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The allure of the gyrating dollar

The Australian dollar has been performing an interesting dance – and foreign exchange traders should be among the beneficiaries.

First it was down, then it was up, now it’s down again; the Aussie dollar has been all over the place as the world tries to dodge the fallout from the US sub-prime housing crisis. For FX traders positioned on the right side of the volatility, it should prove good news in terms of profits – and therefore bonuses.

High volumes and high volatility will be less helpful if you fancy getting a job as an FX trader, however. Jonathan Barratt, managing director of Sydney-based Commodity Broking, says the FX industry’s “massive expansion” won’t translate into new hires: “The trades are electronic: it just means traders are putting more through.”

But Tony Shaw, FX specialist at Select Personnel, says both domestic and global banks are adding trading staff, and that a shortage of good candidates at home means they’re recruiting offshore – particularly in larger markets such as the UK.

Good traders (i.e. those positioned on the right side of the dollar’s gyrations) can make a packet. Matthew Clarke at Bradman Recruitment says base salaries are usually a mere AU$70k to AU$80k. But bonuses can be five times this and top traders can make more than AU$1m in total.

Comments (2)

  1. I wonder if efinancials has a ‘fiction’ section for news items?, as this would certainly be a prime inclusion, either that or a ‘comedy’ section as each would suffice.
    Apart from Jonathan Barratts comments which is bang on the money, banks are not recruiting and are absorbing the added volumes through the electronic trading mechanism’s, capacity has not been breached in the reflection of more hires.

    I don’t wish to recruitment agency bash but the quote of 70/80k for dealers is laughable, add to that the quote of 5x on the bonus and it makes it even more ridiculous.

    Ah well, it gave me a laugh though.

    TellemTheirDreamin’ Reply
  2. The truth is, traditional trading roles in FX don’t exist anymore as the electronic transaction markets have turned most of the ‘old’ trading positions into ‘inventory managers’, which is different (boring) skill set. Those FX traders who are still trading are in proprietary trading roles and you could count those roles on one hand.

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