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MuffinMonarch's avatar

How can I become a stock trader?

Asked by MuffinMonarch (148 points ) May 24th, 2011

I just graduated from college with a degree in Finance and am enrolled in the Certified Financial Analyst (CFA) level 1 exam.

I want to be a trader (I like equities and emerging markets) but whenever I look it up on company websites, the jobs are never available or the deadline has passed.

How else can I find out about opening or get my foot in the door? Is starting in something much different (financial advising) and then moving over a good rout? Going to graduate school then trying?

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7 Answers

lawkes's avatar

Out of all the traders out there, only 10% are successful. So, I would recommend that you start trading on your own and build a good track record. If you can show consistent earnings over a few months time, that would shine nicely on your resume.

What you can also try to do is something called propriety trading. This is a bit safer then trading on your own. These are firms that take anybody in and provide you with intelligent risk management, multiple trading platforms, trade with profitable traders, dynamic trading floor, remote trading capabilities, advanced execution strategy. In return for all this, they take commission from your earnings. If you’re good enough, then they hire you, and now you get a salary, bonuses, etc… all in addition to your own earnings.

zenvelo's avatar

First off, trading is different from financial planning or account management. Trading is moment to moment.

Trading on a desk involves a good understanding of how the markets actually work. That experience comes best from working for order handling firms that can teach you. The initial pay is low until you actually start trading, but it’s part of your education.

Look on exchange websites for the names of member firms; then look at the firm websites and send them your resume. Avoid firms you have heard of (like Merrill Lynch), you want smaller firms that will take a chance on you.

lawkes's avatar

Here are some examples of proprietary trading firms.

StarAllianceCapital

BroadStreetTrading

AvatarSecurities

If you decide to trade on your own, what you can also do is paper trade, prior to investing real capital. You basically open up an account, fund it with a couple of hundred bucks to remove the 20 minute delay and allow real time quotes, and you basically get a free trading platform to practice on. Everything is real, accept the money. You get 100,000 of this fake money and you can reset it as much as you want. This online brokerage firm is famous for their paper trading platform. ThinkorSwim

plethora's avatar

I have been in and around financial businesses for 37 years and have never met a successful long term trader. At the very very least, it is a highly speculative venture and you should have a huge amount of personal money to lose to pay for your mistakes.

A better way is to go to work for a firm where you can meet people in the industry and get some feel for others who do this.

What do you even know first hand about this business? Sounds like nothing at all.

Your objective at this stage is to go to work for a company and establish a good track record, then move on with good references.

As for getting a job, forget the internet and other postings. Go see the PERSON who is doing the hiring….NOT H.R.

MuffinMonarch's avatar

These have all been great answer, and I thank everyone who posted.

@plethora I was hoping to start in a firm until I learn the ropes like you were saying. How would I go about finding the guys who do the hiring? I’m willing to do anything to get into the business I just don’t know what steps I need to take.

Also, what would be some good positions in finance that will give me a better look at how the markets work and are affected to help with my future trading plans? Analysts or some sort of risk based position?

MuffinMonarch's avatar

Also, any ideas how I can get into brokering? Seems like a good way to get into the business if your willing to bust your butt.

plethora's avatar

@MuffinMonarch The stock brokerage business will teach you how to sell. Period. That is all they teach. IBM will do a much better job of teaching you how to sell. Ive been there.

Are you a college graduate? Do you have an MBA? Unless you have your own fortune to lose, don’t even think about being in the business unless you have these two from very good schools. You want to know how to meet the people you want to meet? Go to college and grad school with them….at the good schools.

If you are thinking about starting with your own whimsical ideas of how things work, I would suggest that you first learn how life works and how to meet the people you need to meet. Start with good schools, talk to your professors, talk to your classmates, talk to those just a few years older than you who are doing what you think you want to do. If you dont know those people, then the first thing to do is meet them.

Go to good schools and then get jobs at good firms and don’t be interviewed by those firms. You do the interviewing. If you are going to a good graduate school, then you will have many opportunities to interview for jobs you may like….or not. At least you’ll learn the difference.

Oops, just checked your question. You have graduated from college. Go to graduate school. Forget the CFA until during or after graduate school. In this business, you are nothing without at least an MBA

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