How to become a broker and how much could you make

Questions about how to become a broker seem to be increasingly frequent among users approaching the world of trading. Although this trend was much more popular at the turn of the 80s and 90s than it is today, there are still those who dream of becoming a professional in the sector.

Although times have changed for the better and there is much more information on the matter, today it is still difficult to understand what the broker does. And, above all, how does he make so much money?

The path to becoming a broker is certainly not easy. It is, in fact, a tortuous journey, made up of constant updating and continuous practice, reducing the margin of error to a minimum.

To start a prestigious and profitable career, it is important to follow the right path. Here, then, is what you need to do to become a financial broker and how much the average salary is.

Who is a broker and what does he do

A broker, better known as a intermediary, is someone who sells or buys financial assets on behalf of other people. If in the early days of this profession, the intermediary had to be physically located in the relevant banking institution, today this is no longer the case.

There are, in fact, numerous platforms that allow you to carry out this job also online, thus giving greater importance to the classification of the financial broker as a freelance professional.

His duties consist not only of knowing how to use the tools that the profession provides but also of monitoring the progress of the portfolio of his client (or clients) and calibrating every potential risk that is run.

Your earnings derive from the outcome of investment transactions. The higher the income that the investment will generate for the client, the higher the commission that the broker will be able to receive.

There are different variations of this profession. In addition to changing the learning path to follow, the type of tasks that the broker will carry out will inevitably change. Ideally, when we talk about a financial broker, we are referring to a stockbroker, but there is often confusion among users.

• The best-known category is, in fact, that of stock brokers, who deal with the buying and selling of shares, bonds, and other stock market instruments.
• Then there are options brokers, who deal in financial instruments that do not give obligations, but rather rights.
• In the financial sector, we also find cryptocurrency brokers, recently developed thanks to the advent of Bitcoin, Ethereum, and other cryptocurrencies on the market.
• Another particularly frequent category is that of the insurance broker, who deals with finding the most advantageous insurance policies on behalf of their customers. It is therefore not a financial intermediary.

Each of these variants involves not only different studies but also equally different earnings.

How much does a broker earn: the average salary

The earnings of a broker are highly variable. They depend on numerous factors, often unrelated to the direct will of the intermediary. You must first understand which company or client the broker works for.

If his role is a subordinate one, i.e. as an employee, then his margins will necessarily be reduced. It’s a different story when it comes to freelance work, where the client portfolio can be much broader.

In the United States the average salary of a broker is around $80 tousands per year. But obviously, everything depends on the reference company and the level of experience and success.

If the broker in question works for a particularly highly rated banking institution, then his salary can also be higher. And vice versa, if the company in question is not consolidated, or in any case does not have a solid structure.

However, it is not easy to make precise estimates, even more so if we are talking about freelance brokers (for whom the variables can be unlimited). In addition to the degree of experience, it is necessary to calculate the share portfolio and the amount of capital with which the broker on duty comes into contact. Of course, the salary changes if the broker works with small portfolios since the commissions will also be lower.

A senior figure and a junior worker will not have the same salary, as in any other job. Regardless, if the investment yields positive returns, the resulting commissions can be quite lucrative, surpassing considerations of contract, training, and experience levels.

How to become a broker? Stockbroker requirements and training

Anyone knows how to become a dentist, firefighter, or chef, but few know how you can work as a broker. For starters, you must have a basis of economic studies and above all an in-depth knowledge of financial markets.

What to study to become a broker

To become a broker you need to follow a very specific academic and training path.

The main advice is to obtain a degree in Economics or similar disciplines. Even studies such as Mathematics, Law and Political Science can be preparatory, as long as they are linked to a Master in Business Administration or in any case to academic in-depth studies on financial analysis.

In addition to knowledge of the world of finance, IT skills are also necessary, since all actions are now carried out using digital platforms. Among the soft skills of this professional figure, we must include problem-solving, to better manage the stock portfolio of its clients.

In the past many people entered this world without having graduated, but only thanks to their previous experience. Currently becoming a financial broker in this way is not impossible, but certainly very complex.

3 important factors for the figure of the broker

In any case, in addition to the academic training and qualification required, the key element for a broker is experience. Knowing how to navigate the various online platforms and use the financial tools provided for professionals is an equally important step.

It is therefore not a profession in which one can think of earning easily. While it may be true that earnings are generally very good, there are many skills required and, above all, several responsibilities to honor.

Despite these critical issues - present, among other things, in every profession - that of a broker still remains a fascinating and stimulating profession today. As the world of finance is constantly evolving, you will have to stay up to date.

Original article published on Money.it Italy 2024-07-11 16:45:19. Original title: Come diventare broker e quanto si guadagna