A Day in the life of a Foreign Exchange Trader

A foreign exchange trader looks at the various factors that influence local economies and rates of exchange, then takes advantage of any misvaluations of currencies by buying and selling in different foreign exchange markets. Those with the most information, the best contacts, and strongest decision-making skills come out ahead. “It’s the wild west of trading,” wrote one foreign exchange (FX) trader, “and remember: A lot of people died in the wild west.” Those who are comfortable with a high degree of risk and uncertainty should look into this exciting career. A foreign exchange trader manages an account, looks at reports, reads the press from various countries, and most importantly, spends time on the phone. He may spend up to 80 percent of the day on the telephone and working at his computer. Traders must act fast to exploit valuation differences: “You’ve got seconds to decide how millions of dollars should be spent,” said one trader, “so you have to have confidence.” Confidence ranked second right after “guts” in qualities important in new traders. A sharp analytic mind is also crucial; while a variety of degrees are helpful, those with technical or scientific analysis backgrounds tend to find the job more manageable. Accounting strengths are helpful in keeping track of positions and profit and losses throughout hectic days. FX traders specialize early in their careers, following one currency and the underlying economy of its country. Many traders specialize in groups of geographically related countries, such as those who trade Central American currencies or Pacific Rim currencies. Since foreign exchange trading is international, it can take place at any time of day. Many managers run twenty-four-hour shops and do business around the clock; most employees do have regular shifts, but world events may demand being summoned from bed late at night. Eighty percent of the traders we surveyed were satisfied with their choice of profession, but over 40 percent responded that they were exhausted at every day’s end.