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How Do I Become a Desk Trader?

By K. Kinsella
Updated May 17, 2024
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A desk trader accepts securities trade orders from a client or investment representatives and relays details of those trades to brokers who actually conduct securities transactions in regional stock markets. Someone wishing to become a desk trader must successfully complete a securities licensing examination. Additionally, desk traders must have demonstrated administrative and customer service skills. Some firms prefer to hire traders who have completed college degree programs, as well.

Unlike brokers, desk traders cannot make investment decisions on behalf of a financial firm and in most instances, traders can accept orders but cannot provide clients with trading advice. Stock prices fluctuate throughout the course of the day and a processing error could result in a financial loss for a client or the trader's employer. Therefore, someone wishing to become a desk trader must have the ability to multi-task and enter data into trading systems without making errors. Many investment firms prefer to hire individuals who have prior banking industry experience; some traders have experience working in call centers for sales or marketing firms. Traders use computer networks on a daily basis so individuals who lack computing skills may have to enroll in short-term training courses that are offered by community colleges.

In most nations, the securities industry is heavily regulated and traders like brokers must pass licensing examinations. Typically, prospective traders attend a series of training classes during which candidates are taught about securities trades and regulations. Class attendees must archive a certain score on the examination in order to become licensed traders. Someone wishing to become a desk trader may be given more than one opportunity to pass the licensing examination although some nations have laws that limit the number of times an individual can take this exam. In many instances, traders also have to obtain insurance licenses since various types of insurance policies are traded on stock markets around the world.

Since traders handle large sums of money, many financial firms prefer to hire individuals who have completed undergraduate degrees in accounting, finance, mathematics or related topics. Firms with high trade volumes sometimes hire people who have completed postgraduate degree programs in finance since these individuals have the ability to quickly complete complex calculations. While some traders have many academic credentials, others are individuals who graduated from high school and began working for investment firms in entry-level jobs. Therefore, someone who wishes to become a desk trader may be able to gain work as a clerk or administrative assistant before eventually becoming licensed and transitioning into a trader role.

WiseGeek is dedicated to providing accurate and trustworthy information. We carefully select reputable sources and employ a rigorous fact-checking process to maintain the highest standards. To learn more about our commitment to accuracy, read our editorial process.
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