Financial traders analyse markets and buy and sell assets to help banks, organisations and investors pursue returns or manage financial risk
As a financial trader, you'll use market knowledge, data and judgement to trade assets such as bonds, commodities, cryptocurrencies, currencies, derivatives and shares. The role suits graduates who can analyse information quickly, communicate clearly and make responsible decisions under pressure.
Types of financial traders
Financial traders usually work in one of the following roles:
- Flow traders - buy and sell securities, futures, options, commodities and other products for a bank's clients.
- Sales traders - act as intermediaries between clients and market makers, taking instructions from clients and passing them to the people who execute trades.
You may specialise in a product or market, such as fixed-interest bonds, foreign exchange (FX) or shares.
Proprietary, or prop, traders use a firm's own money to trade on market movements. Following the 2008 financial crisis and tighter banking regulation, this work is now generally carried out by specialist firms rather than conventional banks.
Financial trader responsibilities
Flow and sales traders share many activities, but their focus differs. Flow traders take calculated market risk to seek returns, while sales traders focus on understanding client needs and arranging suitable trades.
Typical flow trader activities include:
- analysing data and researching UK and international markets
- communicating market movements and key trades to clients and colleagues
- executing trades electronically or by phone
- identifying mispriced assets and assessing valuations
- making prices for relevant products
- monitoring market performance and responding quickly to changes
- predicting market movements and buying or selling accordingly.
Sales traders concentrate on client relationships and identify financial products or opportunities that may suit their clients.
Typical sales trader activities include:
- analysing markets, data and valuations
- building client relationships and presenting ideas
- identifying issues that may affect clients
- keeping market-making traders informed about relevant client and product issues
- producing detailed market reports
- securing business from new clients.
Financial trader salary
- Graduate, junior or entry-level financial traders typically earn £30,000 to £50,000 in London and £25,000 to £40,000 outside London, plus bonuses.
- Traders with a few years' experience usually earn in the region of £60,000 to £120,000, plus bonuses.
- Senior and high-performing traders can earn up to £250,000 or more, particularly in areas such as derivatives.
Bonuses can form a significant part of total earnings, especially in proprietary trading. Financial firms must set appropriate ratios between fixed and variable pay, although the former EU bonus cap has been lifted.
Benefits may include mortgage subsidies and non-contributory pension schemes.
Salary figures are intended as a guide only.
Financial trader working hours
Experienced traders commonly work from 7am to 6.30pm, while new entrants may work longer hours. Hours vary by market: foreign exchange trading may run from 6.30am to 5pm, while oil trading may run from 8am to 6.30pm or 9.30am to 8pm.
Part-time roles are uncommon, although job shares and career breaks may be possible.
Financial trader work environment
- Most roles are office based, with many UK opportunities in London.
- Overseas travel may be required, particularly for sales traders with international clients.
- Self-employment and freelance work are unusual without substantial experience.
- Trading can be fast paced and demanding because decisions may involve large sums of clients' or employers' money.
Qualifications for financial traders
This career is open to graduates from any subject, but the following degrees may be particularly relevant:
- accountancy
- business
- economics
- finance
- mathematics
- politics
- sciences
- statistics.
Entry standards are high and employers commonly expect at least a 2:1 degree. Selection may include interviews and psychometric tests, sometimes completed on the same day.
Foreign language skills can be useful when working with clients and markets across Europe, Asia and Latin America.
Entry without a degree or HND is difficult. One possible route is to begin in an administrative role, build industry knowledge and contacts, and apply for trader positions later.
Skills for financial traders
You'll need to demonstrate:
- analytical and numerical ability
- clear communication and relationship-building skills
- confidence and sound decision making
- integrity and accountability
- resilience and the ability to work under pressure
- self-motivation and independent thinking
- teamwork and a strong interest in financial markets.
Financial trader work experience
Pre-entry experience is not essential, but internships, placements and vacation work can strengthen your application. Check individual employers' websites for opportunities and application details.
Major investment banks recruit graduate trainees and may offer internships, work experience and insight days for first-year students. Deadlines are often in late October or early November for roles starting the following summer or autumn. Some employers recruit as applications are received, so apply early.
Find out more about the different kinds of work experience and internships that are available.
Financial trader employers
Many UK financial traders work in London, particularly in the financial services sector known as the City.
Employers include asset managers, banks, insurers and firms that provide services to businesses.
Major financial institutions include:
Market institutions include:
Other employers include financial advisers, insurance companies and investment management firms.
Investment banks employ most financial traders and operate across major financial centres worldwide.
Competition for graduate roles at investment banks is strong, and selection processes are rigorous.
Specialist investment managers employ smaller numbers of traders. Treasury departments in very large companies may also employ traders, although this is less common.
Where to find financial trader jobs
Vacancies may also be filled through specialist recruitment agencies such as Pearse Partners, professional networks and speculative applications.
Use your university careers service, alumni networks, careers events and personal contacts to learn about the sector and identify opportunities.
Entry is highly competitive and some roles are not advertised. A targeted speculative application should explain your interest, provide evidence of your suitability and include a tailored CV.
Build your commercial awareness by reading the financial press, attending employer presentations and researching each firm's markets, culture and opportunities.
Where can a career as a financial trader lead?
Training is usually provided on the job through activities such as desk rotations, shadowing experienced traders and supporting teams with data analysis and administration. Lectures, seminars and conferences may supplement this training, and language training may be available for roles linked to particular markets.
Before carrying out regulated work, you must meet relevant eligibility and approval requirements, including those set by the FCA. The Chartered Institute for Securities & Investment (CISI) offers relevant FCA-approved qualifications, including the International Certificate in Wealth and Investment Management. You may progress to the CISI Diploma or the CFA Institute's CFA Program, and may need qualifications required by other European exchanges. Employers often pay examination fees, but you'll usually study independently.
You'll usually spend your first two years as a trainee. Job titles vary between banks, but a typical route is graduate trainee or entry-level trader, analyst or trader, associate, senior associate, vice president or executive director, and managing director. You may reach associate level two to three years after graduating.
Further progression depends on your performance, experience, qualifications, specialism and employer. With around five years' experience, you may manage a small team or lead a new desk, product or country operation. Moving between banks can help you progress, and international banks may offer opportunities in other financial centres and countries.