The Confessions of a Floor Trader
What do floor traders do? They execute transactions. They are risk takers who put their own capital on the firing line.
An exchange member who executes transactions from the floor of the exchange exclusively for his or her own account. Floor traders used to use the “open outcry” method in the pit of a commodity exchange, but now most of them use electronic trading systems. They fulfill an important role in commodity and stock market by risking their own capital to trade futures, options or stocks, thereby providing liquidity and narrowing bid-ask spreads.
A floor trader is subject to a screening process before he or she can trade on the exchange. The National Futures Association requires floor trader applicants to file the following: Form 8-R completed online, fingerprint cards, proof from a contract market that the individual has being granted trading privileges, and a non-refundable application fee of $85.
Is trading a lucrative job? Do traders make a lot of money? Well there are those who cannot give a straight forward answer but they can actually let you know what they hated about trading.
What they hated
Getting blamed for all that’s wrong with the world. There is a segment of the population that still blames Wall Street for everything. A guy came up to me after a show recently (I’m a comedian) and said, “You worked for Bank Un-America? Wall Street is manipulating the political parties to divide the Tea Partiers and Occupiers and conspiring to manipulate the whole system to make everyone else your servant. “
I told him, “You are giving Wall Street WAY too much credit. All we want is bigger bonuses.”
Meetings to have meetings. These used to drive me crazy. Most of them were such a waste of time. “We are having this meeting so we can get all our ducks in a row,” one manager might say. This guy I used to work with wanted to have a meeting at 6:30 am on a Friday about how to do more business with a client. My advice is: Take him out on a Thursday night and spend $500 and show him a good time. So on Friday we can come in at 7:30 like normal people and he can pay us $20,000 in commission today.
What attitude should a trader have? Well those who were once there say that you must be ready to win some and lose some. But you should know that at times you have to lose in order to win.
You lose and win
Mr Muccio, a father of three from Bromley, said he had made £220 the previous day from forex trading between pounds, dollars, euros and yen – his biggest win to date.
But he has lost thousands along the way. Mr Muccio gave up a successful antiques business in 2007 to trade full time. “I was looking for an excuse to stop, this was the answer, but it was too soon. I knew absolutely nothing,” he said.
He lost £2,000 within the week. He said: “I keep going because I keep improving. Sometimes I can see trades so clearly and I know it is off the back of everything I have learned, and I can look at the charts and just know where it is going.”