# FX, Rates, Credit and Commodity Traders > What FX, rates, credit and commodity traders do at banks, funds and trading houses: their markets, daily drivers, skills and how these macro trading roles differ. Source: https://learn.tradelabsai.com/industry/fx-and-rates-traders/ Track: The Trading Industry · Level: Intermediate · Updated: 2026-10-03 Publisher: TradeLabs AI (https://tradelabsai.com). Education, not financial advice. Cite as: TradeLabs Learn, "FX, Rates, Credit and Commodity Traders", https://learn.tradelabsai.com/industry/fx-and-rates-traders/ Beyond equities, a large share of the world's trading happens in foreign exchange, interest rates, credit and commodities, the markets banks group as FICC. Traders in these areas deal in currencies, government bonds, swaps, corporate bonds, credit derivatives, oil, metals and agricultural products. Their days are driven by central banks, economic data, geopolitics and physical supply and demand. The roles exist at banks, hedge funds, asset managers, commodity trading houses and producers that hedge their output. ## The four areas | Area | Main instruments | Key drivers | Lesson | |---|---|---|---| | FX | Spot, forwards, swaps, options, NDFs | Interest rate differentials, central banks, trade and capital flows | [Forex Trading](https://learn.tradelabsai.com/markets/forex-trading/) | | Rates | Government bonds, interest rate swaps, futures, options | Central bank policy, inflation, growth, supply of debt | [Bond Trading](https://learn.tradelabsai.com/markets/bond-trading/) | | Credit | Corporate bonds, credit default swaps, credit indices | Default risk, earnings, spreads, ratings | [Credit Spreads](https://learn.tradelabsai.com/bonds-credit/credit-spreads/) | | Commodities | Futures, swaps, physical cargoes | Supply, demand, inventories, weather, geopolitics | [Commodities Trading](https://learn.tradelabsai.com/markets/commodities-trading/) | ## Daily drivers | Area | What moves it | |---|---| | FX | Rate decisions, inflation data, risk sentiment, intervention. See [Central Bank Intervention](https://learn.tradelabsai.com/forex/central-bank-intervention/) | | Rates | Fed and ECB meetings, payrolls, CPI, Treasury auctions. See [The Federal Reserve and the FOMC](https://learn.tradelabsai.com/macro/the-federal-reserve-and-the-fomc/) | | Credit | Earnings, defaults, new issuance, risk appetite | | Commodities | Inventory reports, OPEC decisions, weather, shipping. See [Storage and Inventories](https://learn.tradelabsai.com/commodities/storage-and-inventories/) | ## Roles within each area | Role | Description | |---|---| | Flow trader (market maker) | Prices client trades and manages inventory at a bank | | Proprietary or hedge fund trader | Takes directional or relative value positions | | Physical commodity trader | Buys, stores, transports and sells real commodities at trading houses | | Hedger | Manages price risk for a company, such as an airline hedging fuel | | Structurer | Designs custom products for clients | **Example: A rates trader's reaction to data** A rates trader at a bank holds a position that benefits if two year Treasury yields fall. At 8:30, US CPI inflation comes in 0.2 percentage points above forecasts. Within seconds, two year yields rise 12 basis points as markets price a more hawkish Fed. With a position of $10,000 per basis point (its DV01), the move costs $120,000. The trader cuts half the position to stay within the desk's loss limit and updates clients on how the data changes rate expectations. See [DV01](https://learn.tradelabsai.com/bonds-credit/dv01/) and [CPI and PCE](https://learn.tradelabsai.com/macro/cpi-and-pce/). ## Skills needed - **Macroeconomic understanding:** how policy, growth and inflation interact. See [Macro Trading](https://learn.tradelabsai.com/strategies/macro-trading/). - **Product knowledge:** forwards, swaps, futures, options and their quirks. See [Swaps Explained](https://learn.tradelabsai.com/bonds-credit/swaps-explained/). - **Quantitative skills:** yield curves, duration, carry and volatility. See [Yield Curves](https://learn.tradelabsai.com/bonds-credit/yield-curves/) and [Carry Trading](https://learn.tradelabsai.com/strategies/carry-trading/). - **Speed and composure** around data releases and news. - **For physical commodities:** logistics, storage and contracts. See [Physical Delivery vs Cash Settlement](https://learn.tradelabsai.com/futures/physical-delivery/). ## How these markets differ from equities | Feature | FX, rates, credit, commodities | Equities | |---|---|---| | Trading venue | Much over the counter, increasingly electronic | Mostly exchanges | | Typical trade size | Very large notional amounts | Smaller per trade | | Leverage | Often high | Lower | | Main participants | Banks, central banks, funds, corporations | Funds, retail, market makers | See [OTC Markets](https://learn.tradelabsai.com/market-structure/otc-markets/). ## Getting in Graduate programs at banks commonly rotate through FICC desks. Commodity trading houses and energy companies hire analysts and traders with engineering, economics or logistics backgrounds. Hedge funds hire experienced traders with track records. See [Trading Careers Explained](https://learn.tradelabsai.com/industry/trading-careers-explained/). ## Frequently asked questions ### What does an FX trader do? Trades currencies through spot, forwards, swaps and options, either making markets for clients or taking positions, driven by rates, central banks and flows. ### What is a rates trader? A trader of interest rate products such as government bonds, futures and swaps, whose positions respond to central bank policy and economic data. ### What do commodity traders do? Trade commodity futures and swaps, and at trading houses also buy, store, transport and sell physical commodities. Next, learn about the people who watch the risk in [Risk Analyst](https://learn.tradelabsai.com/industry/risk-analyst/). ## Continue learning - Next lesson: [Risk Analyst](https://learn.tradelabsai.com/industry/risk-analyst/) - Previous lesson: [Market Maker and Options Trader](https://learn.tradelabsai.com/industry/market-maker-and-options-trader/) - Related: [Market Maker and Options Trader](https://learn.tradelabsai.com/industry/market-maker-and-options-trader/): Market makers quote prices on both sides and manage the risk they take on. Learn what market making and options trading roles involve, key skills and interviews. - Related: [Forex Trading](https://learn.tradelabsai.com/markets/forex-trading/): How forex trading works in practice: choosing pairs, lot sizes, pips, leverage, sessions, costs and risk management, with a fully worked EUR/USD trade. - Related: [Bond Trading](https://learn.tradelabsai.com/markets/bond-trading/): How bond trading works: buying bonds and bond ETFs, trading Treasury futures, reading yields, what moves rates and how duration decides your risk. - Related: [Credit Spreads](https://learn.tradelabsai.com/bonds-credit/credit-spreads/): A credit spread is the extra yield a risky bond pays over a safe benchmark. Learn how spreads are measured, what drives them and what they signal about risk. - Related: [Commodities Trading](https://learn.tradelabsai.com/markets/commodities-trading/): How to trade commodities: futures, ETFs and producer stocks, what moves oil, gold and grains, key reports to watch, costs and the risks of commodity trading. - Related: [Macro Trading](https://learn.tradelabsai.com/strategies/macro-trading/): Macro trading takes positions in currencies, rates, stocks and commodities based on economic views. Learn how macro traders think, build trades and manage risk.