CHOOSING A CAREER / SEP. 30, 2014
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How to Become a Commodities Trader in the US

Have you ever wondered what it takes to become a commodities trader? Commodities traders, also referred to as commodities brokers negotiate and organize the purchase or sale of raw products and physical products such as natural gas, coffee, electricity or livestock. This career is best for suited for individuals who are well aware of market conditions.

What Do Commodities Traders Do?

Commodities traders work in the financial market. Their duties include but are not limited to:

  • Agreeing on selling or purchasing prices at the optimal levels for various clients
  • Analyzing investment opportunities and target companies to form better investment decisions
  • Building or selling bonds, stocks, foreign currencies and even commodity futures on behalf of investors
  • Making offers or bids to sell or buy securities
  • Informing managers, customers and traders of market conditions such as competition, volume, price and dynamics
  • Developing channels or identifying opportunities for purchase or sale of commodities or securities
  • Hedging strategies or devising trading options
  • Developing and maintaining customer and supplier relations

Salary

Commodities traders take home an average of $95,000 per year.

 

 

Low end

 

High end

Annual salary

 

$72,000

 

$108,000

Source: Recruiter

Skills

As a commodities trader, you need to:

  • Be service oriented
  • Have strong communication skills
  • Have resilient judgment and decision making skills
  • Be analytical and have strong interpreting abilities
  • Be able to make sound decisions
  • Be able to work diligently to meet tight deadlines
  • Have strong mathematical and financial skills
  • Be good in conducting market research.

Qualifications

To become a commodities trader, you need to achieve at least a bachelor in any of the following specialties:

The above programs include important subjects such as international business, business finance, business administration, logistics and marketing. Some positions might also require you to have customer and sales service experience.

Individuals with a bachelor’s degree can consider pursuing a master’s degree this to advance their skill set and their prospects. Candidates who are after brokerage posts might find the master’s degree very beneficial. Those holding MBAs are also open to better compensation and large signing bonuses.

Many employers offer on-the-job training on the particular services and products they provide.  The training is intensive and they undergo rotation through various departments during their training to achieve a thorough understanding of the trade.

Most positions especially in the brokerage sector might require you to be licensed. Licensure from bodies such as FINRA are achieved upon passing a qualifying exam. The CFA Institute also provides a widely-recognized certification to competent commodities traders and can be completed while practicing in a full-time profession. With more experience and training, commodities traders can serve in higher positions such as training and management.

Career Prospects

Commodities traders are open to numerous job opportunities. According to the Bureau of Labor Statistics, job openings for these professionals are projected to increase by 11% between 2012 and 2022. This is due to an increase in the number of people who are taking part in trading activities. This career requires you to make realistic and reachable goals.

If you have excellent financial, arithmetic and negotiation skills, this career is perfect for you!

Image Source: Stocks on Wall Street

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