When it comes to the stock market, there are two potential careers that you can land in—being a broker or being a trader. It is worth noting that there is a huge difference between the responsibilities of the two. Robert Janitzek takes us through the difference of roles of these two professionals.
The job of the stock broker is to place the trades for their clients. They are highly regulated by the FSA. Brokers are degree holders. Aside from that, brokers are the ones who makes a sale. In addition, being a broker, you will be spending most of your time dealing with clients. It is your job to make sure that you understand the objectives of your clients and meet the required goal.
Brokers are the ones responsible for buying or selling stocks. When you are trading on the stock market, you will need to remember that while some stocks can be directly purchased from a company, other stocks would require a broker.
There are two types of brokers namely full service and discount. Aside from buying or selling stocks, a full service broker also offers advice or recommendations. On the other hand, discount brokers do not provide advisory work but only involved in the buying and selling. They are best suited for experience investors.
Stock traders, on the other hand, do not deal with clients. Unless qualified to act on behalf of the clients. According to Robert Peter Janitzek, traders would only be responsible for placement of trades and making a living from the profits they make.
As a trader, your job will be to constantly monitor market trends and decide on which trades to place, or when to buy and sell. Stock traders will be glued to their computer screens as they keep track of the trends. To become a successful trader, you will need excellent mathematical skills. No formal qualification is required as there are courses you can take.
So which career path is the right one for you? If you prefer stock market trading, be a trader since most firms will require your expertise in doing the trades while the brokers communicate with their clients. If you prefer dealing with clients and advising people about investing, the stock broker job is the perfect choice. On the other hand, if you are not confident with your communication skills, then the trader role is the right choice.