According to Glassdoor the average annual salary of a derivatives trader is $113,801 in the US. The median salary for a derivatives trader stands at $130,355 across the US. This shows how on average the job can be handsomely rewarding for finance professionals.

Salary ranges can vary considerably depending on the following factors:

  • City
  • Education
  • Certifications
  • Work experience

Where is the salary of a derivatives trader the highest?

According to Comparably, San Francisco and Washington D.C. are the cities where the average derivatives trader salary is the highest, at $212,165 and $184,122 respectively. 

In San Francisco, the average derivatives trader salary is 51% higher than the average across the country. In Washington D.C., the average salary is about 31% higher than the national average.

What is a derivatives trader? 

A derivative trader is a finance or investing expert who trades derivatives, or secondary securities on the stock market. Derivatives can be traded over the counter or on a stock market by derivative traders. 

To ensure efficient investment transactions, traders who purchase and sell derivatives must also have a comprehensive knowledge of the stock market, market activity, and market trends. 

Derivative traders may also work for large investment and financial organizations, like funds or even large commercial banks. They may buy or sell derivatives on behalf of the entity they work for, or on behalf of customers.

What does a derivatives trader do? 

Previously, a derivative trader may have been spotted on the stock exchange floor, trading using the open outcry method. 

A derivative trader today is most likely to be seen in front of a computer, calculating estimations and experimenting with code in order to make faster and better trading decisions. 

A typical day at the office would begin with the derivatives trader reviewing all of the data feeds accessible to them. They would modify them to give more information on the most recent breakthroughs in his field of study. 

A derivative trader would then calculate their hedging limits and enter them into the order book before the market opened in the morning.