While being a stock trader is an exciting career, it takes extensive knowledge, hard work and time to be successful. Stock traders offer financial services for both individual clients and companies, and they often provide advice regarding certain investments.
That said, if you are thinking about becoming a stock trader, knowing how much they make can help determine if this is a career you want to pursue. So, how much is the stock trading salary? Let’s get into details in this article.
About Stock Traders
Stock traders are individuals who purchase stock shares they later sell at a higher rate with the objective of earning a profit. Stock traders can be either individuals investing to receive earnings or professionals trading for companies providing liquidity.
Given the technology, stock traders can perform trades from any location using a device with a stable internet connection. Some traders perform trades during market hours, while traders who work with different assets, such as crypto, can trade every day of the week.
Types of stock traders
Stock traders who make trading decisions based on the technical aspects of the market are known as informed traders. There are also traders who make decisions on market volatility and price movement and intuitive traders who execute trading moves based on technical tools and their intuition.
While every trader buys and sells stocks, they use different methods for trading. Day traders perform multiple trades every day with several types of assets, whereas swing traders hold their stocks for a longer time and later sell them when the market reaches its peak.
On the other hand, the buy-and-hold traders hold the stock for several years, anticipating that the stock will gradually rise in the future. Finally, momentum traders make market predictions and focus on short-term trading.
How Much Is the Stock Trading Salary?
The average salary for a US stock trader is estimated at $92,517 as of January 2023. That said, the average pay varies from one state to another and is also based on the trader’s skill levels and the years of experience they have.
The states with the highest stock trading salaries are San Francisco, Massachusetts, Washington, Connecticut, Texas, and Rhode Island. Many firms give stock traders bonuses alongside commissions compared to many other industries.
Stock traders that are entering this industry can expect a salary of around $25,000, whereas the top stock traders can make over $100,000 annually.
Steps to Become a Stock Trader
Now that you are familiar with the stock trading salary and the requirements for becoming a stock trader, you can proceed to trade if this is the career choice for you.
As is the case with other professions, you need a suitable level of education before getting professional employment.
Who can become a stock trader?
The requirement for the majority of stock traders is an undergraduate degree in fields such as business, finance, economics, and accounting. The reason for this is that they need to have a fundamental understanding of the stock market and how businesses operate based on the changes in the market.
Some companies offer extensive training programs and later provide internships for the candidates with the best performances. That said, to improve employment opportunities, you can also upgrade your education, as very often, traders with a master's degree make more money than those without one.
An important thing to mention is that in order to work professionally in this field, you will also need to become licensed. Here are the general steps on how to become a stock trader:
- Enroll in a suitable undergraduate program
- Sign up for and complete an internship with a financial company to gain experience
- Find professional employment and choose a specific trading job
- Register as a representative of the company you work for with FINRA (The Financial Industry Regulatory Authority)
Most entry-level positions prefer an accredited master of business administration degree or a degree in accounting, economics, and finance for employment.
Skills to Possess As a Stock Trader
In order to be a successful professional stock trader, aside from extensive knowledge about trading, you need to possess certain skills. The top traders have the ability to analyze the market and make quick decisions efficiently, as well as conduct thorough research to gain necessary information about certain trades.
Stock traders notice details, stay focused during the trading process, and know how to manage risks and avoid big losses. They also use trading strategies based on the market, know how to make calculations, and draw conclusions on the spot.
They also need to have computer programming skills to analyze the financial products the trading platforms provide as well as customer service skills to persuade clients and make necessary financial recommendations.
What are the responsibilities of a stock trader?
Now that we have mentioned the requirements you need to become a stock trader, let’s briefly talk about the responsibilities that come with this profession. The main responsibility of a stock trader is to buy and sell assets and commodities on behalf of the company.
They also maintain a connection with buyers and sellers in financial markets and implement effective trading strategies. Aside from selling securities for individuals and companies, they offer many financial services for clients, including arranging trades and providing financial advice.
While the job requirements may vary from one company to another, the common requirements are contacting clients, explaining services in detail, reporting each day’s profit and loss, and more.
Moreover, among the responsibilities are monitoring financial markets, analyzing the company's finances, making revenue agreements, and more. This profession comes with fast-paced working conditions and is very demanding.
Become a Successful Trader
Besides a reliable online trading platform to help you out in the trading process, you can also use a trading service to help you make the right decisions.
One such service is FoolProof Options , offering trading services for only $97 per month. Upon signing up, the veterans from Wall Street will provide you with a detailed trading plan and find you trades that are about to make big changes on the market.
You receive guidance on how to place orders and do risk management, as well as several alerts throughout the week, depending on the market conditions. They also offer a 14-day free trial, so you can try it out before getting a subscription.
Final Thoughts
If you have been interested in pursuing a career as a professional trader, now you are familiar with the average stock trading salary in the US.
Stock traders actively engage in the market using reliable trading platforms, and they possess the necessary knowledge and skills to analyze the market and perform trades accordingly. By executing trades and using suitable trading strategies, they attempt to profit either for themselves or the investors that have employed them.