There are four different types of derivatives jobs. One looking for work in the derivatives market could look for positions in sales, trading, analytics, or back-office. There are also a number of positions, such as finance management jobs, that require knowledge of the derivatives market.
A derivative is a kind of investment. When two different parties make a financial agreement regarding the future value of assets, they have participated in this kind of investment. The most common types of derivatives are futures, options, and swaps. One can find derivatives applied to debts, indexes such as NASDAQ®, and even to physical commodities.
Investment professionals in sales derivatives jobs most commonly act as brokers. Their primary duty is to bring in clients with assets who are seeking investors. Among these derivatives jobs, there are brokers who sell retail derivatives and brokers who sell institutional derivatives.
Trading derivatives jobs require investment professionals to sell the actual instruments. Instruments are the values on which the derivatives are based. For example, a derivatives trader might try to sell a potential buyer an equity based asset by making a competitive offer. Many financial experts consider traders to be the professionals who shape the market.
A professional who acts as a derivatives analyst is one who literally analyzes the market. One of these professionals might look at how foreign currencies or stocks are impacting a particular market then make predictions as to how the market will behave. These financial analysts may work for insurance companies, banks, investment firms, or for any organization that has need for financial market expertise.
Finally, the back-office derivatives jobs most often go to those with accounting backgrounds. These positions require that professionals understand rules and regulations related to finance. These derivatives specialists also may be known as compliance officers.
For the most part, all of the professionals in derivatives jobs have backgrounds in business. In some cases this means that they have college degrees in business. Others may have graduate degrees in finance. While not all derivatives specialists have college degrees, they all do have an aptitude for math. Many of these positions require trading and selling, so communication skills are helpful for those who would like to enter the profession.
Derivatives analysts tend to have accounting backgrounds. In some countries, the accountants must be certified. As a matter of fact, in many schools the the accountant education is housed a school that is separate from the business school. Regardless, derivative analysts also benefit from having advanced business communication skills.
