How Do I Become a Silver Trader?

A person can become a silver trader in a variety of ways. Silver can be traded through a dedicated commodities exchange market or through investment vehicles such as an exchange traded fund (ETF). Many silver traders begin their careers by managing the capital of institutional investors and using this capital to trade silver. Smaller investors looking to become a silver trader can also purchase and trade silver bullion and rare silver coins as a viable investment strategy.

Individuals looking to become a silver trader for other investors as a Commodity Trading Adviser (CTA) or Commodity Pool Operator (CPO) will need to be licensed. Aspiring silver traders looking to operate in this capacity will need to pass the Financial Industry Regulatory Authority (FINRA) National Commodity Futures Series 3 exam. Successful completion of this exam is mandatory for any silver trader in the United States that wishes to trade silver for other investors. The exam consists of over 100 questions and is designed to test candidates on their market knowledge as well as the rules and regulations that apply to trading investor capital. Other countries throughout the world have similar financial regulations for those looking to become a silver trader who will manage and trade other investors' capital.

A person looking to become a silver trader can trade his or her own capital without needing to be licensed. This is the route that many silver traders take as it requires less regulation and trading strategies can be implemented immediately. Traders can open a brokerage account and trade a variety of silver exchange traded funds. A silver ETF can be purchased just like a stock and its share price closely corresponds to the market price of silver. For those looking to become a silver trader, a silver ETF is a great way to trade silver as these funds allow individuals to invest in silver without the hassles of buying, storing, and insuring physical silver bars or coins.

Investors looking to trade physical silver can do so by purchasing silver bullion or silver bars at a local silver coin exchange. This form of silver trading generally offers less liquidity and is considered to be a long term investment. A person looking to become a silver trader can also specialize in buying and selling rare silver coins, which generally have a higher value than the market price of silver depending on its condition and rarity.