People pay advisors to pick stocks for them etc, some seem to do well. So essentially the advisor becomes their hedge fund manager taking a cut.
That generally isn't what financial advisors do (no doubt there are exceptions). If you've got questions about pensions etc.. then your local IFA might well be the right person to go to, likewise you can get *some* investment advice but it will tend to be along the lines of older person, wanting to conserve capital, here are some safe funds to invest in... younger person happy to take some risk, well lets look at including some riskier funds in the portfolio... and that's about it.
It's generally not going to get analysis of individual stocks, hot tips along the lines of "blue horseshoe loves anacott steel".
You're perhaps confusing financial advisors with stock brokers - *some* stock brokerage firms offer advisory services and some will offer discretionary services too, in the latter case this might involve a set annual fee for them to simply manage your entire portfolio in line with some general guidelines whereby they've taken into account your risk profile, discussed with you what you're seeking to achieve etc.. In the former case this could involve paying a higher commission that you'd get at a discount brokerage that doesn't provide any advice... and is an area open to some real cowboy outfits - especially where CFDs and small cap stocks are concerned.
Arguably these stockbroking services can be of questionable value at times but if you've got a big portfolio and you're with some well established firm and simply paying a flat fee then meh, you're probably not going to go too far wrong. At the other end of the spectrum some firms seem to have built their entire business model around churning your account.
Just remember both private client stock brokers and IFAs are a kind of hybrid between some sales and some consulting, in some cases they can be much more on the sales side unless you're worth a lot of money. It doesn't necessarily take much to become one beyond passing some quite basic exams (in the case of stockbrokers, I've passed those same exams myself, as have many people in any regulated role in the city - the then SII certificates in security and derivatives, there was a financial regs paper that needed to be passed for both too - these were level 3 quals at the time, equivalent to A-levels and just involved turning up to a test centre and doing a multiple guess exam... I believe these days the qualifications are level 4 - equivalent to modules you might take at 1st year in university - not exactly all that challenging. Some may have the CFA too which changes things a bit and is much more of a challenge (albeith mostly in rote learning as it's more the quantity of material than complexity of it but props to them as going by the experience of some friends who took it it is quite a slog and they did give up much of their social lives for 3 years).
The guy in the office on the high street above the fish and chip shop is not some equivalent to a succesfull hedge fund manager, he might well be a very nice guy and might know UK pension regs inside and out (and by all means go seem him for that or life assurance policies or some investments in funds that only IFAs have access too etc..) but don't expect Gordon Gekko!
See also people who think - "ooh stock investments, I'll run this past my accountant" (as if the guy with ATT or ACCA exams is going to give you sound advice on individual equities while doing your accounts for your ltd company).
Does anyone use one or do you pick your own stocks, do your own investing, I'd imagine a good picker could make a fortune. Are city analysts allowed to set themselves up like this on the side while still working in the city?
Depends what you mean... if someone was really good then why aren't they managing a fund? They can indeed make a fortune doing that, likewise they can do rather well with their own investments too. If you work in the city though there may be some restrictions on what you can and can't do with a personal account - might need to leave individual equities alone for example.
In terms of being a successful stock broker - that's got little to do with being a good stock picker, obviously it's not a good idea to do anything silly and lose your clients money either if you want to survive as one. Successful stockbrokers are people who earn lots of their firm - via commissions or annual fees from big clients etc..They achieve that by being good salesman, networking and bringing in new accounts to the firm and/or keeping hold of any accounts that they already brought in or that might have been passed onto them if/when other brokers retire etc.. (example I know someone who's dad was a broker and he's now a broker too - guess where most of his dad's old accounts went - granted he was already quite experienced at that time and the clients knew him too etc..).
It's got little to do with being some stock picking savant, it's about contacts, relationships, perceptions etc..
