Typically, TV and movies portray commodity traders as frantic men and women running across a trading floor shouting at one another, making split-second decisions that can be worth millions of dollars. For real life commodity traders, art does imitate life, as the daily job duties of a commodity trader do involve high-stakes decisions and a high-pressure environment. According to the Bureau of Labor Statistics, as of 2012, women made up only 27 percent of securities and commodities traders.
Starting Your Day
As a commodity trader, your job revolves around buying and selling commodity shares for clients to make the most money possible. Depending on your clients and the markets you trade in, your day may start early, checking foreign markets in Europe and Asia before they close and the U.S. markets open. You’ll do a quick scan of the news to stay up to date on major world events that could affect the commodity markets. Once the U.S. markets open, you analyze trades your currently in and decide whether to buy, sell or do nothing for each client. If you work as part of a team, you’ll meet with the other traders to come up with that day’s trades and strategy.
In Between Trades
While your day revolves around buying and selling, you also complete other tasks in between trades. Once you or your team has decided on the trades for the day, you’ll use computer software and good old-fashioned charts to determine the risk of each trade. Once that’s complete, you’ll enter all the information in your trading database and enter the trades in the market, either on a trading floor or from your computer. Throughout the day, you’ll look for new opportunities for trading. Many traders utilize “watch-lists” that help them spot patterns and potential trading opportunities. Many traders keep detailed records of the trades they made throughout the day, so you’ll manage a spreadsheet or database program with all your trades for the day.
Skills You’ll Use
In the past, all traders worked on a trading floor and took part in live auction-style trading. Now, many trading companies are opting for computer trading systems, taking the commodity trader off the trading floor and putting her at a desk behind a computer. If you work outside of a trade floor, you’ll do all your buying and selling via a smartphone, tablet or computer, and so you must have basic computer skills. You’ll need a cool head to work in the high-pressure trading atmosphere and be able to think on your feet and make quick decisions. When working with clients, you’ll need excellent written and oral communication skills to understand their wants and needs and provide them with updates on trades.
Your Work Environment
No two days are exactly the same for a commodity trader. While you’ll do many of the same duties each day, you’re always adding and losing clients, and each client has its own needs. The days of a commodity trader are not your typical 9 to 5; nearly 1 in 3 traders work more than 40 hours a week, according to the Bureau of Labor Statistics. Many traders also work all hours of the day, including early morning, late night and even the middle of the night, because world markets are open 24/7. Because clients are often entrusting you with millions of dollars, the work is stressful, with lots of pressure and tight deadlines. You’re also under personal pressure to get the job done because more successful trades means more commission for you. Even with the advent of computerized trading systems, most of the commodity trading action still takes place in the financial district of New York City, and so many commodity traders live in that area.
- Bureau of Labor Statistics: 2012 Household Data Annual Averages
- Bureau of Labor Statistics: Securities, Commodities and Financial Services Sales Agents
- Keep Your Capital: A Day in the Life of a Trader
- Online Trading Academy: A Day in the Life of a Trader
- United Futures Trading Company: The Basics of Commodity Futures Trading
- Ryan McVay/Photodisc/Getty Images