A Comprehensive Guide to Wall Street Stock Brokers and Firms

Wall Street is home to many stock brokers and firms, each with their own unique characteristics. Fidelity Investments, for example, is one of the largest online brokerages in the US, with over 30 million customer accounts.

Some of the most well-known stock brokers and firms on Wall Street include Goldman Sachs, Morgan Stanley, and JPMorgan Chase. These firms have been around for decades and have a reputation for providing top-notch services to their clients.

Many of these firms offer a range of services, including investment advice, portfolio management, and trading. Charles Schwab, for instance, is known for its low-cost trading options and user-friendly online platform.

A unique perspective: Stocks and Trading

The history of Wall Street is a long and fascinating one. The first recorded buying and selling of shares occurred in Rome in the 2nd century BC.

Stockbroking as a profession didn't take off until after the Renaissance, when government bonds were traded in Italian city-states such as Genoa and Venice. This marked a significant shift in the way people invested and traded securities.

The Amsterdam Stock Exchange, now known as Euronext Amsterdam, became the first official stock market in 1602, with trading in shares of the Dutch East India Company, the first company to issue stock. This was a major milestone in the development of modern stock markets.

Additional reading: What Are Stocks and Shares

Wall Street got its name from a physical wall built in New York when the town was still a Dutch colony. Governor Peter Stuyvesant called for a 10-foot wall to be built, protecting the lower part of the peninsula from Native Americans.

The street became known for being a marketplace where traders and buyers met to conduct business. Formal rules were established in 1792 to authorize and legitimize their business, leading to the eventual formation of the NYSE.

In 1792, a group of 24 stockbrokers signed the Buttonwood Agreement, agreeing to trade five securities under a buttonwood tree in New York City. This marked the beginning of the New York Stock Exchange.

The first official stock market, the Amsterdam Stock Exchange, was established in 1602, trading shares of the Dutch East India Company.

Related reading: Stock Exchange

The Crash of 1929 was a pivotal moment in Wall Street's history, triggering the Great Depression. It was not the first economic depression or market crash in the U.S., but it was a massive stock sell-off that had a lasting impact.

The stock market had been hugely overbought for quite some time, and even the sharpest traders like Jesse Livermore knew it. This led to a small sell-off that quickly turned into a major panic.

The Dow Jones lost all of its previous gains for the year in a matter of hours at the end of October, and nearly 25% of its total gains for the decade. This was a staggering loss that had far-reaching consequences.

Many individuals lost faith in the country's entire economic system, leading to a massive withdrawal of money from banks. This caused the collapse of many financial institutions.

The stock market crash and the following depression led to the first major regulation of stock market trading. Close government oversight was instituted by the newly-created Securities and Exchange Commission.

Curious to learn more? Check out: Equity Market Analyst

Working as a stock broker can be a challenging yet rewarding career. Most brokers in the United States don't work on the NYSE trading floor, but for brokerage firms such as Merrill Lynch and Morgan Stanley.

Many positions don't require a college degree, and a brokerage firm provides on-the-job training for newly hired brokers. Professional licensing is required by the U.S. government, and stockbrokers must pass the Series 63 and Series 7 exams before they can legally make trades.

A large portion of brokers fail to meet their sales quota and are forced to look for work at another firm or in another profession. To meet the sales quota, brokers have to do a lot of cold calling and client meetings, making it a successful model for most people who enter this line of work.

Related reading: Investment Sales Broker

A day in the life of a stockbroker is quite long and begins several hours before trading opens for the day. Typically, a broker gets to work early to read financial news and begin researching trades.

The day starts at around 6:30 or 7:00 with market research and responses to client emails. Brokers don't buy or sell shares of stocks for themselves on the New York Stock Exchange trading floor.

Consider reading: What Does Trading Stocks Mean

The trading floor is extremely fast-paced, especially near the times of the opening and closing bells. This chaotic atmosphere is a hallmark of the early morning and late afternoon hours.

By about 10:00, the trading floor calms down, and most trades between 10:00 am and 3:30pm are made by algorithms and software. These programs are controlled by stockbrokers who input information into them, such as opening prices and numbers of shares.

Additional reading: Floor Broker

Working in a firm can be a great way to start your career as a stockbroker. Most brokers in the United States work for brokerage firms like Merrill Lynch and Morgan Stanley, which is easier to get into than a position on the NYSE trading floor.

The educational requirements for becoming a stockbroker are more modest than in other areas of finance, and many positions don't require a college degree. Professional licensing is required by the U.S. government, and stockbrokers must pass the Series 63 and Series 7 exams before they can legally make trades.

A brokerage firm provides on-the-job training for newly hired brokers, but it's a competitive environment. A large portion of brokers fail to meet their sales quota and are forced to look for work at another firm or in another profession.

To succeed in this line of work, you'll need to be good at sales and have strong communication skills. Stockbrokers are essentially salespeople, and they need to be able to persuade clients into buying or selling their stock shares.

Stockbrokers are often portrayed as greedy, money-hungry individuals, but this couldn't be further from the truth. Many stockbrokers don't even hit the six-figure salary mark.

Stock trading is a high-stress career that can take a toll on emotional and physical health. Stockbrokers ride the market rollercoaster and worry about every big-dollar trade.

Most stockbrokers don't physically work at the NYSE, and many dress casually, spending their days behind a computer in a cubicle. They can be found in offices across America, from the Dakotas to Alaska.

Graduating from an Ivy League school and heading straight to Wall Street isn't the usual path for stockbrokers. They put in the effort for internships and on-the-job training instead.

Trading stocks is way more complex than placing bets or rolling the dice in Las Vegas. It requires learning the right strategies to beat the market and profit.

The job outlook for stockbrokers is a mixed bag. The Bureau of Labor Statistics calculates a mean annual wage of $98,770 for stockbrokers.

The employment of stockbrokers is expected to rise only four percent from 2018 to 2028, according to the U.S. Department of Labor. This is slower than average job growth.

There will be about 18,500 openings nationwide for stockbrokers this decade. This means the job market is competitive, and aspiring stockbrokers will need to stand out from the crowd.

Stockbrokers with an MBA or M.S. in Finance and the Chartered Financial Analyst certification have the best hiring chances.