Stock Brokers are the middle man who performs the transaction of buying and selling to increase their daily incomes.
But how much do Stock Brokers make?
Who Is A Stock Broker?
Before we someone how much does a stockbroker makes let’s talk about what a stockbroker is.
A stockbroker is someone who performs the transaction of buying and selling for a client and gets paid directly from the client or through a commission that is negotiated upfront along with other deals closed for his employer. The first is an independent stockbroker and the latter is a dependent stockbroker
Today, stockbrokers are known as “Advisors” or ‘Financial Advisors’. Stock trades now occur digitally and what stockbrokers do today, is to advise clients about their paperwork and help them make investments and sales for a commission.
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How Do Stock Brokers Make Money?
They make money through commission. The stockbroker earns a commission based on a percentage of the gross value of a transaction that is carried out. The most intriguing part is that commissions vary by the company they work with. The commission of each stock is based on the price at which each company sells its product.
Stockbrokers make money indirectly to themselves, through the commission they charge those they trade for or firms who employ them to trade in their money.
A broker charges a commission of about 1% of the value exchanged. The industry standard is 1% but many individuals don’t realize that they are charged a commission to trade, so it is assumed that brokers charge their clients 1% or more.
How Much Do Stock Brokers Make?
According to the Investment Company Institute, a stockbroker makes a minimum of about $100,000 to $150,000 per annual. However, that amount is based on how often they trade stock in that year.
To some, it may seem to be easy to make money, but being a stockbroker is quite a stressful job. People loop often call brokers for questions and there are thousands of dollars at risk every time they perform transactions.
This day, Stockbrokers are known as “advisors” and they work from home using their PC unlike the former believe that they only sit in the office, they are usually on call 24/7 for 365 days. Since the transaction is 24/7, there is always someone calling in to ask a question or to make a trade.
Most of their incomes come from the commission they get from clients they trade for not their salaries.
See related https://www.prospects.ac.uk/job-profiles/stockbroker
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Do Stock Brokers Make Good Money?
The answer is Yes… but it may not be as we think. An average stockbroker makes around $100k to $150 annually if he is highly motivated and desires to put in much effort.
It’s a job that requires your time and effort to get it right and offers a good income in return.
If a stockbroker can be awake at midnight to respond to calls, then the money should be worth their time and effort. The average stockbrokers make $100-$150 annually while some earn higher than that.
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How To Become A Stockbroker
If your desire next is to earn a living in a brokerage world, then you should be ready to put more effort into learning the basics of financial markets and accounting. Once this has been cleared, the next process is taking exams that will establish you.
The two exams you need to write are:
1. The Series 7 Exam
This exam is required for all stockbrokers, nonetheless of who they work for. It is particularly set to test your understanding of the financial markets and insurance laws, as well as how to manage client accounts.
You will be registered with the Financial Industry Regulatory Authority (FINRA) if you pass this exam. From here, you can start looking for a job as a stockbroker.
2. The Series 65 Exam
This is the exam that you need to complete if you truly desire to become a Registered Investment Advisor (RIA). Becoming an RIA enables you to handle money for other people—like a stockbroker, but with more computer work.
After passing your Series 65 exam, the next step to take is to send in applications to brokerage companies and RIA firms that are hiring.
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In Conclusion
Here we are at the end of our “How Much Do Stock Brokers Make?” article and one thing is certain and that is stockbrokers get paid in cool amounts for their services. Stockbrokers make $100k -$150k annually while some make more than that.
If you want to be successful in the industry, be ready to take light sleep and put in your time and effort.
Use the comment section to tell how this has helped you.