How to Become a Stock Trader

Stock Trader Key Stats
Education	4+ Years
Job Outlook	6.2%

A Stock Trader is a professional who is experienced in increasing their client’s assets by trading a variety of stocks in the market.

Even though the most popular vision of a Stock Trader is one of an individual working on the stock exchange floor, the majority of these individuals work for security firms managing stocks.

Individuals who want to become a Stock Trader will need to have attention to detail and the ability to analyze financial information to make the right choices for their clients.

Stock Traders have a strong knowledge of how the stock market works and they use this knowledge to make smart moves to buy and sell certain stocks.

Education Requirements to Become a Stock Trader

Individuals who want to become a Stock Trader will need a minimum of a bachelor’s degree in order to enter this profession at the entry level.

Individuals who are seeking advancement opportunities will benefit from pursuing a graduate degree.

In addition, individuals who want to become a Stock Trader will also need to secure a license in order to enter this profession.

Individuals seeking a profession with a larger security firm will need to secure a bachelor’s degree focused on finances in order to seek an entry level position.

Some common courses of study include: economics, accounting, finance or business.

Individuals will benefit from securing an internship during their senior year of college in order to gain some on the job experience that will stand out to potential employers.

Individuals can seek internships at firms who typically seek interns during the summer.

In addition, individuals who would like to pursue advancement opportunities can do so by attaining a business graduate degree.

The most common type of degree is a master’s in business administration (MBA) which typically takes an additional two years to complete.

An MBA prepares individuals for the business world by presenting real world business scenarios and practices.

Whether an individual pursues a bachelor’s or a master’s degree, they will still need to seek a license in order to become a Stock Trader.

The Financial Industry Regulatory Authority (FINRA) is a nonprofit agency that administers the Series 7 and series 63 exams needed to become a Stock Trader.

The series 7 exam and license must be taken when an individual has approximately 4 months of experience working at a brokerage firm.

Depending on the state an individual resides in, they may also be required to attain a series 63 license.

Individuals may visit Series 63 to learn more information on the requirements needed to take the exam as well as some helpful resources to register and practice for the exam.

Stock Trader Job Description

Stock Traders work on behalf of their clients, corporations or individuals, to increase the value of their assets.

These professionals will buy and sell stocks or shares on behalf of their clients and will use a variety of financial information in order to increase the value.

Stock Traders will gather financial information that can benefit their clients.

Stock Traders will also meet with their clients to provide suggestions on how to invest in the stock market.

They will determine a client’s level of risk and use that information to place transactions with floor brokers, individuals working at the stock exchange.

Because this is a commissions based profession, Stock Traders will also spend time building their client base and expanding their referrals.

Stock Trader Salary and Career Path

In 2012, the median salary for securities, commodities and financial service sales agents, which includes the stock trader position, was approximately $71,720 per year.

Exact salary and wages will heavily depend on the size of the firm an individual works for, level of experience and the size of their commission.

The job outlook for securities, commodities and financial service sales agents, which also includes the stock trader position, is expected to grow by 11 percent through the year 2022.

This growth is considered an average growth when compared to other professions and is impacted by the consolidation occurring in the financial services industry.

However, this consolidation will have less of an impact on brokers and traders; this sector is actually expected to experience a growth due to the increase of retirement funds needing investing.

Individuals interested in a career as a Stock Trader can be assured that this is a challenging profession that requires individuals to analyze the ever changing stock market, work with their clients to make wise financial decisions and one with the benefit of seeing a salary that reflects the work one puts into it.

The below information is based on the 2023 BLS national averages.

• Annually
• Monthly
• Hourly

* Salary information based on the May 2023 Occupational Employment Statistics (OES) Survey for Financial and Investment Analysts, Financial Risk Specialists, and Financial Specialists, OCC Code 13-2098, BLS.
* Employment conditions in your area may vary.

Frequently Asked Questions

What does a stock trader do?

Stock traders do exactly what the name suggests and that is – buy and sell stocks.

However, stock traders can also sell and buy various financial instruments and work as a financial advisor or a money manager for their clients.

A specialist can work independently, for another individual or a company.

A stock trader would make a profit by taking advantage of various price fluctuations on stocks.

There are short-term trades that can last for only a few seconds and long-term trades that have a holding period of a few weeks.

The typical responsibilities of a stock trader usually include watching the market; managing monetary investments; buying and holding stocks; researching the stocks, and so on.

How much does a stock trader make?

On average, a stock trader can make a little more than $64.000 per year in the United States.

In case you decide to choose this career path, you can expect to earn anywhere between $34.000 and $135.000 annually.

The salary would certainly depend on a variety of factors – your education and experience level, the employer, the number of successful deals, the location, and so on.

The professionals that work in New York, Illinois, and South Dakota, for example, have the highest average salaries.

An entry-level stock trader can earn around $16.50 per hour, while a top-level specialist with plenty of experience can make $65 and more per hour.

How much does it cost to become a stock trader?

You don’t necessarily need to have a degree to become a stock trader; however, a bachelor’s degree in accounting or finance can be helpful.

A year in a university can cost you anywhere between $8.000 and $45.000 (and more); the cost depends on a variety of factors (bear in mind that the books, supplies, and accommodation expenses are not included).

You would also need to complete certain license requirements; it will cost you over $245 to get a Series 7 General Security Sales License, for example.

What is the demand for stock traders?

Between 2016 and 2026, the foreign exchange trader job market is expected to grow by 6.2%, according to the Bureau of Labor Statistics.

That’s a bit slower than the average for all occupations in the United States.

The growth of the financial sector will increase the demand for investment banking and trading advisory services.

The industry is mainly concentrated in Texas, New York, and California.

How long does it take to become a stock trader?

If you are planning on working for a big company, a lot of those require the candidates to have a master’s in business or finance and sometimes even a Ph.D., as well as years of successful trading experience.

It will take you 4 years to obtain a bachelor’s degree and 1-2 years to get a master’s degree. A Ph.D. will take you a minimum of 4 years to complete.

To qualify for the Series 7 exam, you must be sponsored by a FINRA member firm.