How Do I Become a Junior Trader?

A junior trader assists a licensed broker with processing securities trades on behalf of clients. Someone wishing to become a junior trader must obtain a securities license from the regional or national regulatory board. Many firms employ junior traders who have the academic credentials necessary to move into senior trader roles further down the line. Since senior trades normally have advanced degrees, anyone wishing to become a junior trade should consider pursuing a college education.

Traders have to buy and sell securities such as stocks and bonds on behalf of institutions and individual clients. In most countries, laws require traders to hold valid securities licenses. The licensing process typically begins when a candidate attends a securities training class or completes a certain number of hours of online or classroom based study. After the studying the materials, candidates must pass an exam that is administered by securities regulators. People who successfully pass the exam can pay a fee to purchase a securities license and someone wishing to become a junior trader must obtain this license before applying for a trading job.

Junior traders can process trades that involve almost any type of security, but some traders first gain experience by selling mutual funds. Traders must first obtain a fund-trading license but in many instances, banks and insurance firms pay for existing employees to obtain these licenses. Prospective junior traders can gain their first securities license and some trade related experience without having to pay for the training class or the license with their own funds. Trades involving stocks and bonds are more complex than mutual fund trades so many investment firms prefer to hire people who have previously worked as mutual fund sales agents.

Senior traders solicit sales and provide investment advice to clients but junior traders often complete the actual paperwork for these transactions. Someone wishing to become a junior trader must have good administrative skills and a rudimentary knowledge of math. Most firms regard a high school diploma as a job prerequisite but some company's hire entry-level junior traders who did not graduate high school. These individuals must pass job candidate assessments.

Junior traders are less well compensated than brokers even though they perform many of the same functions. In many instances, someone hoping to become a junior trader may see the job as a stepping-stone to a broker job. Firms normally require brokers to have advanced degrees in finance or economics so many prospective junior brokers obtain these degrees before applying for jobs with investment firms.