Top Tips To Become a Currency Trader
Within the financial sector, currency trading – or foreign exchange trading – is one of the largest commodities markets. It’s fast-paced, volatile and dynamic. Not only this, but it is one of the most profitable, especially if you have what it takes.
If you’re patient, good with numbers and extremely diligent – its a career for you. Use these top tips on how you can become a currency trader.
Before making any career choices, do your research. It will give you a clear idea of the downsides of the profession, as well as the positives.
The Job Description:
In a nutshell, currency traders focus on the foreign exchange market- otherwise known as the Forex market- and execute trades based on the performance of two types of currency against each other. The basic concept is simple, sell for a higher price than you paid. Understanding the political and socio-economic factors behind market shifts are what separates profitable traders from the rest. There is a significant number of amateur and part-time roles in the market, looking to supplement their income or trade for fun. The day to day responsibilities may include;
- Identifying and executing potentially profitable trades,
- Developing and adhering to responsible trading strategies that minimise loss,
- Research marketing conditions- being aware of any external factors that may affect currency rates,
- Meeting profitability targets,
- Building positive relationships with brokers.
Whilst you can become a Forex trader with various education and experience, it’s important to have the following qualities:
- Patience – you need to show patience and discipline, as when things are slow you can easily make a rash decision which will lead to a poor trade.
- Diligence – profitable traders don’t just buy and sell on a whim, they look at every possible angle and weigh up their options.
- Attention to detail – spotting something in the charts that others may have missed or picking up on an obscure news story that could have far-reaching consequences.
- Research – If you want to understand why a certain currency is on the way up or down, you should be able to conduct effective and reliable research to give you a competitive edge.
- Numerical skills – this might seem obvious, but your trading career will be much easier if you have a grasp of numbers, including making quick calculations.
- Awareness – global awareness is important, currency peaks and troughs are a direct result of political actions or socio-economic circumstances; keeping on top of developments relevant to your chosen currencies and, more importantly, understanding how they might have an effect, is a highly useful skill.
Flexibility is one of the most appealing aspects of the career, depending on your circumstances, you can work as little or as much as you like. If you are employed by a bank or investment firm, you will likely work shifts in the company offices. Depending on the regional market that you’re operating in, this can entail night shifts and weekends. If you’re in London, but trade in Hong Kong, expect plenty of night shifts to reflect the opening hours of that market.
If you decide to not trade on behalf of a company, you can be much more flexible. Forex can be accessed entirely online, with knowledge and access to a trading platform, you can work from home or execute trades while travelling. Finally, casual participants trade part-time, either before or after work. Semi-automated software programs and platforms make it easier to adopt this low-risk, low-reward approach, with many simply trading for the thrill.
Financial markets play a key role within global economies, meaning that there will always be jobs within the sector and currencies to trade.
Obviously, the earnings for currency traders are dependent upon how successful they are and how well they perform, and how you choose to work. If you’re employed by a bank or an investment firm, then you’ll receive a starting salary of between £26,000 ($33,800) and £32,000 ($41,600), although with experience this can grow to anything from £45,000 ($58,500) to more than £150,000 ($195,000), depending on performance. (Career Addict,2019) Bonuses and commission is also something to consider when thinking about salary.
In most jurisdictions, you do not need a permit or licence in which to trade. Although knowledge of how Forex and general markets operate is essential, many traders do not possess formal education such as a degree in this area, it is important to look online to find a good course if you’re looking to start out in trading. At FX Career Swap we offer a variety of courses dependent on your skill level, have a look at what we can offer you. This is a great way to get started and we can offer professional advice and insight as well as interactive webinars to ensure you’re starting off on the right foot.
Your First Job:
Landing a job at a top investment firm isn’t easy. However, if you have the right qualifications and skills and you are prepared to put in long hours, it’s not impossible. Just make sure you research internships and graduate schemes at the big players. If you have experience as an independent trader, your qualifications may not matter, you could take a look at our advanced and experienced trading courses to build your skills.
How far you go in your currency trading career is down to your own motivation. If you wish to work for an investment organisation, then there is the scope to progress beyond the trading floor and into executive management or strategy. As you develop contacts, other career opportunities may come about.
Once you have established a reputation and a consistently healthy profit margin, you might also be approached by investors to trade on their behalf. If this is the case, then starting your own company can be an appealing prospect from a workload management perspective, and you’ll get to play the market on your own terms. It could be a great opportunity to switch up your 9-5 life and learn new skills.
It is up to you how far you go with Forex trading, it’s a complex thing to learn, but the rewards can be life-changing, read Patrick’s story to learn more about the incredible benefits trading can bring to your life.