Fri | Mar 23, 2018

How to become an equities trader

Published:Sunday | October 12, 2014 | 12:00 AM

Personal Financial Adviser with Oran Hall

QUESTION: Your columns in the Gleaner are very informative and helpful. I am looking for your advice on how to go about getting a job as an equity trader. My formal education has been in Engineering and most of my work experience has been in this field. My true passion though has been day trading the markets.

I have been actively trading on my own for the last year with mixed results, but this has not deterred me. I want to start a new career in this field and be an active equity trader in a trading room locally or even overseas. So my question is what are the requirements to get a job in this field and is it difficult to find work in this area? There is a securities course offered at UTech, but is this sufficient? I am open to working abroad also, so would appreciate any advice you can give.


FINANCIAL ADVISER: I am pleased that you are informing yourself about personal financial issues and that I am making a contribution. It is also quite interesting that you now want to be involved professionally in the investment field.

I find it interesting that quite a few persons with a background in engineering have transitioned successfully into finance and investments.

To be an equities trader, you would need to be registered by the Financial Services Commission as a dealer representative, as you would be carrying out some of the functions that the dealer - your employer - would be licensed to perform.

By law, you would be required to satisfy certain educational and financial criteria to qualify as a dealer representative. The educational requirement is a Bachelor's degree or higher in economics, accounting or a business-related subject, professional qualification in law or accounting, or a diploma or certificate in economics or a business-related subject from a tertiary educational institution approved by the Financial Services Commission.

Apart from the Jamaica Securities Course offered by UTech/JIM School of Advanced Management to which you referred, there are four other courses approved by the FSC: the Financial Securities Management Course offered by the University College of the Caribbean; the Canadian Securities Course offered by the Canadian Securities Institute; the Portfolio Management, Certificate Programme offered by Fitz Ritson and Associates; and the Post Graduate Diploma in Financial Services Management offered by the Jamaica Stock Exchange e-Campus.

The FSC also has other requirements which dealer representatives should meet, for example, the 'fit and proper' test, which helps to determine if individuals are people of integrity.

It is important that persons wanting to work in the sector have a clean past and a good financial record. A tarnished employment record could hurt a prospective dealer representative.

The stock-brokerage companies from among which your employer would come also have their own individual requirements. To a large extent, they would require relevant working experience but one does not have to enter as a trader initially. It is possible to transition from another area to trading.

As a trader, you would be required to have good financial awareness analytical skills and to be aware of how the economy functions and what is happening in the local and international economies.

Good interpersonal skills are also vital as is the ability to give solid advice. A good trader should, therefore, keep current on the performance of the listed companies and be able to assess what is happening in the market.

Although traders are not expected to be prophets, they should be able to discern market trends and to use them in guiding their clients. Although the trading position demands a great deal of concentration, level-headedness and good judgement, I know that this can be a very exciting and satisfying position.

Trading in other countries, no doubt requires qualifications more specific to them, but the Canadian Securities Course is fully Canadian so it would be helpful in that country. This course is the basic course in the securities sector in Canada and there are many other courses that it would qualify you to enroll in.

There are also several internationally recognised qualifications, such as the Chartered Financial Analyst that would be of value to persons who are contemplating working abroad.

You already have some personal experience in investments, never mind that not all of your decisions end with favourable results. You are not singular in that regard. If you are not able to become a trader directly, start in another area and then make the change.

If you speak to the human resource, personnel of the stock brokerage companies, you should be able to get solid guidance.

Oran A. Hall, a member of the Caribbean Financial Planning Association and principal author of 'The Handbook of Personal Financial Planning', offers personal financial planning advice and counsel. Email