The stock market can be an exciting, fast-paced way to make money, or it can be scary, nerve-wracking, and intimidating. If you’re interested in getting involved with the stock market but unsure where to start, look no further!
This list of 7 fascinating careers involving the stock market will help you get your feet wet in finance and give you some options for success in this industry. The list includes an overview of each career and examples of people who successfully pursued these careers.
Financial Analyst
If you're interested in finance and want to be on the ground floor of stock movements, a career as a financial analyst might be for you. These professionals analyse trends and patterns in financial markets, companies, industries, and individual securities.
They may also evaluate company performance and offer predictions about future prospects. The job requires excellent attention to detail, skill with numbers, and an ability to work under pressure. Most financial analysts work regular business hours in a professional office setting, but some night and weekend work is standard too.
Investment Banker
An investment banker negotiates to finance and provides services to help a company grow. This includes helping them find growth opportunities, identifying potential acquisitions or divestitures, and raising capital through bonds, stocks, or other securities.
Use this link to learn more about how they also advise companies on mergers and acquisitions. This is an impressive career with high salaries, but it does require an extensive resume and some training.
Forbes says that earlier in 2013, there were 137,000 job openings for people in this occupation, with a 6% expected growth by 2020. Interestingly, the growth trajectory is still headed north post-2020.
As an Investment Banker, you may need the following:
- University degree from a top-tier university in finance, economics, mathematics, or business
- Training from business school
- Extensive knowledge of financial markets
- Comprehensive understanding of foreign exchanges
Hedge Fund Manager
The Hedge Fund Manager is a fascinating career path because of its ties to the stock market. This is a high-risk, high-reward job with an expectation of a four-year college degree. The Hedge Fund Manager buys and sells securities using capital from wealthy individuals and institutions to generate high investment returns.
It's estimated that only 10% of hedge funds will survive during any given year because they are volatile. However, on average, most do very well when factoring in compound annual return and duration. These financial professionals must also be excellent at risk management and making intelligent trades.
Private Equity Investor
Private equity firms are typically limited partners in more considerable funds raised by hedge funds and pension funds. They will look for potential acquisitions and then do due diligence on them before deciding whether or not they want to invest.
The career of a private equity investor can be very lucrative because they usually get a percentage of profits and a share of the company that was acquired. The downside is that it can take quite some time for these investments to pay off, so many people only last 2-3 years before deciding it's too stressful.
Venture Capitalist
A venture capitalist is a professional investor who takes on high-risk, high-reward investments in startup companies. Venture capitalists come from various backgrounds and are not required to have any particular educational experience.
These professionals typically work with an early-stage company for two to three years and provide funding, guidance, and expertise in exchange for an ownership stake in the company. If venture capitalists see potential in a fledgling company, they may provide funding as significant as $1 million.
They also help the company find investors, advisers, and partners.
The risk is high but so too is the reward – if all goes well, then a venture capitalist can expect returns of 10x to 100x their initial investment!
Research Analyst
A research analyst gathers information from various sources, including company reports, industry trends, and analysts’ opinions. Based on their findings, they then look for ways to predict a company's future and what might happen to its share price.
Research analysts typically work in one of three sectors: sell-side, buy-side, or independent research. Sell-side research is when a research analyst works for an investment bank that sells stocks and bonds to investors.
Buy-side research is when a research analyst works for hedge funds or mutual funds and uses their predictions to make investments. Independent researchers do not work with either buy-side or sell-side firms. They provide stock analysis to individual investors, pension funds, and other private entities.
Stockbroker
One of the more common careers involved in finance is a stockbroker. A stockbroker earns commissions by buying and selling stocks and other securities on behalf of clients. If a broker buys and sells supplies for themselves, they are known as a market maker.
Trader: The trader buys or sells stocks on their account using their funds (not those of their employer), typically involving stop-loss orders. Another example would be an arbitrageur who takes advantage of price differences between markets or trading opportunities, such as unusually high prices in one place and low prices elsewhere, simultaneously buying from one and selling at another with no risk-taking because he's using his own money to do so.
Conclusion
The finance industry is one of the fastest-growing industries in America. There are many careers to choose from, and if you are interested in investing or trading stocks, you're lucky because there are plenty of jobs that would be a perfect fit for you.
