Career question, broker/analyst how long? Worth it?

[lendaddy]

Just weighing my options and looking for info.

What is involved in becoming a broker or analyst? Is higher education a requirement or is it based mainly on your test?

If I went this route I wouldn't want to be the hump cold calling business owners trying to set up structured investments, I would want to be deep in the machine. Can you specialize in being an analyst or is that another rung on the ladder?

Basically what's the skinny on getting in the game?

Thanks,

[lendaddy]

I should add that I've just entered my mid thirties. How would my age affect my potential? Good, bad or indifferent?

[Don Plumley]

Those are different jobs. An analyst is typically an MBA with heavy finance. A broker sells stuff. If you can sell, you can be a retail broker. A commercial broker sells to institutions.

[Don Plumley]

Here's more: Research Analyst

[lendaddy]

Originally Posted by Don Plumley

Those are different jobs. An analyst is typically an MBA with heavy finance. A broker sells stuff. If you can sell, you can be a retail broker. A commercial broker sells to institutions.

I admit my ignorance, I did not know that analysts held MBAs. We can go ahead and cross that off my list

So take a guy that has little higher education, is there a good way to get in the game? What are the options?

if the answer is no then the answer is no but I'm just taking stock of my interests and potential careers.

[Jim Sims]

The pay isn't all that great for retail brokers especially starting out. I seem to recall it is helpful to be a college graduate.

http://swz.salary.com/salarywizard/layouthtmls/MI/swzl_compresult_state_MI_FA06000081.html

[lendaddy]

Originally Posted by Jim Sims

The pay isn't all that great for retail brokers especially starting out. I seem to recall it is helpful to be a college graduate.

http://swz.salary.com/salarywizard/layouthtmls/MI/swzl_compresult_state_MI_FA06000081.html

Thanks, that's helpful. FWIW that's not bad money to me.

[lendaddy]

I want to be clear though, if my lack of a degree is a major issue then just tell me. I need to know the reality of the situation.

[Jim Sims]

Brokers (and the whole retail brokerage business) depend on the fact that the general investing public is ignorant of the "Efficient Market Hypothesis" (EMH). You'll spend your life on the phone (earbud ear) and in front of the computer. The work can get real interesting if you have to contact accounts about margin calls especially if the wife answers and is ignorant about what hubby has been doing. They all think they are financial geniuses and can beat/time the market and almost always get handed their ass.

[lendaddy]

Originally Posted by Jim Sims

Brokers (and the whole retail brokerage business) depend on the fact that the general investing public is ignorant of the "Efficient Market Hypothesis" (EMH). You'll spend your life on the phone (earbud ear) and in front of the computer. The work can get real interesting if you have to contact accounts about margin calls especially if the wife answers and is ignorant about what hubby has been doing. They all think they are financial geniuses and can beat/time the market and almost always get handed their ass.

lol I can only imagine. Though I will say you don't make it sound nearly as sexy as I had imagined. I would much rather be in the trenches crunching numbers and doing research than calling humps and trying to hard sell.

[jyl]

I don't know anything about retail brokers.

Institutional salespeople usually, not always, have MBAs and started in the business in their twenties. There is usually a lot of travel required, they are often away from home 50% of the time. You have to know a lot about stocks and markets and finance, or rather to appear to know a lot, and sound like you're on top of things. Also need to be a fast study, able to learn about an investment idea and pitch it to clients right away. Normal salesman skills required as well.

Analysts usually have MBAs. They may start fresh from the MBA program and start in a junior position, or in some cases they come later in life, from a background in the industry that they cover. Generally the job involves a lot of financial analysis, Excel modeling, research, digging for information, etc. Being in front of a screen 12 hours a day, etc. If you like figuring out why hops prices are rising, forecasting how much they will rise, then estimating the impact on the gross margins of BUD and SAM, then whether one is a long and the other a short, that kind of thing, then it is an interesting job. I suspect it is an acquired taste.

Analysts can be buyside, meaning they work for the money management companies, or sellside, meaning they work for the brokerages. The senior sellside analysts work very hard, travel more than half the time, and increasingly they have less job security. The junior analysts (assistants, or associates) work hard and do a lot of grunt work. The buyside analysts usually don't travel as much, but it varies. It is difficult to go directly into a buyside job, often analysts do their time on the sellside first. In general, job security in this industry is decreasing, and its not unusual for people to change jobs every few years. The hedge fund guys change jobs every year, it seems like.

Realistically, I think you'd need to go back to school to have a decent chance at getting into this business. Which might not be a terrible thing - going back to school that is - I went back to the MBA program at 34.

[lendaddy]

Thanks John, I appreciate the honesty.

[Jim Sims]

Perhaps you should get some career counseling: take some aptitude and vocational interest tests. Consider what you would like to do, research what it might pay and how and where you would work and then get the required education/training. A college degree is not always needed nor is always the best training for many careers or trades.

A close family member was a retail broker; he quit and went back to school (he "worked his ass off" while in school) and is now doing much better and is much happier in his second career.

Good luck, Jim

[lendaddy]

Originally Posted by Jim Sims

Perhaps you should get some career counseling: take some aptitude and vocational interest tests. Consider what you would like to do, research what it might pay and how and where you would work and then get the required education/training. A college degree is not always needed nor is always the best training for many careers or trades.

A close family member was a retail broker; he quit and went back to school (he "worked his ass off" while in school) and is now doing much better and is much happier in his second career.

Good luck, Jim

I'm sure that's a good plan. I was going to start another thread on careers that don't necessarily require a degree. I'm a quick learner and always test well, which is why I though maybe the market was a good fit. But it seems I may have bought into the hollywood portrayal.

[MRM]

I think what you might be interested in more is becoming a certified financial planner. I don't think a degree is required, it is a national certification from some trade organization. Then you can set up shop advising people on their finances on an hourly rate or trade for them as a broker. Talk to a CFP or stock broker in your town and see what they have to say. Maybe you can intern (if that is the right word - moonlight?) with them part time for a while to get a feel for if you like it.

[legion]

I graduated college in 2000 with a double-major in Finance and BIS (programming).

I had three choices:

1) Stay in college to get my MBA so I could become an analyst.

2) Go into the retail side.

3) Become a computer programmer.

As I weighed the choices, it seemed that I could be making the same money immediately as a programmer that I could post-MBA as an analyst--and I'd have a fraction of the college debt.

My friend's older brother did the retail brokerage thing. The system is basically designed to make you fail. The environment is hyper-competitive. You will earn peanuts until you can build a book of business. Only after you have established yourself will you make any money. Basically, the brokerages don't want to pay for you until you prove yourself worthwhile. If you go this route, expect something like 90% of the people you went through training with to be gone in the first two years. It kind of struck me as a used-car salesman kind of environment, but with more educated people. Expect to work ungodly long hours to make sales--and drink heavily when you are not working.

On the stock analyst side, it is even more competitive: longer hours, heavier drinking, less sleep. You have to differentiate yourself. You need to get yourself on TV with some wild predictions--that turn out true (if not, you're toast). You need to be in a big city like New York, St. Louis (A.G. Edwards and Edward Jones are based there, IIRC), Chicago or such.

That was my impression of these two jobs when I looked into it and started talking to people in the field.

I opted for a cushy, 38.75-hour-a-week job without overtime...

[lendaddy]

Originally Posted by MRM

I think what you might be interested in more is becoming a certified financial planner. I don't think a degree is required, it is a national certification from some trade organization. Then you can set up shop advising people on their finances on an hourly rate or trade for them as a broker. Talk to a CFP or stock broker in your town and see what they have to say. Maybe you can intern (if that is the right word - moonlight?) with them part time for a while to get a feel for if you like it.

Interesting, I appreciate the insight.

[lendaddy]

Originally Posted by legion

I graduated college in 2000 with a double-major in Finance and BIS (programming).

I had three choices:

1) Stay in college to get my MBA so I could become an analyst.

2) Go into the retail side.

3) Become a computer programmer.

As I weighed the choices, it seemed that I could be making the same money immediately as a programmer that I could post-MBA as an analyst--and I'd have a fraction of the college debt.

My friend's older brother did the retail brokerage thing. The system is basically designed to make you fail. The environment is hyper-competitive. You will earn peanuts until you can build a book of business. Only after you have established yourself will you make any money. Basically, the brokerages don't want to pay for you until you prove yourself worthwhile. If you go this route, expect something like 90% of the people you went through training with to be gone in the first two years. It kind of struck me as a used-car salesman kind of environment, but with more educated people. Expect to work ungodly long hours to make sales--and drink heavily when you are not working.

On the stock analyst side, it is even more competitive: longer hours, heavier drinking, less sleep. You have to differentiate yourself. You need to get yourself on TV with some wild predictions--that turn out true (if not, you're toast). You need to be in a big city like New York, St. Louis (A.G. Edwards and Edward Jones are based there, IIRC), Chicago or such.

That was my impression of these two jobs when I looked into it and started talking to people in the field.

I opted for a cushy, 38.75-hour-a-week job without overtime...

Since your story sounds the same as the others I'm guessing my vision was distorted but they are consistent with my less than favorable view of my local brokers life. The poor bastard calls me weekly and I've made it painfully clear that I'm broker than his title. I can't get behind that existence.

[Jim Sims]

"hollywood portrayal"

and televison protrayal,

and protrayal in the popular media (including nearly all electronic news).

None of these are an accurate guide to reality; they are all distorted in order to entertain.

[VaSteve]

Originally Posted by lendaddy

I'm sure that's a good plan. I was going to start another thread on careers that don't necessarily require a degree. I'm a quick learner and always test well, which is why I though maybe the market was a good fit. But it seems I may have bought into the hollywood portrayal.

Mind you I didn't read it, just the title when it popped up on MSN:

http://msn.careerbuilder.com/custom/msn/careeradvice/viewarticle.aspx?articleid=1226&SiteId=cbmsnhp41226&sc_extcmp=JS_1226_home&GT1=10785&cbRecursionCnt=1&cbsid=08519d7a94b9445089cfaae33f1e439b-254875847-KH-5