A college degree, sales ability, good interpersonal and communication skills, and a strong desire to succeed are important qualifications.
Securities and commodities sales agents must pass licensing exams.
Competition for entry-level jobs usually is keen, especially in larger firms; opportunities should be better in smaller firms.
Turnover is high for beginning agents, who often are unable to establish a
sizable clientele; once established, securities and commodities sales agents have a very strong
attachment to their occupation because of their high earnings and considerable investment in training.
Most investors, whether they are individuals with a few hundred dollars to invest or large institutions with millions,
use securities, commodities, and financial services sales agents when buying or selling stocks,
bonds, shares in mutual funds, insurance annuities, or other financial products. In addition, many
clients seek out these agents for advice on investments, insurance, tax planning, estate planning,
and other financial matters.
Securities and commodities sales agents, also called brokers, stockbrokers, registered representatives,
account executives, or financial consultants, perform a variety of tasks, depending on their specific job
duties. When an investor wishes to buy or sell a security, for example, sales agents may relay the order
through their firm’s computers to the floor of a securities exchange, such as the New York Stock Exchange.
There, securities and commodities sales agents known as floor brokers negotiate the price with other
floor brokers, make the sale, and forward the purchase price to the sales agents. If a security is not
traded on an exchange, as in the case of bonds and over-the-counter stocks, the broker sends the
order to the firm’s trading department. Here, using their own funds or those of the firm, other
securities sales agents, known as dealers, buy and sell securities directly from other
dealers, with the intention of reselling the security to customers at a profit. After the
transaction has been completed, the broker notifies the customer of the final price.
Securities and commodities sales agents also provide many related services for their customers.
They may explain stock market terms and trading practices, offer financial counseling or advice on
the purchase or sale of particular securities, and design an individual client’s financial portfolio,
which could include securities, life insurance, corporate and municipal bonds, mutual funds,
certificates of deposit, annuities, and other investments.
Not all customers have the same investment goals. Some individuals prefer long-term investments,
for capital growth or to provide income over a number of years; others might want to invest in
speculative securities, which they hope will quickly rise in price. On the basis of each
customer’s objectives, securities and commodities sales agents furnish information about the
advantages and disadvantages of an investment. They also supply the latest price quotes on any
securities, as well as information on the activities and financial positions of the corporations
issuing the securities.
Most securities and commodities sales agents serve individual investors; others specialize in
institutional investors, such as banks and pension funds. In institutional investing, sales
agents usually concentrate on a specific financial product, such as stocks, bonds, options,
annuities, or commodity futures. At other times, they may also handle the sale of new issues,
such as corporate securities issued to finance the expansion of a plant.
The most important part of a sales representative’s job is finding clients and building a
customer base. Thus, beginning securities and commodities sales agents spend much of
their time searching for customersrelying heavily on telephone solicitation. They
also may meet clients through business and social contacts. Agents often join civic
organizations and other social organizations to expand their networks. Many sales agents
find it useful to contact potential clients by teaching adult education investment courses or
by giving lectures at libraries or social clubs. Brokerage firms may give sales agents lists
of people with whom the firm has done business in the past. Some agents inherit the clients of
agents who have retired. After an agent is established, referrals from satisfied clients are an
important source of new business.
Financial services sales agents sell a wide variety of banking and related services.
They contact potential customers to explain their services and to ascertain customers’ banking
and other financial needs. In doing so, they discuss services such as loans, deposit accounts,
lines of credit, sales or inventory financing, certificates of deposit, cash management, mutual
funds, or investment services. They also may solicit businesses to participate in consumer credit
card programs. Financial services sales agents who serve all the financial needs of a single
affluent individual or a business often are called private bankers or relationship managers.
With deregulation of the financial services industry, the distinctions among sales agents
are becoming less clear as securities firms, banks, and insurance companies venture further
into each other’s products and services. The agents’ jobs also are becoming more important
as competition between the firms intensifies.
Most securities and commodities sales agents work in offices under fairly stressful conditions.
They have access to “quote boards” or computer terminals that continually provide information on the
prices of securities. When sales activity increases, due perhaps to unanticipated changes in the
economy, the pace can become very hectic.
Established securities and commodities sales agents usually work a standard 40-hour week.
Beginners who are seeking customers usually work longer hours. New brokers spend a great deal
of time learning the firm’s products and services and studying for exams in order to qualify
to sell other products, such as insurance and commodities. Most securities and commodities
sales agents accommodate customers by meeting with them in the evenings or on weekends.
A growing number of securities sales agents, employed mostly by discount or online
brokerage firms, work in call-center environments. In these centers, hundreds of agents
spend much of the day on the telephone taking orders from clients or offering advice and
information on different securities. Often, such call centers operate 24 hours a day,
requiring agents to work in shifts.
Financial services sales agents normally work 40 hours a week in a comfortable, less
stressful office environment. They may spend considerable time outside the office,
meeting with current and prospective clients, attending civic functions, and participating
in trade association meetings. Some financial services sales agents work exclusively
inside banks, providing service to walk-in customers.
Because securities and commodities sales agents must be knowledgeable about economic conditions
and trends, a college education is important, especially in larger securities firms.
In fact, the overwhelming majority of workers in this occupation are college graduates.
Although employers seldom require specialized academic training, courses in business
administration, economics, and finance are helpful.
Many employers consider personal qualities and skills more important than academic training.
Employers seek applicants who have considerable sales ability, good interpersonal and
communication skills, and a strong desire to succeed. Some employers also make sure that applicants
have a good credit history and a clean record. Self-confidence and an ability to handle
frequent rejections are important ingredients for success.
Because maturity and the ability to work independently are important, many
employers prefer to hire those who have achieved success in other jobs. Most firms
prefer candidates with sales experience, particularly those who have worked on
commission in areas such as real estate or insurance. Therefore, most entrants
to this occupation transfer from other jobs. Some begin working as securities
and commodities sales agents following retirement from other fields.
Securities and commodities sales agents must meet State licensing requirements,
which usually include passing an examination and, in some cases, furnishing a
personal bond. In addition, sales agents must register as representatives of their firm
with the National Association of Securities Dealers, Inc. (NASD). Before beginners can
qualify as registered representatives, they must pass the General Securities Registered
Representative Examination (Series 7 exam), administered by the NASD, and be an employee
of a registered firm for at least 4 months.
Most States require a second examinationthe Uniform Securities Agents
State Law Examination. This test measures the prospective representative’s
knowledge of the securities business in general, customer protection requirements,
and recordkeeping procedures. Many take correspondence courses in preparation for
the securities examinations. Within 2 years, brokers are encouraged to take
additional licensing exams in order to sell mutual funds, insurance, and commodities.
Most employers provide on-the-job training to help securities and commodities
sales agents meet the registration requirements for certification. In most firms,
the training period takes about 4 months. Trainees in large firms may receive
classroom instruction in securities analysis, effective speaking, and the finer
points of selling; may take courses offered by business schools and associations;
and may undergo a period of on-the-job training lasting up to 2 years. Many firms
like to rotate their trainees among various departments, to give them a broad
perspective of the securities business. In small firms, sales agents often receive
training in outside institutions and on the job.
Securities and commodities sales agents must understand the basic characteristics of
the wide variety of financial products offered by brokerage firms. Brokers periodically
take training through their firms or outside institutions in order to keep abreast of new
financial products and to improve their sales techniques. Computer training also is important,
because the securities sales business is highly automated. It is mandatory for all registered
securities and commodities sales agents to attend periodic continuing education classes to
maintain their licenses. Courses consist of computer-based training in regulatory matters
and company training on new products and services. In addition, more sales agents are
taking courses to become certified financial planners. The Certified Financial Planner
credential issued by the Certified Financial Planner Board of Standards, requires relevant
experience, completion of education requirements, passing a comprehensive examination, and
adherence to an enforceable code of ethics. The CFP exams test the candidate’s knowledge of
the financial planning process, insurance and risk management, employee benefits planning,
taxes and retirement planning, and investment and estate planning.
The principal form of advancement for securities and commodities sales agents is an
increase in the number and size of the accounts they handle. Although beginners usually
service the accounts of individual investors, they may eventually handle very large institutional
accounts, such as those of banks and pension funds. After taking a series of tests, some brokers
become portfolio managers and have greater authority to make investment decisions regarding an
account. Some experienced sales agents become branch office managers and supervise other sales
agents while continuing to provide services for their own customers. A few agents advance to top
management positions or become partners in their firms.
Banks and other credit institutions prefer to hire college graduates for financial
services sales jobs. A business administration degree with a specialization in finance
or a liberal arts degree that includes courses in accounting, economics, and marketing
serves as excellent preparation for this job. Often, financial services sales agents
learn their jobs through on-the-job training under the supervision of bank officers.
However, those who wish to sell mutual funds and insurance products may need to undergo
formal training and pass some of the same exams required of securities sales agents.
Securities, commodities, and financial services sales agents held about 281,000 jobs in 2004.
More than half of jobs were found in securities, commodity contracts, and other financial
investments and related activities. One in 5 worked in depository and nondepository credit
intermediation, including commercial banks, savings institutions, and credit unions.
Although securities and commodities sales agents are employed by firms in all parts of
the country, many work for a small number of large securities and investment banking firms
headquartered in New York City. About 1 out of 8 securities, commodities, and financial
services sales agents were self-employed.
Employment of securities, commodities, and financial services sales agents is
expected to grow about as fast as average for all occupations
through 2014. As people’s incomes continue to climb, they will increasingly seek the advice
and services of securities, commodities, and financial services sales agents to realize their
financial goals. Growth in the volume of stocks traded over the Internet will limit job growth.
Nevertheless, the overall increase in investment is expected to spur employment growth among
these workers, with a majority of transactions still requiring the advice and services of
securities, commodities, and financial services sales agents.
Baby boomers in their peak savings years will fuel much of this increase in investment.
Saving for retirement has been made much easier by the government, which continues to offer
a number of tax-favorable pension plans, such as the 401(k) and the Roth IRA. The
participation of more women in the workforce also means higher household incomes and more
women qualifying for pensions. Many of these pensions are self-directed, meaning that the
recipient has the responsibility for investing the money. With such large amounts of money
to invest, sales agents, in their role as financial advisors, will be in great demand.
Other factors that will affect the demand for brokers are the increasing number and complexity
of investment products, as well as the effects of globalization. As the public and businesses
become more sophisticated about investing, they are venturing into the options and futures
markets. Brokers are needed to buy or sell these products, which are not traded online.
Also, markets for investment are expanding with the increase in global trading of stocks and
bonds. Furthermore, the New York Stock Exchange has extended its trading hours to accommodate
trading in foreign stocks and compete with foreign exchanges.
Employment of sales agents is adversely affected by downturns in the stock market or the
economy. Turnover is high for beginning agents, who often are unable to establish a sizable
clientele even in good times. Once established, securities and commodities sales agents have
a very strong attachment to their occupation because of their high earnings and considerable
investment in training. Competition usually is keen, especially in larger companies with
more applicants than jobs. Opportunities for beginning sales agents should be better in
Employment of financial services sales agents in banks will increase as banks expand their
product offerings in order to compete directly with other investment firms.
Median annual earnings of securities, commodities, and financial services sales agents were $69,200 in May 2004.
The middle half earned between $40,750 and $131,290.
Median annual earnings in the industries employing the largest numbers of
securities, commodities, and financial services sales agents in 2004 were:
Other financial investment activities
Securities and commodity contracts intermediation and brokerage
Management of companies and enterprises
Nondepository credit intermediation
Depository credit intermediation
Stockbrokers, who provide personalized service and more guidance with respect to a
client’s investments, usually are paid a commission based on the amount of stocks,
bonds, mutual funds, insurance, and other products they sell. Earnings from commissions
are likely to be high when there is much buying and selling, and low when there is a slump
in market activity. Most firms provide sales agents with a steady income by paying
a “draw against commission”a minimum salary based on commissions they can be expected to earn.
Securities and commodities sales agents who can provide their clients with the most thorough financial
services should enjoy the greatest income stability. Trainee brokers usually are paid a salary until
they develop a client base. The salary gradually decreases in favor of commissions as the broker
gains clients. A small, but increasing, number of full-service brokers are paid a percentage of
the assets they oversee. This fee often covers a certain number of trades done for free.
Brokers who work for discount brokerage firms that promote the use of telephone and online
trading services usually are paid a salary, sometimes boosted by bonuses that reflect the
profitability of the office. Financial services sales agents usually are paid a salary also;
however, bonuses or commissions from sales are starting to account for a larger share of their income.
Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook, 2006-07 Edition,
Securities, Commodities, and Financial Services Sales Agents, on the Internet at
(visited June 21, 2006).