View source for Stockbroker

{{Short description|Professional who buys and sells shares for others}}
{{Infobox occupation
| name               = Stockbroker
| image              = [[File:Stockbroker.jpg|250px]]
| caption            = A [[stock trader]] with a [[multi-monitor]] workstation, including a [[Bloomberg Terminal]]
| official_names     = Stockbroker<BR>Investment adviser<BR>Share broker<BR>Registered representative<BR>Trading representative<BR>Investment broker<BR>Investment adviser<BR>Financial adviser<BR>Wealth manager<BR>Investment professional
| type               = Profession
| activity_sector    = [[Finance]]
}}
{{Personal finance}}

A '''stockbroker''' is an individual or company that buys and sells [[Share capital|stock]]s and other [[investment]]s for a [[financial market participant]] in return for a [[commission (remuneration)|commission]], [[Markup (business)|markup]], or [[fee]].  In most countries they are regulated as a [[broker]] or [[broker-dealer]] and may need to hold a relevant license and may be a member of a [[stock exchange]]. They generally act as a [[financial adviser]] and [[investment manager]]. In this case they may also be licensed as a financial adviser such as a [[registered investment adviser]] (in the United States).

Examples of professional designations held by individuals in this field, which affects the types of investments they are permitted to sell and the services they provide include [[chartered financial consultant]]s, [[certified financial planner]]s or [[chartered financial analyst]]s (in the United States and UK), [[chartered financial planner]]s (in the UK).

In the United States, the [[Financial Industry Regulatory Authority]] provides an online tool designed to help understand professional designations.<ref>{{cite web|last=komsan|first=seksun|title=Understanding Professional Designations|url=https://www.finra.org/investors/professional-designations|access-date=October 9, 2020|website=seksun_komsan.org.co.th|publisher=[[Financial Industry Regulatory Authority]]}}</ref>

==History of stock broking==
{{Main|Stock exchange}}
{{Cquote|(...) This enigmatic business [i.e. the inner workings of the [[:nl:Beurs van Hendrick de Keyser|stock exchange in Amsterdam]], primarily the practice of [[Dutch East India Company|VOC]] and [[Dutch West India Company|WIC]] stock trading] which is at once the fairest and most deceitful in Europe, the noblest and the most infamous in the world, the finest and the most vulgar on earth. It is a quintessence of academic learning and a paragon of fraudulence; it is a touchstone for the intelligent and a tombstone for the audacious, a treasury of usefulness and a source of disaster, (...) The best and most agreeable aspect of the new business is that one can become rich without risk. Indeed, without endangering your capital, and with out having anything to do with correspondence, advances of money, warehouses, postage, cashiers, suspensions of payment, and other unforeseen incidents, you have the prospect of gaining wealth if, in the case of bad luck in your transactions, you will only change your name. Just as the [[Hebrews]], when they are seriously ill, change their names in order to obtain relief, so a changing of his name is sufficient for the speculator who finds himself in difficulties, to free himself from all impending dangers and tormenting disquietude.|200px||[[Joseph de la Vega]], in his book ''Confusión de confusiones'' (1688), the earliest book about [[stock trading]]<ref>[[Joseph de la Vega|De la Vega, Joseph]]: ''Confusión de confusiones (1688): Portions Descriptive of the Amsterdam Stock Exchange''. Selected and translated by Hermann Kellenbenz. ([[Cambridge, MA]]: Baker Library, Harvard Graduate School of Business Administration, 1957)</ref>}}

The first recorded buying and selling of [[shares]] occurred in [[Rome]] in the 2nd century BC.<ref>{{cite book|url=https://books.google.com/books?id=03KYDwAAQBAJ&pg=PA17|title=Money Changes Everything: How Finance Made Civilization Possible|page=17|last=Goetzmann|first=William N.|publisher=Princeton University Press|year=2017|isbn=9780691178370}}</ref> After the [[fall of the Western Roman Empire]], stockbroking did not become a profession until after the [[Renaissance]], when government [[Bond (finance)|bond]]s were traded in [[Italian city-states]] such as [[Genoa]] and [[Venice]].<ref>{{cite book|url=https://books.google.com/books?id=ot05CgAAQBAJ&pg=PA24|title=Government Debts and Financial Markets in Europe|page=24|last=Piola Caselli|first=Fausto|publisher=Routledge|year=2015|isbn=9781317314233}}</ref> In 1602, the Amsterdam Stock Exchange (now [[Euronext Amsterdam]]) became the first official [[stock market]] with trading in shares of the [[Dutch East India Company]], the first company to issue stock.<ref>{{cite web | url=https://www.investopedia.com/ask/answers/08/first-company-issue-stock-dutch-east-india.asp | title=What Was the First Company to Issue Stock? | first=Andrew | last=Beattie | work=Investopedia | date=December 13, 2017|access-date=October 9, 2020}}</ref> In 1698, the [[London Stock Exchange]] opened at the [[Jonathan's Coffee-House]].<ref>{{cite book|url=https://books.google.com/books?id=ayTn49BJewAC&pg=PA277|title=Market Players: A Guide to the Institutions in Today's Financial Markets|last=Rolland|first=Gail|page=277|publisher=John Wiley & Sons|year=2010|isbn=9780470665558}}</ref> On May 17, 1792, the [[New York Stock Exchange]] opened under a [[platanus occidentalis]] (buttonwood tree) in [[New York City]], as 24 stockbrokers signed the [[Buttonwood Agreement]], agreeing to trade five securities under that buttonwood tree.<ref>{{cite web | url=https://guides.loc.gov/wall-street-history/exchanges | title=Wall Street and the Stock Exchanges: Historical Resources | publisher=[[Library of Congress]] | date=June 12, 2018|access-date=October 9, 2020}}</ref>

==Licensing and training requirements==
{{See also|List of securities examinations}}

===Australia===
Up until January 1, 2019, investment professionals that offer financial advice in [[Australia]] had to pass training pursuant to [[RG146]].<ref>{{cite web|url=https://www.moneymanagement.com.au/news/financial-planning/rg146-cpd-no-longer-required|title=RG146 CPD no longer required|last=Goh|first=Jassmyn|website=moneymanagement.com.au|date=June 10, 2020|access-date=October 9, 2020}}</ref> They must hold an [[Australian Financial Services Licence]] that is overseen by the [[Australian Securities and Investments Commission]].<ref>{{cite web|title=Financial advice|url=https://www.moneysmart.gov.au/investing/financial-advice|access-date=October 9, 2020|publisher=[[Australian Securities and Investments Commission]]}}</ref> They are subject to [[fiduciary]] obligations.

As of 2019, Australia's biggest online stockbroker was [[Commonwealth Securities]], other large brokers were [[Australia and New Zealand Banking Group|ANZ Share Investing]], [[National Australia Bank|nabtrade]] and [[Westpac|Westpac Online Investing]].<ref>{{cite web|url=https://www.smh.com.au/business/banking-and-finance/commsec-profits-fall-20-8-per-cent-amid-market-turbulence-58979121-p52w6z.html|title=CommSec profits fall 20.8 per cent amid market turbulence|last=Yeates|first=Clancy|publisher=[[The Sydney Morning Herald]]|date=September 30, 2019|access-date=October 9, 2020}}</ref>

===Canada===
In [[Canada]], to be licensed as a "registered representative" or an "investment advisor" and thus be qualified to offer investment advice and trade all instruments with the exception of derivatives, an individual employed by an investment firm must have completed the [[Canadian Securities Course]], the Conduct & Practices Handbook, and the 90-day Investment Advisor Training Program. Within 30 months of obtaining designation as a "registered representative", the registrant is further required to meet the post-licensing proficiency requirement to complete the Wealth Management Essentials course. A registered representative is also required to complete 30 hours of professional development (product knowledge) and 12 hours of compliance training every three year continuing education cycle as set out by the Investment Industry Regulatory Organization of Canada. To trade options and/or futures, a registered representative must pass the Derivatives Fundamentals Course in addition to the Options Licensing Course and/or the Futures Licensing Course, or alternatively, the Derivatives Fundamentals Options Licensing Course for options.<ref>{{cite web | url=https://www.csi.ca/student/en_ca/careermap/index.xhtml?icid=LNK-CSICMT--I01#node:investmentAdvisor | title=CSI Career Map - CSI Global Education | publisher=[[Canadian Securities Institute]]}}</ref><ref>{{cite web | url=http://www.iiroc.ca/industry/continuingeducationmember/Documents/CE-Requirements-Category_en.pdf | title=Continuing Education/Approval Category Chart | publisher=[[Investment Industry Regulatory Organization of Canada]]}}</ref><ref>{{cite web | url=http://www.iiroc.ca/industry/continuingeducationmember/Pages/default.aspx |title=Continuing Education & Member Resources | publisher=[[Investment Industry Regulatory Organization of Canada]]}}</ref>

===Hong Kong===
In [[Hong Kong]], to become a representative one has to work for a licensed firm and pass 3 exams to prove competency. Passing a fourth exam results in obtaining a "specialist" license. All tests can be taken with the Hong Kong Securities Institute.<ref>{{cite web|url=https://www.scmp.com/business/money/markets-investing/article/k0401999/hong-kong-puts-financial-professionals-test|title=Hong Kong puts financial professionals to the test|last=Yiu|first=Enoch|publisher=[[South China Morning Post]]|date=December 1, 2012|access-date=October 9, 2020}}</ref> After passing all tests, approval must be received by the [[Securities and Futures Commission]].

===India===
Share brokers in [[India]] are governed by the [[Securities and Exchange Board of India Act, 1992]] and brokers must register with the [[Securities and Exchange Board of India]] (SEBI). The [[National Stock Exchange of India]] and the [[Bombay Stock Exchange]] via brokers, provide an ecosystem to investors to trade in capital markets through various channels - broker offices, investment advisor or screen-based electronic trading system. An individual employed by an investment firm must complete the National Institute of Securities Markets (NISM) exam and apply to SEBI for registration as an '''Investment''' Advisor.<ref>{{cite web|url=https://www.thehindubusinessline.com/markets/sebi-prescribes-norms-for-investment-advisors/article0911600234.ece|title=SEBI prescribes norms for investment advisors|publisher=[[Business Line]]|date=September 24, 2020|access-date=October 9, 2020}}</ref>

Stock market advisory and research services are highly regulated in India. Only SEBI registered stock advisory and investment research analysts are allowed to do so. The complete details of these authorized persons are available on website of SEBI for protection of investors.

===Ireland===
The recognized benchmark designation for investment professionals in [[Ireland]] is the QFA ("qualified financial adviser") designation, which is awarded to those who pass the Professional Diploma in Financial Advice and agree to comply with the ongoing "continuous professional development" (CPD) requirements. The qualification, and attaching CPD program, meets the "minimum competency requirements" specified by the Financial Regulator, for advising on and selling five categories of retail financial products:
* Stock shares, bonds, and other investment instruments
* Savings, investments, and pensions
* Mortgage loans
* Consumer credit
* Life insurance

As of 2019, [[Davy Group|Davy]] and [[Goodbody Stockbrokers|Goodbody]] were Irish largest stockbrokers.<ref>{{cite web|url=https://www.irishtimes.com/business/personal-finance/so-you-want-to-invest-in-the-stock-market-what-will-it-cost-1.4047803|title=So you want to invest in the stock market: what will it cost?|last=Hamilton|first=Peter|publisher=[[The Irish Times]]|date=October 15, 2019|access-date=October 9, 2020}}</ref>

===New Zealand===
In [[New Zealand]], the [[New Zealand Qualifications Authority]] oversees qualifications. The New Zealand Certificate in Financial Services (Level 5) is the minimum level of qualification necessary to offer investment advice.<ref>{{cite web | url=https://skills.com.nz/careers-and-courses/business/financial-services/authorised-financial-advisers/ | title=For Individuals Seeking to Complete the Level 5 qualification | publisher=Skills Organisation}}</ref>

===Singapore===
In [[Singapore]], becoming a trading representative requires passing 4 exams, modules 1A, 5, 6 and 6A, from the Institute of Banking and Finance and applying for the license through MAS{{clarify|What is MAS?|date=August 2019}} and SGX.{{clarify|What is SGX?|date=August 2019}}

===South Africa===
The [[Johannesburg Securities Exchange]] rules require that member firms must be under the control of a "qualified stockbroker", who is also an [[executive director]] of the firm; and branches, likewise managed. 
<ref>{{Cite web|url=https://www.saqa.org.za/docs/webcontent/2019/SAISgazettereport-20181108.pdf|title=SAIS Gazette Report}}</ref>
The South African Institute of Stockbrokers (SAIS) <ref>[https://www.sais.co.za/ South African Institute of Stockbrokers], sais.co.za</ref> offers the six exams required to become such, a Certified Stockbroker, or CSb(SA), following 3 years' work experience, and with other educational requirements met.<ref>[https://www.sais.co.za/education/professional-stockbroker-exams Professional Stockbroker Exams], sais.co.za</ref> 
SAIS also offers the ''Financial Markets Practitioner'' [[South African Qualifications Authority#The National Qualifications Framework|vocational certification]]<ref>[https://www.sais.co.za/education/financial-markets-practitioner-fmp-qualification Financial Markets Practitioner], sais.co.za</ref> as well as various "Regulatory Recognition" examinations.
<ref>[https://www.sais.co.za/education/financial-markets-professional-regulatory-recognition-fmprr-examinations Financial Markets Professional Regulatory Recognition Examinations], sais.co.za</ref>
See also re. "Regulated Positions" and "Registered Persons" at [[South African Institute of Financial Markets]].

===South Korea===
In [[South Korea]], the [[Korea Financial Investment Association]] oversees the licensing of investment professionals.

===United Kingdom===
Stockbroking is a regulated profession in the [[United Kingdom]] and brokers must achieve a recognised qualification from the Appropriate Qualifications list of the [[Financial Conduct Authority]] (FCA).<ref>{{cite web|url=https://hostingdata.co.uk/best-online-trading-platform/|title=Best Online Trading Platform (UK) in 2020|last=Williams|first=Alex|website=hostingdata.co.uk|date=September 17, 2020|access-date=October 9, 2020}}</ref> 

The [[Chartered Institute for Securities & Investment]] (CISI), established in 1992, is the largest UK professional body for investment professionals.<ref>{{cite book|url=https://books.google.com/books?id=oL2XUi60pAAC&pg=PA342|title=The Handbook of News Analytics in Finance|last1=Mitra|first1=Gautam|author1-link=Gautam Mitra|last2=Mitra|first2=Leela|publisher=John Wiley & Sons|year=2011|isbn=9781119990802}}</ref> It evolved from the London Stock Exchange, has around 45,000 members in over 100 countries and delivers more than 40,000 exams each year.<ref>{{cite web|url=https://www.financial-expert.co.uk/about-the-chartered-institute-for-securities-investment-cisi/|title=About The CISI|last=Oates|first=Simon|website=financial-expert.co.uk|date=February 1, 2022|access-date=February 2, 2022}}</ref> 

CFA UK <ref>{{Cite web|url=https://www.cfauk.org/|title=CFA UK &#124; Building a better investment profession|website=www.cfauk.org}}</ref> also offers various FCA Appropriate Qualifications.<ref>[https://www.cfauk.org/learn/qualifications Qualifications], cfauk.org</ref> It represents the interests of around 12,000 investment professionals and is part of the worldwide network of members of the [[CFA Institute]].<ref>{{cite web|url=https://www.ftadviser.com/investments/2020/10/09/investment-sector-fears-major-restructure-and-staff-cuts/|title=Investment sector fears major restructure and staff cuts|last=Tew|first=Imogen|publisher=[[Financial Times]] Adviser|date=October 9, 2020|access-date=October 9, 2020}}</ref>

===United States===
{{See also|Registered investment adviser}}
The [[Financial Industry Regulatory Authority]], a [[self-regulatory organization]], regulates investment professionals in the [[United States]]. Exams that individuals may take for accreditation include the [[Series 7 exam]], the [[Uniform Securities Agent State Law Exam]] (Series 63), the [[Uniform Combined State Law Exam]] (Series 66), and the [[Uniform Investment Adviser Law Exam]] (Series 65).<ref>{{cite web|url=https://www.thestreet.com/how-to/how-to-become-a-financial-advisor-14650926|title=How to Become a Financial Advisor: What You Need to Know|publisher=[[TheStreet.com]]|last=Fiorillo|first=Steve|date=August 22, 2019|access-date=October 9, 2020}}</ref>

Individuals holding some of those licenses, such as the [[Series 6 exam]], cannot be called stockbrokers since they are prohibited from selling stocks.{{citation needed|date=October 2020}} Selling variable products, such as a [[variable annuity]] contract or [[variable universal life insurance]] policy, typically requires the broker to also have one or another state insurance department licenses.

Individuals and firms are regulated by the [[U.S. Securities and Exchange Commission]] and laws related to the [[Investment Advisers Act of 1940]], including laws related to [[fiduciary]].

==See also==
{{Commons category|Stockbrokers}}
* [[Boiler room (business)]]
* [[Floor broker]]
* [[Mutual fund]]
* [[Prime brokerage]]
* [[Securities market]]
* [[Stock market data systems]]
* [[Stock trader]]
* [[Stock valuation]]

==References==
{{Reflist|30em}}
{{Stock market}}
{{finance}}
{{Authority control}}

[[Category:Financial services occupations]]
[[Category:Stockbrokers| ]]