What Is an Equity Trader? (With Job Duties and Tips)

By Indeed Editorial Team

Updated 7 December 2022

Published 12 October 2021

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Equity traders have an important role in ensuring their clients make informed decisions about their investments. They use their knowledge of the capital market and their analytical skills to make investments that may benefit them and their clients financially. If you're interested in a career as an equity trader, learning more about the role can help you determine if it suits your professional goals. In this article, we answer the question, 'What is an equity trader?' and explore equity trader job duties, requirements, work environments and related careers.

Related: 8 Types of Traders and What They Do (Plus Skills)

What is an equity trader?

To understand what is an equity trader, this finance professional buys and sells securities, also known as stocks or shares, of publicly traded companies. Equity traders work within the equity capital market, where they exchange their clients' money for stocks. They select stocks based on their projected value, which they estimate by researching trends. Trends of commodities reflect the daily change of share prices, while market trends monitor patterns of share values over weekly or monthly periods.

Equity traders develop strategies for purchasing and selling shares by evaluating the preferences of their clients. They consider factors such as how much a client is willing to invest and the level of risk they feel confident taking. Some clients prefer low-risk stocks because they carry a lower risk of loss, while others prefer high-risk stocks because they typically offer a higher return on investment (ROI). Equity traders help their clients determine a risk balance and invest their funds accordingly.

Related: What is a Stockbroker: Role, Needed Skills and Salary

Equity trader job duties

The duties of an equity trader vary depending on their employer, the number of clients they have and the amount of funding their clients want to invest. They complete different tasks at daily, weekly, monthly and quarterly intervals. Here are some common equity trader job duties:

  • Buy and sell securities on the equity capital market on behalf of their clients

  • Advise investors about their investment resources and approaches

  • Develop strategies for making lucrative investments

  • Create trade reports to report sales of stock

  • Draft client reports detailing investment activity over a certain period

  • Build and nurture business relationships with investors

  • Monitor market trends to identify patterns

  • Evaluate the risks associated with equity trading to prevent or minimise them

  • Adhere to legislation and guidelines enforced by the Monetary Authority of Singapore (MAS)

Read more: What Does an Equity Trader Do? (With Job Duties and FAQs)

Equity trader requirements

The requirements for working as an equity trader may vary depending on your specific career path. Here are some general requirements for becoming an equity trader:

Education

Equity traders have at least a bachelor's degree in finance, business, economics or a related field. Employers typically require bachelor's degrees because of the advanced technical skills and practical knowledge necessary for the role. Some equity traders also pursue a postgraduate diploma or master's degree in the same field in which they earned their bachelor's degree or a related field. This allows them to broaden their skill set, learn more about how to make optimal investment decisions and work toward higher-paying positions.

Related: What Can You Do With a Finance Degree (Plus 14 Common Jobs)

Training

Equity traders often begin their careers by taking part in internships with financial firms while they attend university. This allows them to practise the skills they learn in their degree programme and update their CVs with relevant work experience. Professionals who are new to the field can also gain experience by working in an entry-level position in finance before pursuing a job as an equity trader, seeking an employer who hires fresh graduates or working as an apprentice under the supervision of an experienced equity trader.

Licencing

Companies have a legal obligation to conduct activities in the capital market that are governed by the Securities and Futures Act (SFA). This means that any equity trader who opens their own investment firm applies for a capital markets service (CMS) licence to practise legally. Companies with a CMS licence that employ equity traders appoint their traders as representatives, which allows them to perform market activities on behalf of the company. The law requires CMS representatives to:

  • Be at least 21 years of age

  • Meet the educational requirements for working as an equity trader

  • Be considered fit and proper for the role under legal guidelines

Related: What Does an Equity Research Analyst Do? Skills and FAQs

Skills

Equity traders use a combination of technical and soft skills to complete their duties. They also maintain a practical knowledge of the finance industry and stay updated on news and trends, so they can provide quality services to their clients. Here are some common skills equity traders use to do their jobs effectively:

  • Analytical skills: Equity traders analyse the market to identify investment opportunities.

  • Attention to detail: Stock values change quickly, so equity traders monitor them closely to watch for trends.

  • Research skills: Equity traders conduct research daily on commodities trends and interest rates.

  • Emotional regulation: Controlling their emotions allows for effective decision-making in unfavourable situations.

  • Organisational skills: Equity traders keep large amounts of data and client information separate and organised.

  • Communication skills: Communicating regularly with clients is essential for maintaining business relationships.

  • Software applications: Equity traders use many types of software to conduct research, make trades and create reports.

Related: Hard Skills vs. Soft Skills: Definitions and Examples

Equity trader work environment

Equity traders can work in many environments depending on their employer and how they conduct business. Some investment professionals do their trading online, while others work on trading floors in stock exchange buildings. Equity traders spend a significant portion of their day in office spaces, where they can communicate with investors and conduct trades. After gaining experience, some equity traders choose to start their own firms and work remotely.

They usually work during trading hours, which are similar to regular business hours. Those who trade in global markets may work at any hours of the day or night, depending on the trading hours for the market in which they invest. Some equity traders also work during after-hours trading periods.

Related: How to Become a Trader (With Salary, Steps and Skills)

Equity trader job description example

Here is an example job description to help you better understand this role:

KLD Financial is seeking an experienced equity trader to join our team. The equity trader will be responsible for building new relationships with investors, conducting regular market research, executing trade orders and completing trade reports in accordance with legal requirements. The ideal candidate will have a bachelor's degree in finance, at least three years of experience in an equity trading role and experience leading teams. Experience working with trading software applications is preferred.

Careers related to equity trading

People considering a career as an equity trader also have other career options to explore in the finance industry. Reviewing job descriptions for these positions can help you decide if being an equity trader suits your interest, or if you prefer another role in the field. Here are some related career options:

  • Investment banker

  • Financial analyst

  • Portfolio analyst

  • Venture capitalist

  • Financial advisor

Related: Highest Paying Jobs in Singapore

Tips for becoming an equity trader

Here are some tips to consider if you're interested in becoming an equity trader:

Talk to professionals in the field

While you're exploring careers in finance, talk to professionals you know in the field to learn more about what equity traders do. You might consider asking questions about their personal experience in the role, such as whether they find it fulfilling, the most rewarding aspects of the role and their greatest challenges. If you don't have contacts in the field, look for networking opportunities on professional social media pages or on your university campus. You may have instructors or peers with contacts in finance who can meet with you to discuss their careers.

Related: Why Is Networking Important and How To Start Networking

Follow professional organisations

Professional finance organisations offer many benefits for members, such as updates about the industry, publications, continuing education opportunities and special events. Many offer programmes, such as webinars and conferences, where you can meet virtually or in person with other aspiring equity traders and experienced finance professionals. These resources can give you useful information that may help you make career decisions, gain knowledge and learn new skills.

Update your CV

If you're entering the workforce for the first time, be sure to create a CV. Even without experience in the field, you can list qualifications that may get the attention of hiring managers, such as your education, career goals and training programmes you've completed. Remember to add to your CV each time you earn a new credential, such as earning a degree or attending a conference. These details show hiring managers your relevant skills and your passion for working as an equity trader.

Related: Stock Trader Resume Guide (With Template and Example)

Please note that none of the companies or certifications mentioned in this article are affiliated with Indeed.

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