How to Become a Stock Promoter

Study the SEC and FINRA rules and regulations. A stock promoter's top priority is to comply with these requirements. You don't actually need any certifications or licenses to promote your stock-picking talent and work as a stock promoter, but if you fail to maintain perfect compliance, you not only risk legal action against you and your employees, but against your client companies, their stocks and their shareholders, as well. Your client company will be held at least partially responsible for your misdeeds, and may risk being ejected from the exchange where it is trading. In addition, the market will drive the stock price down.
Find a good attorney who specializes in securities law. You will need contracts covering your services to client companies; legal disclosures for your website, newsletters and other promotional materials; legal disclaimers and some tutoring regarding what to expect and what not to do.
Develop your investor contact database by purchasing mailing lists of investors and writing and promoting a stock-picking newsletter. You can't sell stock to your readers, but their purchases will make the stock price rise. The value of a stock promoter lies in his ability to promote a client company's stock to large numbers of investors and stockbrokers, who trust the promoter enough to buy positions in most -- if not all -- that promoter's recommended stocks. Your database should contain at least a few hundred thousand names.
Develop your following by demonstrating your skill at picking high-flying stocks through your newsletter and special subscribers to your stock-picking premium service. Developing a following can be accomplished via Internet and social media marketing.
Research public companies to find those that appear to have under-priced stock. Generally, company management is anxious to publicize the value of the company, partially because their stockholders will stop complaining that the stock is not appreciating in value. These companies are your potential clients.
Tell prospective client companies how many investors and stockbrokers follow your recommendations, how careful you are about compliance issues and how high you expect their stock to trade based on your recommendations. If you live up to your promises, your client company will be happy, and you will find it easy to get more companies to hire your services.
Join the National Investor Relations Institute and the National Investment Banking Association, and attend as many of their educational programs and conventions as you can. Network in your local venture capital community to develop potential company clients and deep-pocketed investors for your database.

How to Hypothecate Common Stock

Apply with a brokerage firm to open a margin account. Because you will have borrowing privileges, this is like opening other credit accounts. You'll need a good credit score and a statement of your net worth and income. Under federal regulations, if you work for a firm that handles securities, you must also have your employer's written permission.
Read the hypothecation agreement carefully before you sign it. Under federal law and New York Stock Exchange rules, your broker must require that you put up a minimum amount (called the margin requirement) anytime you borrow money for a transaction and keep a minimum equity (called the maintenance requirement) while holding any margined security. However, brokers are free to impose stricter standards, so don't assume the hypothecation agreement requires only the legal minimums. Sign the hypothecation agreement once you understand the terms.
Deposit the required cash minimum to complete opening your margin account. Typically initial deposits must be two to three times as large as those required for regular cash brokerage accounts, and as much as 10 times more than that for day trading accounts. For example, if the minimum for a cash account is $1000, expect a margin account minimum to be around $2500, and $25,000 for day trading.
Understand your obligations when you hypothecate common stock. You are agreeing that any common stock or other cash and securities in the account are collateral for the money you borrow. If the market goes against you, you will get a margin call from your broker. At that point you must add enough cash to the account to bring it up to margin requirements or your broker is required to sell any securities in the account needed to recover the money you have borrowed.