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What Are the Different Types of Investment Qualifications?

K. Kinsella
K. Kinsella

People who work as brokers, traders and sales representatives for financial firms normally possess investment qualifications that may include various types of licenses and certain academic credentials. In many countries, securities laws prevent non-licensed individuals from working for investment firms while finance related degrees are among the investment qualifications that are desired, and sometimes required, by employers. Additionally, most employers also require applicants for broker and trading positions to have some prior sales experience.

Regulatory authorities in many countries administer several different types of securities licensing examinations and people who successfully pass the most basic of these examinations receive a license that enables them to sell shares in mutual funds. Licensed sales representatives normally have to pass a second and more complex examination before they receive a license to sell individual stocks and bonds. In some countries, these licenses are issued at the national level while in other instances regional government agencies oversee the licensing process. Consequently, regional and national licences are usually included among the investment qualifications that applicants for broker positions must possess.

Woman holding a book
Woman holding a book

Traders and other investment firm employees are responsible for conducting transactions on behalf of their employers and outside clients. These transactions often involve significant sums of money and many firms prefer to employ individuals with accounting or finance degrees to fill these jobs. Aside from undergraduate degrees, some financial firms attempt to recruit people who have postgraduate degrees in financial accounting, financial regulation or securities-related topics.

Investment firms generate revenue by marketing securities to individuals and institutional investors. Therefore, the brokers who solicit sales must possess good sales and customer service skills. Some firms prefer to hire individuals who have prior experience selling financial products such as loans, credit cards or deposit accounts. These individuals must successfully pass securities licensing classes before they can begin working as brokers.

In many nations, insurance contracts are among the marketable securities that can be traded on stock exchanges. Laws in many places prevent anyone other than licensed insurance agents from selling or marketing these policies. Insurance licenses are among the investment qualifications that financial firms often require applicants for trading or broker positions to possess.

Aside from employing individuals to market securities, financial firms also employ in-house auditors and attorneys as compliance officers and these individuals are responsible for ensuring that company employees do not violate securities laws. Auditors employed by investment firms normally have to be certified accountants while lawyers must have graduated law school and be licensed to work as attorneys. Many employers prefer to hire attorneys and accountants whose qualifications include prior securities related experience.

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