commissions they bring in. Traders (when they are in risk-taking positions) are paid on their profits.

Hope that helps.