Stock markets offer immense opportunities to individuals who wish to enter the field of investment and finance. Sub broking is one such field that allows individuals to serve as certified representatives of stockbrokers, assist investors, and even earn commission for their services while being a part of the stock market business. But who are sub-brokers and what services do they deliver?
Sub-brokers serve as intermediaries between stock market brokers and investors. Working on a commission-based model, they connect stock market brokers with prospective investors. Moreover, they offer an extensive range of services to investors like assisting with stock-market investment, opening a demat account et cetera. However, they do not possess the power to execute trade on behalf of the investors. They only serve as a bridge between stock market brokers and investors delivering essential services.
How to become sub broker?
Becoming a broker requires understanding various aspects and obtaining a registration number and clearance certificate from SEBI and various registered authorities. Following are the step-by-step guidelines for becoming a sub-broker:
- Fulfilment of eligibility criteria
To become a sub-broker, an individual has to fulfill dedicated eligibility criteria. This includes a minimum qualification of 12th standard with finance or commerce as the main subjects. A minimum age of 18 and an understanding of the basic tools and terms associated with stock market investment are a must as well.
- Selection of a stockbroker
Sub-brokers must be associated with a registered stockbroker to deliver necessary services and earn a commission. A sub-broker must opt for research and select the stockbroker.
- Obtaining a registration number from SEBI and the Stock exchange
An individual must even obtain a registration number from SEBI and the stock exchange to become a legal sub-broker. Registration as an authorised person with SEBI and a stock exchange like NSE is a necessity. Various formalities have to be completed as well which include the submission of partnership applications with a registered stockbroker. Identity proofs, educational certificates, and payment of the registration fee are aspects that must be fulfilled for registration.
- Access to necessary resources
After completion of registration, sub-brokers must even possess access to essential resources like a computer system, an established office, and access to dedicated customer relationship software to manage their client base. A complete and functional infrastructure is a necessity to become a sub-broker and deliver services to both stockbrokers and individual investors.
- Delivering services to investors
After completion of all the necessary formalities concerned with registration, sub-brokers must create a client base consisting of investors and deliver various services like portfolio management and investment advice. They must even possess the knowledge of various tools necessary for stock market investment and delivering services to their clients.
Conclusion
Apart from all the dedicated steps mentioned aboveon how to become sub broker, they must continue to improve his knowledge and understanding of the stock market investment process and ever-changing market trends. Complete knowledge about investing, current rules and regulations of SEBI, and guidelines published by partner brokerage companies is a necessity. Sub-broking being a professional service requires completion of all the formalities concerned with the registration and continued comprehensive learning of various aspects for long-term success.
