Any financial advisors in the house?

[Von Milash]

What's your question so that all us morons can help

Is it a good career choice?

[Von Milash]

Lyle,

CC. In Canada we have various exams, as you've alluded to. The key exams for financial sales are insurance and the Canadian Securities Course (mutual funds). The mutual funds course, I could probably teach. And yes, most planners use low risk stuff..long term growth funds. The guys that can lose 100k in a day are usually active traders, and usually deal in commodities. With a stock, if it crashes, you can hold onto it hoping it'll bounce back. With commodities, which are dealt through futures contracts, if you hold a buy (long) position, and the price drops, you must put up the money at the end of the day. It's called marking to market.... where gains and losses are settled every day in a game of Wall Street over-under.

[Kirkland Laing]

Well, is it a good career? I wanted to get into the investment banking game ($$$), but I'd have to move to Toronto, which the wife and I don't want to do. So I'm considering taking a job with Investors Group as an advisor.

I'm almost finished an MBA in finance but I'm not sure if "sales," even if it is a high level sales position, is a good use of my skills. Right now I'm having trouble convincing companies to employ me before actually being finished the MBA, even though I've completed my finance courses.....

Any advice?

Trying to sell stock the company is trying to boost to the company's customers didn't used to be a degree level job. When I started working in the City of London at the end of the eighties it was a job they employed 18-year-olds to do. They were called "moneybrokers", but really were just telesales people. The problem is these days that everybody wants to go into investment banking and the securities industry in general so competition for even these jobs is fierce. I'm sure the churn rate is pretty phenomenal -- if you look at entry-level trading jobs, the top graduates from Ivy League colleges are now competing for these. More than three quarters of them won't make it through the first two years and the average career length for those who do is ten years, although that's dropping due to a combination of reasons.

If it's just a sales job, you want to try and find as much information as you can about your realistic career path in the firm before you take it. Even if you do make it up the greasy pole you're looking at an industry where 99% of employees don't make it to the jobs where you make the serious money. In a firm like Goldman for instance there are well over 10000 employees just in the US but less than 200 partners. The partners are the guys who make the serious money, plus the star traders who may or may not already be partners, so that's maybe 250 guys sharing 90% of the bonus -- so when you hear about the "average employee" making $650 000 due to record bonuses, think about mean versus average. If you go into a fancy hotel with an elevator attendant and get in with Bill gates, the average salary in the elevator is a billion dollars a year (plus tips.) If Bill gets out, the average salary drops somewhat.

Basically big firms exist to reward the talent at the top. To get to the very top may take you a decade or two, a marriage or two, your hair, heart issues, you name it. Good luck.

[Von Milash]

CC.

so kirk, what are your thoughts on Edward Jones? good company, good job?

[Kirkland Laing]

CC.

so kirk, what are your thoughts on Edward Jones? good company, good job?

I don't know anything about them other than what they do. As far as whether a company or a job is good, it all depends. Right now the financial industry is heading into the downswing of it's cycle, there are going to be huge numbers of layoffs in the next couple of years. The kind of job you're thinking about is going to be one of the first to go. If it's last in first out, you're goosed. There's going to be a limited market for sales of new products to existing customers in the middle of an economic slowdown/massive tightening of credit in the financial system. So the job is precarious. As for the company, it depends how exposed they are to however future losses play out as the credit situation worsens. Look at the recent issues at Merrill, look at Citigroup for how things can go tits-up overnight. Who knows what disasters might be tucked away on Edward Jones's balance sheet?

[El Kabong]

I have heard rumors that Merril Lynch is going to get bought out


Life Insurance is safer and easier to sell when the economy goes through it's ups and downs...it is more of a long term investment where stocks and so on are over night hit or miss (sometimes) investments

[Von Milash]

That's very true. But the credit crunch and subprime mess is not something we're currently experiencing in Canada just yet, hit wood. I've alse read on various career boards that financial planning is a hot area right now with the aging boomers. So I uess it depends where you are, who you ask, ect. Whatever the case may be, it seems ot be my only option rght now. Ideally, I'd do something similar in a bank, but they're not knocking on my door just yet. (Bastards!! I know more finance than they do!! you don't even need an mba inf finance to get in bank.)

Lyle,
the company I'm talking to (Investors Group) told me the first exam they'd have me write is for my insurance license. I guess planning and consulting encompasses all areas of the financial markets and institutions. In addition, you're right about companines and stocks going being cyclical. However, the markets will always have an upside bias, which enables you to earn greater retrns than mere deposit accounts. Even if you're only getting 5-7%, that's still better than the 2% the banks are giving, if they even give you that. The thing is... DIVERSIFY. If you choose stocks across various sectors/industries, and choose them such that their "betas" compliment each other, you can patially eliminate the broad movements of the market and earn a norma rate of return per unit of risk. This is exactly what mutual funds attempt to do.

[Von Milash]

ps, if you're looking to actually capitalize on those broad swings, you go long or short on index funds/futures. But it's riskier since you're speculating. I've actually done a lot of thinking and reading around the idea of day trading but I'd prefer the security of a job.