What career is right for you?

Having trouble deciding between a career as a Wall Street trader or a stockbroker? Both involve the buying and selling of securities, but the nature of each varies widely. And these variations could make a difference in determining which career is best for you.

In this article, we will look at these differences, as well as how to become a trader or broker.

Broker or Trader: Which Career is Right for You?

What do brokers and traders do?

While both brokers and traders trade securities, brokers are also sales agents, acting on their own behalf or for a securities or brokerage firm. They are responsible for obtaining and maintaining a list of regular individual clients, also known as retail clients and / or institutional clients. Traders, on the other hand, tend to work for a large investment management company, an exchange, or a bank, and they buy and sell securities on behalf of the assets managed by that company.

Buying and selling

Brokers have direct contact with clients. They buy and sell securities based on the wishes of those customers. Some may even act as financial planners for their clients, shaping a retirement plan, dealing with portfolio diversification, and advising on insurance or real estate investments if your company offers such financial and wealth management services. They deal with stocks and bonds, as well as mutual funds, ETFs, and other retail products, as well as options for more sophisticated clients.

Traders tend to buy or sell securities based on the wishes of a portfolio manager in an investment firm. A trader can be assigned certain accounts and can be tasked with creating an investment strategy that best suits that client. Traders work in different markets (stocks, debt, derivatives, commodities and forex, among others) and can specialize in one type of investment or asset class.

A broker often spends a lot of time keeping clients informed of changes in stock prices. Additionally, brokers spend a good chunk of their days looking to expand their client bases. They do this by cold calling potential clients and showing off their background and skills, or by holding public seminars on various investment topics.


Brokers and traders alike look to analyst research to make recommendations to clients or portfolio managers to buy or sell securities. However, traders often conduct their own research and analysis as well. Despite the old stereotype of individual offers and orders screaming on a trading floor, most traders now spend their time on the phone or in front of computer screens, analyzing performance charts and polishing their trading strategies as they making a profit is often at stake. timing.

Make no mistake though, both brokers and traders tend to have high energy levels. They are generally proficient in multitasking and can cope with a fast-paced, high-pressure environment, especially between 9:30 a.m. and 4 p.m. Eastern Standard Time, when the markets are open.

Becoming a Wall Street Trader

Now that we’ve given you an overview, it’s time to take a closer look at what it takes to become a Wall Street trader. (“Wall Street” is used in the figurative sense of the financial services industry. In the digital age, traders can and do work from anywhere). Although we will focus on the business profession, the path to becoming a broker – background and education – is more or less the same.


The merchants became self-taught again. Today, a four-year college degree is a basic requirement, at least, if you want to work for a reputable financial institution or company. Most merchants have degrees in math (especially accounting), finance, banking, economics, or business. It’s not that liberal arts types can’t have successful careers as merchants – any field that encourages research and analytical thinking develops useful skills. But make no mistake, number processing, finance, and business matters are a huge part of the profession, so you should be comfortable with them.

Some applicants even go on to earn an MBA where they learn about business, analysis, microeconomics, and business planning. Others pursue a Master of Science in Finance. This route provides opportunities to learn about financial computing, advanced financial concepts, global investing, risk management, and fixed income instruments such as bonds and Treasury bills.

Whatever the specialty, you should learn all you can about the financial markets. Get into the habit of watching financial channels or reading trade publications like “The Wall Street Journal” or sites like this one.

Although some jump immediately after college, it is not uncommon for traders to have some other type of work experience before entering the field. They may work in the finance department of a corporation. That’s even more true for brokers – given the high level of customer interaction, any prior sales experience is highly valued.


The easiest way to access the trading desk of a Wall Street firm, the department where securities transactions take place, is to request it at an investment bank or brokerage. Start with an entry-level position as an assistant to a stock analyst or trader and learn as much as you can. Many financial firms offer internships, some paid, some not, and year-long training programs for college graduates, especially those on the way to obtaining their business license.

Requirements: exams and licenses

Unless you just want to trade yourself, being a trader or broker requires you to obtain a license from the Financial Industry Regulatory Authority (FINRA) to execute orders. And to get a license, you have to take some of the FINRA tests.

To be a trader, you must pass the Securities Dealer Representative Exam with a score of at least 70. This exam is colloquially known as the Series 57 exam. As of July 2021, the exam is 105 minutes long and It consists of 50 questions. Covers business activity and maintenance of books and records, business reports, and clearing and settlement.

To be a broker, you must score 72% or higher on the General Securities Representative Exam, more commonly known as the Series 7 exam. This is a 225-minute, 125-question exam, which tests the basics of investing. and investment products, as well as the rules and regulations of the Securities and Exchange Commission (SEC). Many traders also take this test.

In addition to Series 7 and Series 57, many states require a candidate to pass the Uniform Securities Dealer Law Exam, commonly known as the Series 63 exam. The Series 63 exam also assesses various aspects of the securities market. values. When a person has a FINRA license, they have the ability to buy or sell stocks and other securities.

There have been some changes for the series tests as of October 2020. A single Securities Industry Essentials Exam (SIE) replaced the overlapping parts of the 7, 57 and other series exams. Candidates will then take a smaller additional “completion” exam related to the specific field they hope to enter. The reforms will also make the test-taking process more democratic. Currently, you must be employed or “sponsored” by a FINRA registered company to perform one of the tests. Sponsorship is often part of financial firms’ training programs, with recruitment conditional on a candidate qualifying for the license, similar to the way law firms hire graduates studying for the bar exam. . The SIE removes this requirement, although you still have to be associated with a FINRA member firm to take the final exams.

On the desk and the floor

You have two years after passing an exam to register with FINRA and obtain your license. Before granting it, you will need a background check, both criminal and financial, a fingerprint card, and you will need to register with the SEC.

After you pass the exams and obtain a license, you can request to be transferred to any vacant operating table. Here, you will learn how to develop business strategies, direct trade executions, and conduct trades on behalf of the investment bank or the company’s clients. At the trading table, you also have the opportunity to study companies closely while familiarizing yourself with the markets. Gradually you will identify a niche for yourself, whether it be in futures contracts, stocks, or debt instruments.

However, before you begin assignments on a real trading floor, you must be vetted by the FBI. Because Wall Street traders deal with sensitive financial matters like government securities, the bureau checks to see if you have a criminal past. This is because leaking information can lead to damaging market speculation and economic espionage.

Race direction

There are a variety of different career paths that a stockbroker can take with some experience to his credit. Here are some options:

Financial Advisor

Advisors provide financial advice to their clients and recommend investments and financial instruments so they can achieve their goals.

Financial analyst

They analyze and study trends and data while providing advisory services to others, primarily organizations.

Investment banker

These bankers act as intermediaries between companies and investors. Businesses raise capital by selling securities, while investors buy securities for profit. Investment bankers provide advisory services to companies and help them raise the capital they need.


While the thrill of being on a trading floor or dealing with the high stakes of the financial world can be appealing, let’s not forget an important facet of this career: salary.

According to the U.S. Bureau of Labor Statistics (BLS), the median annual salary for securities, commodities and financial sales agents in July 2021 was $ 64,770. The BLS does not separate the merchants from the brokers, but rather generalizes the category as stated above. The outlook for the industry is positive: job growth between 2019 and 2029 is expected to be around 4%, as demand for financial services, investment banking and retirement planning grows.

The bottom line

People want to become a trader for various reasons. Money is key, but passion and fascination for finances and mutual fund movements are too. If you also like dealing with people, you may prefer the life of a runner. Whatever your preference, be prepared to thrive in a fast-paced workplace, because money never sleeps.


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About the author

Mark Holland

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