Becoming A Broker?
Q: Napoleon and I have almost identical stories to tell. Even the dates of trading stocks and options in school and the employment in the early 70's.
A:
After following the market from age 14 or so, I too
traded in school and later became a broker in
Memphis. I was hired by an Investment Banking firm
as a bond trader, worked under their wing for several months until I
sat for and passed the test.
My job? Cold calling banks across the country and
convincing their Trust Officers to do bus
"building your book" was the
first item on the agenda and I saw many guys have
their books and notes actually raked off their desk by the floor manager
and "asked to leave".
I was a pretty good trader, however, the business was "cut-throat" in
that a Vice President of the firm
would take any new accounts I came up with. I would get the initial
trade but couldn't call the bank
again, which was the whole idea of cold-calling.
Try calling a large bank's trust department out of the
blue and selling them $100 to $250M in bonds.
A trade? Buy $100M from bank A at 6.50% and sell
them to bank B at 6.00%, the banks being across the street from each
other!
The retail client thought he could do it on his own. What happened, was he
got burned chasing last year's hot stocks and funds, following Money
magazine and listening to this NG. The public wants advice, but it also
wants a fair shake. The public feels it is getting that fair shake with the
fee based business. If the accounts grows by 25%, the broker just got a 25%
raise in pay. It's a win-win situation. Eventually there will be no
commission.