The financial markets are among the biggest wealth generators in the world, and millions of people make their income from them. There are still those on the outside, however, who view speculating on stocks, shares or currency pairs as a potentially profitable pastime at best, and at worst, a potentially ruinous hobby akin to gambling.
When examined closely, this attitude doesn’t make much sense. We have no problem in admitting that the thousands of institutional traders working for major accounts in the city are employed in a full-time job, so by the same logic, why shouldn’t we class independent retail traders as entrepreneurs? After all, they are working for themselves, taking risks, and hopefully making money, just like any entrepreneur you could name.
What is a retail trader?
A retail trader is defined as an independent, individual trader who buys and sells securities for a personal account, that is, on their own behalf. They will generally use an online broker, selected after comparing trusted opinions such as this Digital Currency Market review from LeapRate. Just as entrepreneurs are always in competition with major firms and corporations operating in the same sector as them, so retail traders are up against the institutional traders working for big companies who have much greater funds to draw on.
An uphill struggle
In recent years, both entrepreneurs and retail traders have more advantages than they used to, thanks to the growth of the internet and the subsequent wide availability of information. This has levelled the field somewhat, but entrepreneurs and retail traders remain plucky underdogs in an increasingly corporate world.
Retail trading, like starting a business, is an uphill struggle. Those who succeed start small and then gradually build up and diversify. You don’t need any qualifications or training to enter the field, but you do need to have the right kind of personality. Both entrepreneurs and retail traders are people who can handle risk, and need to be focussed, dedicated and passionate about what they do.
There are some key differences between entrepreneurs and retail traders, however. Most obviously, entrepreneurs design, manufacture and sell a product to make money, whereas traders go directly to the making money stage. Entrepreneurs also need to be more people-oriented; their success depends on making contacts, and as their business grows, they will need excellent leadership skills. While entrepreneurs build a team around them, traders tend to work alone.
A question of attitude
Ultimately a retail trader is an entrepreneur if they approach their activity like an entrepreneur. This means trading full-time as a job, with a methodical, professional attitude. For a trader to be an entrepreneur, they need to consistently make money from trading and have a long-term strategy to do so.
Without this attitude, most retail traders won’t survive for long anyway, so it can be said that most successful retail traders are indeed entrepreneurs. Some would say that to really be called an entrepreneur, you would have to set up a more formal business structure, such as your own fund or trading house. Nevertheless, many of the characteristic qualities of entrepreneurship, such as risk, dedication, creative thinking, and the need to be your own boss, are definitely present in retail trading.