Traders work for investment management firms or banks to buy and sell orders for stocks, bonds, and commodities for clients (but make the actual trades on behalf of the firm itself).
Education and Qualifications
Traders need a bachelor’s degree; most choose business or some equivalent as their major. But there is no specific requirement. A strong finance, accounting, or economics foundation usually helps a lot. Though not required, many choose to get a master’s degree in business administration (MBA). One of the requirements for traders is to register as representatives of their firm with the Financial Industry Regulatory Authority (FINRA); they need to pass a series of exams to get the license.
Based on the type of investment, many traders choose to get licenses like Series 6, Series 7, Series 63, etc. Few choose to earn the Certified Financial Planner (CFP) credential; others pursue the Chartered Financial Analyst (CFA) certification. These certifications not only require passing an exam but also require a certain number of hours of experience. All these have continuing education and ongoing certifications as well.
Responsibilities and a Day in the Life
Most traders work long hours; they spend 10+ hours a day at work, five days a week. Like any other profession, hours can vary based on many factors.
Some of the daily responsibilities include the following:
- Researching and monitoring the market for trading opportunities
- Buying and selling securities on behalf of the investment firm
- Developing, evaluating, and implementing trading strategies to meet the firm’s objectives
- Working with analysts to improve trading strategies
- Recording trades and transactions
- Calculating and reporting profit and losses for that day
- Analyzing companies’ financial reports and other economic statistics to make trading decisions
- Staying on top of industry news and trends to predict potential changes in the market
- Complying with standards and regulatory requirements
- Offering investment advice to clients
- Meeting with existing clients to improve relationships
- Enhancing existing products and defining new products and marketing materials to attract new clients
- Hiring, training, and managing junior team members
Other Necessary Skills
- Strong analytical and problem-solving skills
- Excellent written and communication skills
- Listening skills
- Decision-making skills
- Attention to detail.
Salary
- As always, salary could vary based on company, experience, location, etc. According to BLS, the median salary is about $93K. Â
Job Growth
According to the U.S. Bureau of Labor Statistics, there were about,
- 467K jobs in 2021
- The job outlook from 2021 to 2031 is 10%, faster than the average job growth.
- Employment change 48K (2021 to 31)
Summary
If you are someone who finds the following characteristics appealing, you can consider being a trader as your future career:
- Strong business acumen
- Interest in working in a fast-paced environment
- Ability to work long hours under stress
- Self-motivated and functions well within a large team.
