TRADING AS A CAREER - SWISS FINANCE STUDENTS LEARN WHAT THE TRADING PROFESSION IS ALL ABOUT AND HOW TO ACQUIRE THE NECESSARY SKILLS TO BECOME SUCCESSFUL INVESTORS AND TRADERS

Traders and investors deal with the complex tasks of evaluating macro and micro trends, developing strategy and tactics, security selection, timing, execution, position monitoring, investment thesis evaluation and re-evaluation, and appropriate exit.

A Serious Trading Student's Game

Trading and investing both require purchase or sale of instruments of value for financial gain. Yet, there are generally perceived differences between the two; some consider trading to be a fast paced and almost mythical process of buying and selling, sometimes in a matter of minutes. It is also commonly and incorrectly believed that traders deal in a wider variety of instruments such as stocks, bonds, derivatives, commodities, exotics and currencies than do investors. Investors are thought to be making longer term ‘allocations’ under the buy-and-hold paradigm, specializing in equity, debt or real estate for dividends, interest or rental income, respectively. Swiss Finance students learn the common framework for both investing and trading, while acknowledging that some differences can sometimes exist between the two approaches of managing money. Here, we use the terms trading and investing interchangeably.

Swiss Finance faculty discuss the many reasons people may choose the profession. Some individuals wish to become traders because they believe it can lead to significant financial gain. Although trading can be profitable, there are many other ways to make a good living that would be more suitable for some intellectual personalities.

Others wish to go into the profession because of the excitement they believe it offers – the stakes are high and the adrenaline rush feels good. Such views are perhaps a bit misguided as they ignore the fact that trading is based on highly thought out and well researched calculations of probabilities that require full immersion into the problem at hand, and perhaps even near complete obsession at times.

Swiss Finance students examine their personal and professional motives to determine if they might be a good fit for the money management profession. Entering a profession for the wrong reasons, a profession that creates significant emotional instability at times, can cause regret down the road.

Students learn about, experiment with and examine in detail the myriad types of trading opportunities and methods. Evaluation requires honesty, realistic evaluation of one's strengths and weaknesses and long term personal fit. Again, one should not rush into such a profession which asks so much of its participants without full awareness of what would be required. There are system traders, swing traders, floor traders, and macro events traders, to name a few. Each of these require vastly different personality and skill sets. Can you stomach large losses? Do you prefer to work with others or on your own? Do you need job security? Can you live with intense emotional turmoil from time to time? Are you quick to accept that you could be wrong? Depending upon how you answer these and other questions, you would need guidance from faculty in thinking and rethinking trading as a potential career choice.

Students also learn fundamentals of the trading strategy and tactics. For example, trading requires an exit strategy before entry. Swiss Finance students need to acquire knowledge of market trends and establish an accurate view of the world that would lead to a profitable set of trades. Trading also requires a solid, well thought out plan. Naturally, traders need to be sure if they have what it take to be profitable, and equally importantly perhaps, if they would enjoy it as a career choice.

Many ambitious "wannabe traders" are attracted to the allure of trading as they believe it offers glamour, prestige, and even 'puzzle solving' challenge. They may correctly observe that there are many ill qualified individuals managing money but incorrectly conclude from this observation that trading would be easily profitable. The issue lies in failing to realize that the real competitors are a small handful, perhaps just a few hundred, individuals who are highly skilled, well equipped, well connected and vastly experienced. Swiss Finance students must understand the depth of the market sophistication. Absent this, the situation is prone to spell disaster for all novice traders.

Summary

Honesty, mental discipline, hard work, realistic expectations and money management are all critical. However, they do not offer a sufficient set of conditions to make money as a trader. You need to have an edge. The edge would need to dictate that, over the long term, on balance, the trader would be profitable. This can occur even when most trades are losers as long as losses are small while profits large. Swiss Finance students learn the framework and demands of a trading and investing career. They learn how, to be successful as a trader, one must love what one does - i.e. research, self assessment, strong interest in mathematics, psychology and even history, a great deal of reading stamina and quantitative analysis. If learning about markets is fun for you, if you can risk being wrong a lot and if you can rebound from your mistakes, then trading just might be a good fit for you.

About Swiss Finance School of Business

Swiss Finance is a leading private learning institution catering to undergraduate students, graduate students, and working professionals in North America (New York and Boston), Europe, the Middle East and Asia. We prepare our students to succeed in various fields of today's business world by combining sophisticated concepts with applied industry training. For years, Swiss Finance faculty have drawn on their professional experiences, their research, their travels worldwide, and their passion for teaching to educate some of the highest caliber individuals worldwide.

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