Stockbroker: Difference between revisions
ClueBot NG (talk | contribs) m Reverting possible vandalism by 97.77.222.122 to version by 87.236.70.17. False positive? Report it. Thanks, ClueBot NG. (1067227) (Bot) |
No edit summary |
||
| Line 24: | Line 24: | ||
=== United States === |
=== United States === |
||
While the term "stockbroker" is still in use, more common terms are "broker," "registered rep." or simply "rep." — the latter being abbreviations of the official [[Financial Industry Regulatory Authority]] (FINRA) designation "[[Registered Representative]]," obtained by passing the FINRA [[General Securities Representative Exam]] (also known as the "Series 7 exam") and being employed ("associated with") a registered [[broker-dealer]], also called a [[brokerage firm]], typically a FINRA "member" firm. More restrictive FINRA licenses or series exams exist for brokers or reps who do not need the full array of capabilities with the Series 7 (see [[list of securities examinations]]). Variable products such as a [[variable annuity]] contract or [[variable universal life insurance]] policy typically require the broker to also have one or another state insurance department licenses. |
While the term "stockbroker" is still in use, more common terms are "broker," "registered rep." or simply "rep." — the latter being abbreviations of the official [[Financial Industry Regulatory Authority]] (FINRA) designation "[[Registered Representative]]," obtained by passing the FINRA [[General Securities Representative Exam]] (also known as the "Series 7 exam") and being employed ("associated with") a registered [[broker-dealer]], also called a [[brokerage firm]], typically a FINRA "member" firm. More restrictive FINRA licenses or series exams exist for brokers or reps who do not need the full array of capabilities with the Series 7 (see [[list of securities examinations]]). Variable products such as a [[variable annuity]] contract or [[variable universal life insurance]] policy typically require the broker to also have one or another state insurance department licenses. |
||
==External links== |
|||
*[http://www.selectabroker.com/ List of brokerage firms by country] |
|||
== See also == |
== See also == |
||
Revision as of 20:48, 10 May 2012
 |
A stock broker is a regulated professional broker who buys and sells shares and other securities through market makers or Agency Only Firms.
Similar roles of the stock broker
Roles similar to that of a stockbroker include investment advisor, and financial advisor. A stockbroker may or may not be also an investment advisor, and vice versa.
Acting as a principal
Stockbrokers exclusively trade on their own behalf, as a principal, speculating that a share or other financial instrument will increase or decline in price. In such cases the term broker makes little sense and the individuals or firms trading in principal capacity sometimes call themselves dealers, stock traders or simply traders. There are many other types of traders within capital markets, for example trading within the foreign exchange market.
Requirements
Canada
In Canada, stock brokers are called "Licensed Representative" or "Investment Representative". To be licensed to trade on stock exchanges, a person must complete the Canadian Securities Course (CSC) and the Conduct & Practices Handbook (CPH). This equips an employee to trade all instruments except derivatives and futures. To trade derivatives and futures, a person must obtain respective licensing for these instruments.
Hong Kong
To become a representative one has to work for a licensed firm and pass 3 exams to prove one's competency. Passing a fourth exam results in obtaining a 'specialist' license. All tests can be taken with the HKSI. However, passing all tests doesn't result in automatically obtaining the license. It still needs to be approved by the financial regulatory body.
Singapore
In Singapore to become a trading respresentative, you need to pass 2 exams from Institute of Banking and Financial. The 2 exams are Module 1A and Mod 6. After you pass the exams, you need to apply for the license through MAS and SGX.
United Kingdom
In the UK, brokers are required to pass the XII (Chartered Institute for Securities & Investment) Certificate in Securities, this qualification is achieved by passing two exams: Either Unit 1: FBI Financial regulations or Unit 10 Principles of Financial Regulation for MiFID compliant retail trading, and either Unit 2: Securities, Unit 3: Derivatives or Unit 4: for both Securities and Derivatives. Passing Unit 10 or Unit 52 identifies individuals as having attained FSA Approved Person Status.
United States
While the term "stockbroker" is still in use, more common terms are "broker," "registered rep." or simply "rep." — the latter being abbreviations of the official Financial Industry Regulatory Authority (FINRA) designation "Registered Representative," obtained by passing the FINRA General Securities Representative Exam (also known as the "Series 7 exam") and being employed ("associated with") a registered broker-dealer, also called a brokerage firm, typically a FINRA "member" firm. More restrictive FINRA licenses or series exams exist for brokers or reps who do not need the full array of capabilities with the Series 7 (see list of securities examinations). Variable products such as a variable annuity contract or variable universal life insurance policy typically require the broker to also have one or another state insurance department licenses.