Securities traders purchase and sell securities such as stocks, bonds and shares on their own account or on their employers account based on their expertise in the financial markets. They monitor the performance of the securities traded, assessing their stability or speculative tendancies. Securities brokers calculate the securities price and place orders. They record and file all securities transactions and take care of their financial documents.
The following job titles also refer to securities trader:
securities sales agent
securities sales directors
securities sales director
securities sales agents
Professional securities traders typically need a bachelor’s degree in finance, or something similar like accounting or economics. Especially for securities traders working for large firms, having a master’s of business administration (MBA) may be necessary for progression up the corporate ladder.
Securities traders must be licensed to practice their profession. The requirements for the license vary based on the location where the position, but in general, it always involves passing an exam.
ISCO skill level
ISCO skill level is defined as a function of the complexity and range of tasks and duties to be performed in an occupation. It is measured on a scale from 1 to 4, with 1 the lowest level and 4 the highest, by considering:
- the nature of the work performed in an occupation in relation to the characteristic tasks and duties
- the level of formal education required for competent performance of the tasks and duties involved and
- the amount of informal on-the-job training and/or previous experience in a related occupation required for competent performance of these tasks and duties.
Securities trader is a Skill level 3 occupation.
Securities trader career path
These occupations, although different, require a lot of knowledge and skills similar to securities trader.
Long term prospects
These occupations require some skills and knowledge of securities trader. They also require other skills and knowledge, but at a higher ISCO skill level, meaning these occupations are accessible from a position of securities trader with a significant experience and/or extensive training.
Essential knowledge and skills
This knowledge should be acquired through learning to fulfill the role of securities trader.
- Securities: The financial instruments traded in financial markets representing both the right of property over the owner and at the same time, the obligation of payment over the issuer. The aim of securities which is raising capital and hedging risk in financial markets.
- Economics: Economic principles and practices, financial and commodity markets, banking and the analysis of financial data.
- Financial markets: The financial infrastructure which permits trading securities offered by companies and individuals govern by regulatory financial frameworks.
- Stock market: The market in which shares of publicly held companies are issued and traded.
- Modern portfolio theory: The theory of finance that attempts to either maximise the profit of an investment equivalent to the risk taken or to reduce the risk for the expected profit of an investment by judiciously choosing the right combination of financial products.
- Actuarial science: The rules of applying mathematical and statistical techniques to determine potential or existing risks in various industries, such as finance or insurance.
- Financial jurisdiction: Financial rules and procedures applicable to a certain location, whose regulatory bodies decide on its jurisdiction
Essential skills and competences
These skills are necessary for the role of securities trader.
- Communicate with customers: Respond to and communicate with customers in the most efficient and appropriate manner to enable them to access the desired products or services, or any other help they may require.
- Analyse market financial trends: Monitor and forecast the tendencies of a financial market to move in a particular direction over time.
- Perform financial market business: Perform or monitor business operations on the money market and on the capital market such as the lending or receiving of deposits, swap transactions or short selling.
- Analyse economic trends: Analyse developments in national or international trade, business relations, banking, and developments in public finance and how these factors interact with one another in a given economic context.
- Write work-related reports: Compose work-related reports that support effective relationship management and a high standard of documentation and record keeping. Write and present results and conclusions in a clear and intelligible way so they are comprehensible to a non-expert audience.
- Monitor stock market: Observe and analyse the stock market and its trends on a daily basis to gather up-to-date information in order to develop investment strategies.
- Offer financial services: Provide a broad range of financial services to clients such as assistance with financial products, financial planning, insurances, money and investment management.
- Forecast economic trends: Gather and analyse economic data in order to predict economic trends and events.
- Handle financial transactions: Administer currencies, financial exchange activities, deposits as well as company and voucher payments. Prepare and manage guest accounts and take payments by cash, credit card and debit card.
Optional knowledge and skills
This knowledge is sometimes, but not always, required for the role of securities trader. However, mastering this knowledge allows you to have more opportunities for career development.
- Financial products: The different types of instruments that apply to the management of cash flow that are available on the market, such as shares, bonds, options or funds.
- Banking activities: The broad and continuously growing banking activities and financial products managed by banks ranging from personal banking, corporate banking, investment banking, private banking, up to insurance, foreign exchange trading, commodity trading, trading in equities, futures and options trading.
- Statistics: The study of statistical theory, methods and practices such as collection, organisation, analysis, interpretation and presentation of data. It deals with all aspects of data including the planning of data collection in terms of the design of surveys and experiments in order to forecast and plan work-related activities.
- Accounting techniques: The techniques of recording and summarising business and financial transactions and analysing, verifying, and reporting the results.
- Investment analysis: The methods and tools for analysis of an investment compared to its potential return. Identification and calculation of profitability ratio and financial indicators in relation to associated risks to guide decision on investment.
- Office software: The characteristics and functioning of software programs for office tasks such as word processing, spreadsheets, presentation, email and database.
- Tax legislation: Tax legislation applicable to a specific area of specialisation, such as import tax, government tax, etc.
Optional skills and competences
These skills and competences are sometimes, but not always, required for the role of securities trader. However, mastering these skills and competences allows you to have more opportunities for career development.
- Trace financial transactions: Observe, track and analyse financial transactions made in companies or in banks. Determine the validity of the transaction and check for suspicious or high-risk transactions in order to avoid mismanagement.
- Make investment decisions: Determine whether to buy or sell financial products such as fonds, bonds or stocks in order to enhance profitability and to reach the best performance.
- Perform stock valuation: Analyse, calculate and appraise the value of the stock of a company. Use mathematic and logarithm in order to determine the value in consideration of different variables.
- Develop investment portfolio: Create an investment portfolio for a customer that includes an insurance policy or multiple policies to cover specific risks, such as financial risks, assistance, reinsurance, industrial risks or natural and technical disasters.
- Review investment portfolios: Meet with clients to review or update an investment portfolio and provide financial advice on investments.
- Create a financial plan: Develop a financial plan according to financial and client regulations, including an investor profile, financial advice, and negotiation and transaction plans.
- Advise on investment: Assess the customer’s economic goals and advise on the possible financial investments or capital investments to promote wealth creation or safeguarding.
- Interpret financial statements: Read, understand, and interpret the key lines and indicators in financial statements. Extract the most important information from financial statements depending on the needs and integrate this information in the development of the department’s plans.
- Maintain records of financial transactions: Collate all the financial transactions done in the daily operations of a business and record them in their respective accounts.
- Examine credit ratings: Investigate and look for information on the creditworthiness of companies and corporations, provided by credit rating agencies in order to determine the likelihood of default by the debtor.
- Obtain financial information: Gather information on securities, market conditions, governmental regulations and the financial situation, goals and needs of clients or companies.
- Advise on financial matters: Consult, advise, and propose solutions with regards to financial management such as acquiring new assets, incurring in investments, and tax efficiency methods.
- Trade securities: Buy or sell tradable financial products such as equity and debt securities on your own account or on behalf of a private customer, corporate customer or credit institution.
- Provide financial product information: Give the customer or client information about financial products, the financial market, insurances, loans or other types of financial data.
- Analyse financial risk: Identify and analyse risks that could impact an organisation or individual financially, such as credit and market risks, and propose solutions to cover against those risks.
ISCO group and title
3311 – Securities and finance dealers and brokers