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career in stock market for a CA!

CA Kripa Sah (Chartered Accountant) (254 Points)

12 June 2009

pls frnds!

i am in CA FINAL...and its my deep desire to develop my career in stock market!

not as analyst/technician....i:e: from basic knowledge i want to do work in this field ....i want to earn through it!!

can anyone guide me???how to begin with??

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2 Replies

Sourabh Sharma (CS CA (Final) M.com NCFM Derivative Capital Market Mutual Funds) (771 Points)
Replied 12 June 2009

Taking stock of your career

Financial markets across the world are getting integrated and complex due to technological advancements and free-market policies of the erstwhile closed economies. Market professionals need to be equipped with the knowledge of various market processes, an understanding of the greater role of various segments of the markets.

How do stock markets operate?

Stock exchanges are like market places where stockbrokers buy and sell securities for individuals or institutions. As per the SCRA (Securities Contracts Regulation Act) 1956, the definition of securities includes shares, bonds, scrips, stocks, debentures, government securities, derivatives of securities, units of collective investment scheme (CIS) etc.

The securities market has two interdependent segments: the primary and secondary market. The primary market is the channel for creation of new securities issued by public limited companies or by government agencies. New securities issued in the primary market are traded in the secondary market. The secondary market operates through the over-the-counter (OTC) market and the exchange-trade market.

Career opportunities and pre-requisites

Stockbrokers buy and sell stocks, bonds, and other sorts of investments on behalf of their clients, who could be individuals or corporations. Because every investment involves risk, stockbrokers work under a great deal of stress. They must often act quickly, since day-to-day and even hour-to-hour stock market fluctuations could mean the gain or loss of substantial amounts of money. They must be good with figures and good at keeping a cool head when working with enormous sums of money. Buying and selling securities, insurance and commodities demands good interpersonal and sales skills and being well-informed about various investment products.
Jobs in investment banking include those of financial managers, financial analysts and assistants. Researchers and analysts should have a good memory coupled with strong quantitative skills. Fixed income trading positions and derivatives traders require strong analytical skills.

Financial planners must have excellent inter-personal skills in addition to professional skills.

Portfolio managers are responsible for making investment decisions for clients with large sums of money to invest. They need to be well informed about the goals of the client.

Due to advances in telecommunications and computer technology, the securities and commodities industry has become highly automated. Consequently, computer scientists, computer engineers and systems analysts also find employment in the industry today.
Training

Graduation may not be necessary for becoming a stock broker, but many are business administration or commerce graduates. Formal educational or training programme on securities markets is not easily available. This has necessitated the need for certification.
National Stock Exchange of India Ltd. (NSE) has evolved a testing and certification mechanism known as the National Stock Exchange's Certification in Financial Markets (NCFM) which is online and fully automated. It offers all certifications mandated by Securities and Exchange Board of India (SEBI), IRDA, National Securities Depository Limited (NSDL), AMFI, Fixed Income Money Markets and Derivatives Association (FIMMDA) and the NSE itself. Practical knowledge and skills are tested in nine securities market related modules. These tests ensure that a person dealing with financial products has a minimum knowledge of them, the markets and regulations. Hence it is required that all new employees joining the intermediaries and all intermediaries joining the market should be certified.
The Association of Mutual Funds in India (AMFI) has started the AMFI Mutual Fund Certification (www.amfiindia.com / testingprogram.html). The AMFI Mutual Fund (Basic) Module is a general test and the second module is the AMFI Mutual Fund (Advisors) Module which all fund distributors or intermediaries and Mutual Fund employees engaged in selling and marketing of mutual fund schemes will be required to take.
BSE Training Institute (BTI), The Stock Exchange, Mumbai offers certification tests and training programmes.
Economics and Commerce postgraduates, CFAs, MBAs in Finance, Chartered Accountants, Cost and Works Accountants, Company Secretaries and allied professionals may pursue stock market careers. They may or may not require certification as mentioned above depending upon the nature of their responsibilities.
Prospects

Placement opportunities are with brokerage firms, banks, primary dealers, large corporations, mutual funds, investment banks, credit rating agencies, stock and commodity exchanges, equity research firms, market regulators and other market intermediaries and institutions. Stockbrokers may also be self-employed.

Prospective employers include UTI Mutual Fund, SBI Capital Markets Limited, ABN AMRO Asset Management Company (I) Limited, Kotak Mahindra AMC, National Stock Exchange of India Ltd., Bombay Stock Exchange, National Commodity Derivatives Exchange Limited (NCDX), Information and Credit Rating Agency (ICRA) etc.

The future of stock market careers depends immediately and directly on the success of the economy. When the stock market is riding high, customers play the market and there are lots of opportunities. When the economy slows down, people get out of the market and brokers lose their commissions.