What does a commodity trader do?
Commodity traders can be businesses or individuals that mainly focus on investing in oils, gold, or agricultural products. They keep up with the news on commodities to ensure that they know the different forces that determine their prices and use their technical analysis skills to decide to enter or exit trading decisions based on the current trend. These traders often use a futures contract to buy or sell commodities from any category at a predetermined price and time in the future.
Commodity trader responsibilities
Here are examples of responsibilities from real commodity trader resumes:
- Trade, build, manage, and modele interest rate derivative positions via exchange floor
- Manage and execute physical/financial grains book as well as base metal arbitrage portfolio.
- Manage procurement and sales of bulk grains and agricultural commodities for redistribution into local dairy operations in Idaho.
- Trade a variety of investment vehicles including commodity futures, FOREX and equities.
- Develop automated and discretionary trading systems for currency, commodity futures, and equities markets.
- Assist in audits from FINRA at corporate and branch levels.
- Research of stock index futures price series of statistical arbitrage strategy.
- Execute trades of futures and equities through online transactions or by telephone.
- Transact business in all types of Eurodollar products, the flagship contract at the CME.
- Assist day-to-day activities of crude oil trading on a variety of platforms such as Reuters, Bloomberg, and CQG.
- Analyze the fundamental conditions of all markets with assistance of Bloomberg financial news and Reuters to assist in making trading decisions.
- Develop new and efficient strategies for trading international commodities by gaining knowledge in online marketing strategies.
- Create unique, highly successful trading methodology for off-floor trading utilizing momentum, pairs and statistical arbitrage techniques.
- Automate the trade allocation and reconciliation procedures using VBA programming which is leveraged to systematically detect any trade breaks or discrepancies.
- Used strategies with option derivatives and future contracts to hedge risk and optimize return.
Commodity trader skills and personality traits
We calculated that 14% of Commodity Traders are proficient in Commodities, Commodity Trading, and Logistics. They’re also known for soft skills such as Analytical skills, Customer-service skills, and Detail oriented.
We break down the percentage of Commodity Traders that have these skills listed on their resume here:
- Commodities, 14%
Developed organic business within Cereal Byproducts; including the purchase and sale or organic commodities and maintaining proper certification compliance.
- Commodity Trading, 11%
Opened a commodity trading firm in Chicago, IL.
- Logistics, 11%
Coordinated rail logistics of inbound products into trans-loading facilities in Southern Idaho.
- Market Trends, 9%
Monitored daily forecast of market trends for national partners to advise and capitalize on profitable purchases and new business opportunities.
- Derivative, 6%
Open outcry market maker on The New York Board of Trade, providing liquidity to soft commodity derivative markets.
- Financial Markets, 5%
Operated computer system connected directly to financial markets overseas to generate profit by buying and selling during overnight hours.
"commodities," "commodity trading," and "logistics" are among the most common skills that commodity traders use at work. You can find even more commodity trader responsibilities below, including:
Analytical skills. To carry out their duties, the most important skill for a commodity trader to have is analytical skills. Their role and responsibilities require that "to judge the profitability of potential deals, securities, commodities, and financial services sales agents must have strong analytical skills." Commodity traders often use analytical skills in their day-to-day job, as shown by this real resume: "performed analysis to assess relative value among different points in volatility surface and calibrated model parameters to match market prices. "
Customer-service skills. Another soft skill that's essential for fulfilling commodity trader duties is customer-service skills. The role rewards competence in this skill because "securities, commodities, and financial services sales agents must be persuasive and make clients feel comfortable with the agent’s recommendations." According to a commodity trader resume, here's how commodity traders can utilize customer-service skills in their job responsibilities: "market analysis to follow up main competitors and customers comparing both domestic and international offers and prices. "
Detail oriented. This is an important skill for commodity traders to perform their duties. For an example of how commodity trader responsibilities depend on this skill, consider that "investment bankers must pay close attention to the details of initial public offerings and mergers and acquisitions because small changes can have large consequences." This excerpt from a resume also shows how vital it is to everyday roles and responsibilities of a commodity trader: "conducted detailed technical analysis to formulate profitable trading strategies. ".
Initiative. For certain commodity trader responsibilities to be completed, the job requires competence in "initiative." The day-to-day duties of a commodity trader rely on this skill, as "securities, commodities, and financial services sales agents must create their own client base by making “cold” sales calls to people to whom they have not been referred and to people not expecting the call." For example, this snippet was taken directly from a resume about how this skill applies to what commodity traders do: "conducted daily strategic initiatives in consideration of prevalent market conditions, risk exposure and anticipated outcome profitability. "
Math skills. Another crucial skill for a commodity trader to carry out their responsibilities is "math skills." A big part of what commodity traders relies on this skill, since "securities, commodities, and financial services sales agents need to be familiar with mathematical tools, including investment formulas." How this skill relates to commodity trader duties can be seen in an example from a commodity trader resume snippet: "trade commodity futures for my own account utilizing quick math skills combined with iron discipline. "
The three companies that hire the most commodity traders are:
- Koch Industries10 commodity traders jobs
- Freeport-McMoRan2 commodity traders jobs
- Nucor2 commodity traders jobs
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Compare different commodity traders
Commodity trader vs. Energy derivatives trader
The foreign exchange market is volatile and influenced by numerous factors. A foreign exchange trader considers these factors and utilizes them in their favor. They typically take care to predict misvaluations of currencies accurately. They act on the conclusions reached from their analysis and either buy or sell assets in different markets. This position requires diligence and patience.
While similarities exist, there are also some differences between commodity traders and energy derivatives trader. For instance, commodity trader responsibilities require skills such as "commodity trading," "logistics," "market analysis," and "crude oil." Whereas a energy derivatives trader is skilled in "python," "interest rates," "p/l," and "fixed income." This is part of what separates the two careers.
Energy derivatives traders really shine in the agriculture industry with an average salary of $116,251. Comparatively, commodity traders tend to make the most money in the finance industry with an average salary of $107,999.The education levels that energy derivatives traders earn slightly differ from commodity traders. In particular, energy derivatives traders are 7.5% more likely to graduate with a Master's Degree than a commodity trader. Additionally, they're 1.3% less likely to earn a Doctoral Degree.Commodity trader vs. Foreign exchange trader
A Hedge Fund Trader specializes in developing investment strategies through market research and analysis. Although the extent of their duties depends on their company of employment, it typically includes managing and monitoring market portfolios, trading according to policies and regulations, reaching out to potential business partners through calls and correspondence, discussing terms, and keeping an eye on stock prices. A Hedge Fund Trader must maintain an active communication line with staff for an efficient and fruitful workflow.
Each career also uses different skills, according to real commodity trader resumes. While commodity trader responsibilities can utilize skills like "commodities," "commodity trading," "logistics," and "financial markets," foreign exchange traders use skills like "manage risk," "foreign exchange products," "foreign currency transactions," and "swaps."
Foreign exchange traders earn a higher average salary than commodity traders. But foreign exchange traders earn the highest pay in the finance industry, with an average salary of $118,788. Additionally, commodity traders earn the highest salaries in the finance with average pay of $107,999 annually.In general, foreign exchange traders achieve similar levels of education than commodity traders. They're 3.2% more likely to obtain a Master's Degree while being 1.3% less likely to earn a Doctoral Degree.Commodity trader vs. Hedge fund trader
Some important key differences between the two careers include a few of the skills necessary to fulfill the responsibilities of each. Some examples from commodity trader resumes include skills like "commodity trading," "logistics," "market trends," and "financial markets," whereas a hedge fund trader is more likely to list skills in "hedge funds," "fixed income," "inbound calls," and "asset management. "
Hedge fund traders typically earn similar educational levels compared to commodity traders. Specifically, they're 2.6% less likely to graduate with a Master's Degree, and 1.7% less likely to earn a Doctoral Degree.Commodity trader vs. Municipal bond trader
Even though a few skill sets overlap between commodity traders and municipal bond traders, there are some differences that are important to note. For one, a commodity trader might have more use for skills like "commodities," "commodity trading," "logistics," and "derivative." Meanwhile, some responsibilities of municipal bond traders require skills like "fixed income," "bonds," "institutional sales," and "securities. "
The average resume of municipal bond traders showed that they earn similar levels of education compared to commodity traders. So much so that theyacirc;euro;trade;re 3.6% less likely to earn a Master's Degree and less likely to earn a Doctoral Degree by 0.5%.Types of commodity trader
Updated January 8, 2025
