Educational routes into trading

The word “stockbroker” conjures up images of understated British middle class prosperity, such as gents in bowler hats sitting in their regular spots on commuter trains completing the Times crossword and returning by the same route to the suburbs. The phrase “stockbroker belt” is even used to describe these quietly prosperous areas on the outer edges of major cities.

The truth is a little different. Today’s traders bear little or no similarity to these 1970s archetypes (if they ever really existed) with the exception of the bit about prosperity. Whether you use the word stockbroker, broker or trader, the potential is excellent and the financial rewards can be significant. Let’s take a look at how you can embark on a career in this highly charged and constantly changing industry.

What does a trader do?

Put simply, a stockbroker or trader manages the investment portfolio of a broad range of clients, buying and selling stocks or providing professional advice on what types of investment will provide the best financial return.

These days, the trading market is a highly technological one. The more rapidly a trader can buy and sell shares or react to changes in the market, the more successful and profitable the outcome will be. Therefore. It is not surprising that the London Stock Exchange is seen as a pacesetter in technology, and traders need to be comfortable with the use of constantly evolving technological tools.

Academic qualifications

Entry into the world of trading is generally through a graduate programme with one of the major players. First, you will need a good degree under your belt. The minimum entry requirement is generally a 2:1 in a related discipline. Typically, this will mean you need a degree in business, economics, finance or mathematics.

Many entrants also have a postgraduate qualification. Either a general management degree, such as an MBA, or a specialist Master’s degree in trading will put you in good stead. Today, there is an increased availability of such courses online, which means you can complete the qualification via distance learning and fit the studies around other commitments.

Graduate Programmes

With a good degree, you are ready to take your first step into the world of trading. The best route is through one of the major investment banks, many of which look to recruit the next generation of traders via career fairs at universities. For example, Matthew Smith BNP Paribas has risen to a senior role through this route with one of the best known investment banks in London. His case illustrates just how far this career can take you.

BNP employs 7,500 people in the UK and has an active and successful graduate recruitment scheme, providing on-the-job training that allows interns and graduates to build their skills and specialise in several areas, including corporate, individual and real estate investments.

There are also several other major players in the UK, including JP Morgan, Goldman Sachs, and Morgan Stanley, to name just three.

Sideways steps

What about those who are in a related industry and feel that their future lies in the world of trading?

If you have the right degree and a background in the financial services industry, this is certainly a possibility. Again, you will need to develop specialist knowledge, but the online training options for distance learning make this a far more viable option today than it was 10 or 20 years ago for those who seek to attain new qualifications while holding down a full-time job.

Whatever route you take, you will need to be certified as an Approved Person by the Financial Conduct Authority before you can start trading in earnest.

Career development

The example of Matthew Smith that we looked at earlier demonstrates how far a good trader can rise. The career progression options within any of the big firms are numerous, and the general lack of glass ceilings means that there are true meritocracies in operation.

There is also the option of doing it alone as an independent fund manager or a partner in a smaller business.

How much can you earn?

Starting salaries for graduate trainees are typically in the £25,000 to £30,000 range, which is an excellent start given that the employer will also be funding training and development.

More experienced traders can soon expect to be earning more than £50,000 per year, and six-figure salaries are the norm for the very best and for senior partners.

Many of the larger companies offer generous bonuses and additional benefits, such as healthcare and gym membership.

If this sounds tempting, why not take the first steps towards a career as a trader today?