Stock trading tends to invoke strong impressions. Some imagine stock traders as high-roller, fast-living types who drive Ferraris and thrive on pressure. To others, stock trading is a fool's errand that attracts compulsive gamblers and ne'er-do-wells. The truth is, the salary, the success and the lifestyle of a stock trader widely vary based both on the individual and on the type of firm he works for.
Stock traders, whether they are independent or work for a financial services firm, usually do not have fixed salaries. Income for most traders usually comes in the form of performance bonuses and commissions. How much they make then largely depends on how successful they are in the markets or how many sales they make. According to Search By Degree, professional stock traders working for banks and other institutions earned roughly £26,000 their first year and those in the top 10 per cent earned £94,250 or more, as of 2010. According to the Bureau of Labor Statistics, the average salary as of May 2008 was £44,642.
Stock trading can be a stressful career choice. Most people have seen news footage or films highlighting the hustle and bustle of the trading floors. Floor traders make up only a small percentage of professional stock traders, but most traders work under a great deal of pressure.
Qualifications and Training
Education and experience requirements vary widely in the investment industry. Wall Street firms usually require business degrees and even MBAs. Many financial services companies hire people for sales-oriented positions that require state and federal stock broker licensing but don't necessarily have degree or experience requirements. People hired for these positions are usually provided sales and product training from the firm that hires them.
Professional traders and stock brokers are generally required to be licensed by both their state and the federal government. Most traders are required to maintain a National Association of Securities Dealers (NASD) Series 7 license. In addition, many firms require their employees to receive Series 63 and 65 licenses, which prove they are knowledgeable about state law and regulations as they pertain to securities trading.
Skill sets required for stock traders vary depending on the job type. Floor traders on the New York Stock Exchange require a different set of skills than a stock broker selling retirement plan packages to clients in middle America. Floor traders should be quick with numbers, good at multitasking and work well under pressure. Sales-oriented traders should have good people skills and be self-motivated.
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