Selling Financial Instruments are Among the Most Potentially Rewarding Careers Today

Selling Financial Instruments are Among the Most Potentially Rewarding Careers Today

Financial instruments are legal agreements that require one party to pay money or something else of value or to promise to pay under stipulated conditions to a counter party in exchange for the payment of interest, for the acquisition of rights, for premiums, or for indemnification against risk. In exchange for the payment of the money, the counter party hopes to profit by receiving interest, capital gains, premiums, or indemnification for a loss event.

Selling financial instruments are among the most potentially rewarding careers today. The field is extremely challenging, and many aspiring financial salespeople never find their niches and wash out. But successful financial product salespeople have practically unlimited income potential, lucrative residual income and tremendous personal freedom. Many of them take great satisfaction in helping people achieve their financial goals.

There are, however, some steps you have to take before Selling financial instruments.

•    Obtain an insurance license. The insurance industry is regulated at the state
•    Get appointed with one or more insurance companies doing business in your state
•    Take the Series 6 Exam.
•    Obtain the Series 7 license.

Selling financial instruments can be an actual document, such as a stock certificate or a loan contract, but, increasingly, financial instruments that have been standardized are stored in an electronic book-entry system as a record, and the parties to the contract are also recorded. For instance, United States Treasuries are stored electronically in a book-entry system maintained by the Federal Reserve.

Some common financial instruments include checks, which transfer money from the payer, the writer of the check, to the payee, the receiver of the check. Stocks are issued by companies to raise money from investors. The investors pay for the stock, thereby giving money to the company, in exchange for an ownership interest in the company. Bonds are financial instruments that allow investors to lend money to the bond issuer for a stipulated amount of interest over a specified period.

For instance, if a speculator thought that the price of XYZ stock was going to go up, then he could buy a call option for the stock, which would be profitable if the stock does go up. If the option expires worthless, then the loss to the speculator is less than the loss that would have been incurred from actually owning the stock. Hedgers attempt to mitigate financial risk by buying or selling the financial instruments whose value would vary inversely with the hedged risk. For instance, if the owner of XYZ stock feared that the price might go down, but didn't want to sell before a specific time for tax purposes, then she could buy a put on the stock that would increase in value as the stock declined in value. If the stock goes up, then the put expires worthless, but the loss of the put premium would probably be less than the loss incurred if the stock declined.