Careers in the capital markets

If you thrive in a fast-paced environment, the capital markets might be just the place for you. There are interesting jobs on offer for those who enjoy the excitement of watching huge sums of money transact every day.

Careers in the capital market are found mainly in the broking houses, asset management companies, unit trust management companies, investment banks, rating agencies, and in financial regulatory bodies such as Bank Negara and the Securities Commission (SC).

Stockbrokers

Stockbrokers are usually an extension of a banking group, and act as intermediaries through which traders of shares place their orders. They take delivery of the shares and make payments. Brokers also provide value-added services like investment research reports and recommendations to their clients.

Brokers normally have qualifications in business or finance. Besides that, they need to get a licence, which is obtained by passing certain examinations prepared by the SC. They are paid on a commission basis, therefore when the stock market is very active, and there is heavy trading, brokers can earn a very lucrative income.

Asset or fund management

Fund managers manage portfolios or funds of clients. This involves an asset allocation process, dividing the total investments between asset classes like stocks, bonds or cash. A successful fund manager is one who can assimilate information quickly and act on it. Sometimes, you would need to depend on intuition, therefore extensive experience in the industry usually helps.

Unit trust management companies are a subset of fund management companies. They pool funds from a large number of investors and reorganise them into units of certain sizes. Unit trust companies market their products through unit trust agents trained in the various products being offered. They must pass examinations set by and be registered with the Federation of Malaysian Unit Trust Managers (FMUTM).

Remuneration is commission-based. Those who enjoy meeting people and flexible working hours would enjoy this job.

Research/investment analysts

Research or investment analysts work in asset management companies or broking houses. They provide research reports on listed companies, the industries they are in and on the economic environment. This is done by studying local, regional and global events, financial and economic reports and networking with corporations to obtain new information. They also make growth projections and recommendations for investments to investors.

The minimum requirement to be an analyst is a degree in finance, investments or economics. A postgraduate qualification is also helpful, like the Chartered Financial Analyst (CFA) qualification, or a Master's in finance.

It is quite common in investment houses in more developed capital markets to include actuaries and even engineering or science graduates in their investment teams. This is in line with the growing complexities of various technologies employed in the many businesses or sectors they research.

Economists

Economists work in asset management companies, rating agencies (see below) and some stockbroking houses. They study and research the macro level of economics, which is on a national or global level, rather than industry or company level. This involves the analysis of the money supply, interest rates, inflation and overall confidence level of a country.

Economists must have a qualified degree in economics, as well as a postgraduate degree or qualification. They usually gain experience from working in commercial banks, investment banks or rating agencies.

Compliance officers

Compliance officers are responsible for ensuring that the licensed company complies with the relevant rules and regulations. He or she must hold a degree in law, finance or related fields, and must possess relevant work experience to deal with the board of directors, the internal audit department, and the heads of departments.

They must be knowledgeable about trading practices and daily operations of the company, and work closely with management in implementing policies and procedures for the good corporate governance of the company. Jobs in compliance can be found in firms such as the SC, the Companies Commission of Malaysia, or Bank Negara.

Investment bankers

Investment banks facilitate the issuance of shares and bonds by companies (issuers) that seek public funds. They evaluate the business and access whether the company is eligible for listing or issuing debt instruments to obtain funds, and advise the issuer on matters like the size of the funds to be raised.

They also help to identity the investors for the issuers, for example, pension funds or institutional funds. For most issues, the bank acts as the main or partial underwriter. They also give advice on mergers and acquisitions or other corporate restructuring exercises.

You would need a degree in business, finance or economics to work in an investment bank. Good networking skills are a must, as well as the ability to meet strict deadlines and perform under pressure.

Rating agencies

Rating agencies are institutions that access and grade the quality of debt instruments (bonds) issued by corporations. RAM (Rating Agency Malaysia) and MARC (Malaysian Rating Corporation) are two rating agencies in Malaysia, whereas Standard & Poor's is an international agency.

These agencies are independent and approved by the authorities to guard public interests by assigning independent grading of the bonds. Grades are assigned based on factors like the strength of the company's cash flow and quality of business, and its existing debt.

Rating agencies would employ credit and financial analysts to study these factors and how they affect the overall quality of debt issued by the company. Qualifications or experience in debt instruments and credit assessment are required for jobs in this area.

Economists and market analysts could find suitable jobs in rating agency firms as well.

Support staff

Besides all that, every financial company needs good support staff like accountants and marketing personnel. Accountants provide advice in the areas of financial control, budgeting and management costing.

Marketers would need qualifications in business, marketing or a related field. More importantly, you would need good communication skills, and a pleasant personality.

The capital market is an exciting albeit sometimes stressful arena to work in. However, the perks are aplenty if you are willing to work hard and hone your expertise. A good aptitude for numbers helps, as well as the ability to think and act quickly.

© GTI Specialist Publishers. Reproduced with permission.