How to Become A Stock Broker South Africa

A stockbroker is a financial professional who executes orders in the market on behalf of clients. A stockbroker may also be known as a registered representative (RR) or an investment advisor. Most stockbrokers work for a brokerage firm and handle transactions for a number of individual and institutional customers.

What is the role of stock brokers?

A stock broker is an intermediary who enables buying and selling of stocks and securities in a stock exchange on behalf of financial institutions and firms.

Who is stock broker and what is its role?

The role of a stock broker is to facilitate the buying and selling of stocks at the stock markets, on behalf of investors. There are many prominent stock brokerage firms in India through which you can trade in stock exchanges.

Can I do trading without broker?

You can invest in the Share Market without a broker also. Yes, my friend you can invest in the share market without any broker and also you can save some cost like brokerage charges. Another option of investing in the stock market with any broker is through the Direct Stock Purchase Plan (DSPP).

How To Become A Stockbroker In South Africa & Subjects Needed

Are you looking for a way to become a Stockbroker in South Africa and you don’t know the subjects needed or even universities in South Africa where you can undergo the course? If yes, then this informative article is for you. You will be given detailed information about how to become a Stockbroker in South Africa, Universities and Subjects Needed.

What Does A Stockbroker Do?

Stockbrokers are professionals who manage financial investment portfolios for individuals, companies and large organisations. It is their job to get the best financial return for their clients by buying and selling stocks, shares, and other financial products.

Stockbrokers offer three types of service: discretionary – managing a client’s investments and making decisions on their behalf; advisory – advising clients about various investment options; execution-only – buying and selling only when clients ask, without giving advice.

For all types of service, a stockbroker’s work would involve:

Interviewing clients to assess their potential in the financial marketplace

Offering advice to clients about which funds or companies to buy or sell

Calculating and recording the prices of transactions

Managing and reviewing clients’ investment portfolios

Researching financial markets

Consulting investment analysts

Keeping clients informed about their investments and changes in the market

Instructing stock market traders to achieve the best market prices

Marketing their services to new clients.

What Qualifications Do I Need?

Although there are no set qualifications for becoming a stockbroker, most employers will expect prospective employees to have a degree or, even better, a postgraduate qualification such as an MSc or MBA.

A relevant university degree, work experience, and passing additional stock exchange exams are required for a position as a portfolio manager, sector or market analyst, institutional dealer, international arbitrageur, a strategist in the derivative department, or administrator.

For employment as a securities clerk (authorised and unauthorised), candidates attend an in-service training programme offered by the Johannesburg Stock Exchange (JSE) and take an oral exam on stock exchange rules and regulations.

What Subjects Do I Need?

Contact each institution for their specific requirements, but these subjects are recommended:

Mathematics

Physical Science

Accountancy

Economics

Where Can I Study?

University of Johannesburg

  • Bachelor of Commerce: Economics and Econometrics
  • www.uj.ac.za

Nelson Mandela Metropolitan University

North-West University

  • Bachelor of Commerce: Quantitative Risk Management; Bachelor of Commerce: Risk Management; Bachelor of Science: Computer, Economic and Mathematical Sciences
  • www.nwu.ac.za

Below are steps to Become A Stock Broker South Africa

Professionals seeking jobs in finance may choose to pursue a number of paths toward a career as a stockbroker. Here are some key steps that could help you get there.

1. Earn a Bachelor’s Degree

Stockbrokers need to have an extensive understanding of finance, and most brokerage firms require candidates to have at least a bachelor’s degree.

Earning an undergraduate degree in a business-related field like accounting, economics, or finance, such as an online bachelor’s in financial services, can help provide aspiring stockbrokers with a background in financial analysis and planning, investment techniques, financial institutions, and portfolio management.

2. Earn a Master of Business Administration

Many brokerage firms do not require candidates to have a Master of Business Administration (MBA) to become stockbrokers. However, the degree can be useful for stockbrokers who are seeking more competitive positions, looking to obtain a higher salary, or pursuing a more senior role in their firm.

3. Gain Professional Experience

Many firms require broker candidates to have professional experience in business or finance. This experience can be acquired through internships with brokerage firms or other financial organizations.

It is also beneficial for interns and professionals to have other experience in finance or a related field, which can help raise a stockbroker’s salary expectations.

4. Pass Required Qualification Exams

All brokerage firms will require that employees obtain the necessary government licenses before they can become a stockbroker. Administered by the Finance Industry Regulatory Authority, each of these licenses certifies that a financial representative is able and registered to practice in a certain field.

Stockbrokers are required to pass the Series 7 General Securities Representative Exam to become licensed. Often, firms will offer training to help their stockbroker candidates prepare for these exams. 

How long does it take to become a broker in South Africa?

The South African Institute of Stockbrokers is in the process of registering a formal, three-year university qualification for the financial markets, and is currently working with the University of Johannesburg and government to put the course together.

What qualifications do you need to be a stock broker in South Africa ?

There are no set qualifications if you want to become a Stockbroker, although most employers will expect you to have a degree (normally class 2:1 or above). Your degree could be in any subject, but economics, business, finance or accountancy may give you the edge.

Is stockbroker a dying career in South Africa ?

Yes, the stockbroker career is experiencing a slow but sure death. For the most substantial part, this can be attributed to the advent of technology.

The role of stockbrokers is to act as middlemen between investors and firms. They facilitate the buying and selling of stocks for investors for a commission.

How much does a stock broker cost in South Africa?

South Africa Stock Broker Fees: What you Need to Know

Stock BrokerCharge Per TradeConversion Fee
AvaTrade0% Commission, 0.13% Spread0.50%
IG100 ZAR minimum on SA Stock CFDs0.50%
Interactive Brokers$0.005 per share ($1 minimum)0.1 – 0.2 basis points, minimum of $2
Absa Stockbrokers0.4% (120 ZAR minimum)0% on JSE trades

Is stockbroker a good career in South Africa ?

If you enjoy sales, are a self-starter and have an interest in the world of finance, a career as a stockbroker may be a great fit for you.

With a high earning potential and fulfillment from developing your own base of clients, a stockbroker can be a good career for a hardworking and ambitious individual.

Are stockbrokers rich in South Africa ?

The average stockbroker doesn’t make anything near the millions that we tend to imagine. In fact, some lose a lot of money through their trading activities.

The majority of companies pay their employees a base salary plus commission on the trades they make. That’s because they’re supposed to earn more in commissions.

What is the cheapest broker in South Africa?

The Cheapest Online Trading Platforms South Africa

BrokerTrust ScoreMinimum deposit
AvaTrade98%$100
98%$50
Plus50080%$100
IQ OPTION80%$10

Is a stockbroker a hard job in South Africa ?

Working as a stockbroker sounds like a glamorous career, but the fact is that many first-year brokers drop out of the business because the job usually requires long hours, can be overly stressful, and the business requires a substantial amount of dedication.