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Who is a Stockbroker? – Everything You Need to Know

A stockbroker is a financial professional who executes orders in the market on behalf of clients. It is also called a Registered Representative or Investment Advisor. Most stockbrokers work in a brokerage firm and carry out transactions for individual and institutional clients. Stockbrokers often have commissions; However, employers’ compensation methods vary. This includes both full-service brokers and discount brokers who carry out transactions; However, they do not offer individual investment advice.

Most online brokers are discount brokers, At least on their basic level of services, in which trading happens for free or for a small fee. Many online brokers now offer premium-level services with high service capabilities.

Buying or selling stocks requires access to major stock exchanges, such as the New York Stock Exchange NYSE or NASDAQ. You must be a business member or owned by a member firm to trade on these exchanges. The member firms and many of their employees are licensed as brokers or broker-dealers by the financial industry regulator, FINRA.

Although an individual investor can buy shares directly from the company that issues them, working with a stockbroker is much easier. Until recently, access to stock exchanges was costly. It was effective only for high net worth investors or large institutional investors such as pension fund managers. They used full-service brokers and could pay hundreds of dollars to trade.

Brokers in the 21st Century

However, technologies paved the way for discount brokers to provide online services with affordable, fast, and automated access to markets. More recently, apps, SoFi and Robinhood have been serving micro-investors, allowing them to buy even fractional shares. Most of the accounts in the markets today are from account holders and owned by discount brokers.

Brokers employed by discount brokerage firms can work as telephone agents, which are available to answer short questions, or as branch officers in a physical location. They can also consult with clients who subscribe to online broker premium levels. Relatively few stockbrokers work in investment banks or specialized brokerage firms.

These companies carry out extensive and specialized orders for institutional clients and individuals with high value. Another recent development of brokerage services is the introduction of robot consultants; Algorithmic management of investments carried out through a web or mobile application interface.

Licensing for Stockbroker

Stockbrokers typically require a bachelor’s degree in finance or business administration. Also, a good understanding of financial laws and regulations, accounting methods, principles of economics and currency, financial planning, and forecasting is beneficial for working in this field. Global certifications are also becoming increasingly in demand as a signal of legitimacy. Examples include references to a certified financial planner and a hired financial analyst.

For example, brokers registered in the US must have FINRA Series 7 and Series 63 or 66 licenses; a registered investment firm Must fund them. Also, brokers in the US should be members of the stock exchange where they work. In Canada, prospective stockbrokers should currently be employed by a brokerage firm. You will also have to complete the Canadian Securities Course, behavior and Practice Guide, and the 90-day Investment Advisor training program.

In Hong Kong, applicants had to work for a licensed brokerage firm. They should pass three exams from the Hong Kong Institute of Securities. Those who pass the test to obtain a license must still be approved by a financial regulator.

To become a sales representative in Singapore, you need to pass four exams, modules 1A, 5, 6, and 6A. The Banking and Finance Institute administers it. MAS and SGX have the licensing authority. Stockbrokers in the United Kingdom are strictly regulated. Brokers must obtain a qualification from a financial conduct authority. The exact capabilities depend on the specific responsibilities required of the broker and the employer.


Stockbrokers act as intermediaries between markets and the investing community. Brokers take orders from customers and try to fill them at the best price. In return, they get the name of the commission. Today, many stockbrokers have switched to financial advisors or planners as online brokerage platforms allow users to place their orders through the web or mobile app.

Traditionally, a discount broker only buys and sells on behalf of clients. In contrast, a full-service broker provides a broader range of financial services, such as research, advice, portfolio management, and more. The average salary of a stockbroker in 2020 was $60,644, with the average range ranging from $40,000 to $123,000.




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