What does a trader do?

Trading is one of the most dynamic and representative activities in today’s financial sector. Every year, more professionals choose to dedicate themselves to trading in the markets — whether independently or within specialist firms — with the goal of generating profits.

This professional profile, known as a trader, is closely associated with graduates a degree in Economics, or with those who have completed postgraduate programmes such as the Master’s in Financial Management at Universidad Europea.

In this post, we’ll explain what a trader does, what their main functions are, and how you can train to work in this exciting financial environment.

What is a trader?

A trader is someone who buys and sells financial assets, such as currencies, shares, cryptocurrencies, or derivatives, with the aim of making profits over the short, medium or long term.

Unlike a traditional investor, a trader has a much more active approach. They make decisions based on technical analysis, market data and price movements, rather than long-term fundamentals alone.

Today, many traders work independently, while others are employed by financial management teams, investment banks, or trading firms.

When this activity is carried out continuously, using advanced analytical tools and within regulated markets, we refer to a professional trader, someone who manages large capital volumes, may use algorithms or automated systems, and must comply with financial regulations.

What does a trader do day to day?

So, what does a trader do on a typical working day? Their role goes far beyond simply buying and selling on the stock market. It combines analysis, strategy, and the ability to react quickly to changing market conditions.

Here are the main responsibilities of a trader:

Study the Market Before Trading

Before making any trade, a trader analyses prices, trends, technical indicators and external factors that could influence market behaviour. They use tools such as candlestick charts, oscillators, and statistical models to identify trading opportunities.

Design a Trading Strategy

Every trader develops a personal strategy that defines how and when they trade. This includes choosing the asset type, time frame and acceptable risk level, as well as setting entry points, profit targets (take profit), and stop-loss limits.

Execute Trades Accurately

Whether manually or through automated systems, traders must execute trades at the right moment. Timing and precision directly affect profitability.

Manage Risk and Capital

Effective risk management is one of the most important aspects of trading. Traders decide what percentage of their capital to risk per trade and apply techniques to minimise losses and protect profits.

Evaluate and Adjust Strategies

After each trading session, traders review their performance — analysing what worked, what didn’t, and how to improve. This process of continuous evaluation helps refine their methods over time.

Stay Updated with Financial News

Macroeconomic data, central bank policies, or geopolitical events can all influence the markets. A good trader keeps up to date with the latest financial and economic news to anticipate market movements.

How to become a trader

There’s no single route to becoming a trader, but formal training in finance and economics provides a strong foundation.

At Universidad Europea, several academic paths can prepare you for a trading career — such as the Degree in Business Administration, the Bachelor’s Degree in Business and Economics, or the International Business Degree.

Many graduates later choose to specialise further through postgraduate study, such as the Master’s in Financial Management. This type of programme enables you to:

• Gain advanced knowledge of financial markets and instruments.
• Understand the dynamics and regulation of global markets.
• Develop quantitative and technical analysis skills.
• Learn to manage investment portfolios effectively.

It’s also common to complement your training with specialist trading courses or professional certifications such as those from the CNMV (National Securities Market Commission), CFA (Chartered Financial Analyst), or EFPA (European Financial Planning Association).

Career opportunities for traders

Once qualified, traders can pursue a variety of roles within the financial industry. Some of the most common include:

• Independent Trader (Retail Trader): Operates with their own capital via online platforms.
• Proprietary (Prop) Trader: Trades using a company’s capital, sharing profits with the firm.
• Institutional Trader: Works for a financial organisation such as a bank, fund manager, or insurance company.
• Foreign Exchange (FX) Trader: Specialises in currency markets and exchange rate movements.

Over time, experienced traders may progress into roles such as financial analyst, portfolio manager, risk manager, or derivatives specialist.

Frequently asked questions about traders

• What is the difference between a trader and an investor? Traders operate actively in the short or medium term, seeking to profit from price fluctuations. Investors usually hold positions for longer periods, focusing on long-term growth.
• Do you need training to become a trader? Yes. While there’s no mandatory qualification, having a university degree and specific financial training greatly improves your chances of success.
• Can you make a living from trading? Some people do, but it requires experience, discipline, and excellent risk and emotional management.
• What platforms do traders use? Popular platforms include MetaTrader, TradingView, eToro, and Interactive Brokers, depending on experience level and asset type.
• How much does a trader earn? Earnings vary depending on the type of trading, capital managed, and work environment. In financial institutions, salaries can reach or exceed £75,000–£80,000 per year, according to Glassdoor. Independent traders’ income is more variable and depends on performance.

Conclusion: Is Trading the Right Career for You?

So, what does a trader do? In short, a trader analyses markets, manages risk, executes trades, and adapts strategies to generate consistent profits. It’s a challenging yet rewarding career for those passionate about finance, data, and decision-making.

Summary

• A trader buys and sells financial assets to make short- or long-term profits.
• Their work involves market analysis, strategy design, trade execution, and risk management.
• Strong financial training from institutions like Universidad Europea helps build a solid career foundation thanks to the degrees in business and technology.
• Traders can work independently or for financial organisations in roles such as FX trader, portfolio manager, or risk analyst.
• Success requires discipline, analysis, and continuous learning in a constantly evolving market.