What they do
Commodities traders negotiate and arrange the sale or purchase of physical goods or raw products such as gold, natural gas, livestock, electricity or coffee. They research and obtain information about particular commodities and market conditions, correspond with their clients about the purchase and sale of these commodities, negotiate delivery, condition, and other settlement guarantee details, and calculate and record the cost of transactions. They may also be involved in spot trading, where the delivery of goods takes place immediately, as opposed to future delivery, which is the way other commodities trading is undertaken.
Commodities traders generally spend most of their time in trading rooms or commodities exchanges, but may also work in office environments. Many commodities traders also travel to meet with clients. They usually work long but regular hours that coincide with the hours that commodity exchanges either in the eastern states or overseas are open. They may have to sit or stand for long periods of time, and when working in commodity exchanges their work environment may be stressful. Although they mostly work in cities, they may work independently from finance companies and can therefore work in other parts of the state.
Tools and technologies
Commodities traders spend a large amount of time on the phone. They also use computers, in particular financial tracking and data management software. They also use mobile phones and laptop computers to stay in touch with their clients and key contacts while they are travelling or away from the office.
How do I become one?
Education and training
To become a commodities trader you usually need to study a degree in commerce or business majoring in accounting, commerce, economics, finance, financial planning, or actuarial science. Most universities in Western Australia offer relevant courses
Commodity traders who provide personal advice to retail clients about commodity sales or purchases must adhere to the professional standards for financial advisers introduced by the Australian Government on 1 January 2019*.
The Bachelor of Commerce, majoring in Finance and Financial Planning at Curtin University is currently the only undergraduate degree in Western Australia approved under these standards by the Financial Adviser Standards and Ethics Authority.
The list of approved and relevant courses available in Western Australia may change over time. Contact the Financial Adviser Standards and Ethics Authority for more information.
Following your studies, you will be required to undertake a professional year, which includes 100 hours of training, and pass the Financial Adviser Standards and Ethics Authority exam.
*From 1 January 2019 changes to the Corporations Amendment (Professional Standards of Financial Advisers) Act 2017 mandate that every person entering the profession of financial planning (i.e. financial advisers) must complete a minimum Bachelor degree approved by the Financial Adviser Standards and Ethics Authority. VET graduates may potentially have modified employment outcomes as they will no longer meet the licensing requirements to be employed as a financial planner, financial adviser or any occupation that directly provides financial planning/advisory advice to retail clients.
Required registration and licensing
To work as a commodities trader in Western Australia, you may need to obtain an Australian Financial Services (AFS) licence from Australian Securities and Investments Commission (ASIC)