The Stock Trading Reality Podcast

This discussion certainly got my blood boiling. As someone who is in the coaching/teaching/mentoring business, it truly drives me insane when I see others creating a bad name for everyone. We have a shining example of this thanks to our guest today John (‘FatherOfBear’ in the chatroom) and his experience with another “coach” in the business. Even if you never spend a penny on my site, please just realize and be aware of some of the glaring red flags that many of these “I want to see you succeed” people out there display. To give John fully credit though, after the rough start due to the bad experience in attempting to learn, he didn’t give up and he continued to grind onwards and upwards. Like many of us, John has taken several bumps and bruises along the way, but the great thing for us as listeners, we can learn from them and save ourselves some money in the process. I had a great time chatting with John and I’m sure you will too. Notes: Today we interview community member John who goes by FatherOfBear in the chat rooms. John was intrigued by those who traded in the market and spent some time looking around the internet in an effort to get educated. He came to the realization that if he wanted to do this successfully, he would need to seek out quality training. Unfortunately, he decided to get training via someone who put a time limit on their program and John learns best by a high amount of repetition. A 3 month time limit is not realistic to go from knowing nothing about the markets to a proficient trader. Even without a proven track record on paper, John funded an account and started trading live. After finding some initial success, he eventually dwindled that account down to scraps. John does not like to lose and in most aspects of life, it’s a fantastic attribute. But in trading, it can be detrimental. After finding out the material in University was available for LIFE, John dove right into the program to rebuild his notion of trading. He is currently working through the foundational courses before he beings trading again. Quotes: I watched YouTube videos of people explaining what candlestick means. I would watch hours of videos. It was generic at best. I didn’t grasp how dangerous it was to trick myself paper trading. I was trading with large size since there was no risk. I get my first big win. I was thinking, I’m not over trading… I’m doing what my teacher is doing. I must be a prodigy. I started learning all about margin calls. It really hurt my account being stubborn and holding. Reinforcing those bad habit muscles. Honestly, I’m not sure I would re-do anything. I’ve eaten a lot of humble pie. Education is paramount and is worth paying for. Links: https://claytrader.com/videos/big-red-flag-world-trading-educators/

We try our best to keep things as “real” as possible on the show, and in this episode I think we do a great job of that given our guest’s strategy. In most instances, the topic of technical charts come up given many in our community use them; however, that’s not the case with fellow member Aaron. There is still lots of fine tuning going on within his strategy, especially in the trade management department, so who knows…. maybe one day charts will find a place. As it stands now, Aarron is looking to improve with each passing week and keep his account in the green. He was open and honest which we can all respect him for. Notes: Today we interview community member Aaron who is relatively new to trading. After realizing he was making next to no return keeping his money in savings, he decided to look into the market. Aaron likes to research sectors and individual companies he believes will have future growth. Considering his 9-5 job, he choose industries and companies in that space that he believes will grow. Something Aaron picked up very early on was that most people who use financial social media are generally unable to accept responsibility for their actions. After watching a few of Clay’s videos and seeing the information conveyed, Aaron decided to join the community. Aaron doesn’t utilize charts to validate his investment choices. He uses the news and fundamental information he comes across. However, he hasn’t bet the farm on any of his trades so even if they were all go to zero, he would be fine. Quotes: One thing I regret is that I haven’t taken a lot of risks in my life. I realized that my money has sat around and done nothing. When there’s a profit to be made, you have to take it. That’s the discipline I have to adhere to. The idea of short manipulation is very misconstrued. It’s like betting against the dice in craps and the odds are reversed. For me, that’s a car payment. Wow that’s a better Christmas for everyone. Don’t be ashamed of profits.

The impacts of a quality plan can lead to big things. How big? How about a six figure gain within your trading account? What I love about the podcast is the many shapes and forms the motivation and inspiration can take. This time around, the motivation is that of sheer numbers and size of just what is possible. As our guest Stan (‘PapaBear’ in the chatroom) discloses, nothing happened over night or without a lot of hard work; however, it did happen and continues to happen! It honestly still inspires me and gets me fired up to know that by only using 30% of his account, he was able to double his ENTIRE account. This is the power of a plan and approaching this business we call trading in a logical and realistic way. Come along for a very inspirational ride! Notes: Today we interview community member Papa Bear aka Stan. Back in the 70’s, Stan saw an episode of The Brady Bunch when they had an episode about the stock market. This led to an interest that he carried until much later in life. Stan unfortunately suffered a decent loss when one of the mutual funds he was invested in got too heavily invested in a stock that plummeted. This led him to pull his funds into a Roth IRA and start controlling his money himself. After putting together as much as he could from free education, Stan had a big fear about ‘what do I not know yet.’ This led him to investigate some structured education for trading. After looking around the industry, Stan joined the University program. Stan went through the courses and decided to focus mainly on options. The big emphasis he wants listeners to take away is that position sizing is absolutely crucial in long term survival trading. He has never needed to utilize traditional margin since he is never using the entirety of his account and he has generated a fantastic return only using ⅓ of his account. He mainly focuses on candlestick formations and keeping himself involved in multiple sectors as not to be too concentrated. Quotes: Everyone and their janitor was getting in the market during the dot.com boom. I started getting scared. What is it that I don’t know is what really scared me. All these different traders trade differently. You rather eloquently showed me that I was wrong and rather than getting offended by it, I deeply appreciated it. Paper trading was good for learning mechanics. Unless you get the adrenaline of having money on the line, the lesson doesn’t stick. My first year after CTU I made 100% only using 30% of my account. We’re talking 6 figures. The last thing you ever want to do is turn a day trade into a swing trade. They are two different philosophies. Links: https://claytrader.com/videos/the-surgeons-delemma/

I have no idea what took so long, but we finally have a guest from the UK! I will say this though, it was worth the wait! As far as new trader horror stories are concerned, I’m pretty sure I have a new favorite. I had a great conversation with community member Sarah (alias in the chatroom, “like a glove”) where she openly shared her ups and downs. Like I mentioned, her one “down” is quite comical and while that makes me sound like a jerk, I promise it’s because she can laugh about it too at this point. Like many newer traders, she started out using strictly fundamental analysis in their approach to finding trades; however, Sarah quickly realized that there had to be better ways and that’s when she found the tool of technical analysis. We’ve heard it time and time again in the past, but it’s a concept that can never be overstated… as you’ll learn, Sarah’s experience with “rushing” didn’t exactly lead to great places. I had a genuinely awesome time with this discussion, and I’m confident you will too! Notes: Today we interview Sarah from the community who goes by the handle ‘like a glove.’ Her introduction to the market was getting issued stock for a company she worked for but she wasn’t very educated regarding the market. She tried to utilize as many free resources as she could to learn how to trade in the stock market and that is when she stumbled upon the Stock Trading Reality podcast, which she enjoyed since it interviewed people on their journey. She started off utilizing fundamental analysis for her trades but after taking a string of losers, she decided to invest into her technical analysis education and took Robotic Trading. It opened her eyes up to some of the foolish decisions she made in the past but gave her hope for the future. After taking a massive loss trading on delayed quotes, she decided that she needed to stop trading and really learn to take it seriously or to not participate at all. Sarah has now learned to love her losses because she keeps them much smaller than her winners. If she could go back and do it again she would have spent more time on education first and not been in such a rush. Patience has been a large focus for Sarah since she started to take trading seriously. Quotes: If he can do that, I can do that. I bought loads of books, read tons of stuff on the internet and got as much as I could for free. I did paper trade… for around 20 minutes and then I realized I was making money and I could do this! It was like a bombshell. I didn’t know what I was doing for the past 6 months. I’ve been very lucky I didn’t lose everything. I came out halfway through a meeting and lost 90% of my account. I was convinced the price was wrong. It was 15 minutes delayed. Be a lot more patient and less arrogant. And don’t call your broker and expect to talk to the manager for a refund!

While it is never planned ahead of time, once in a while throughout the course of a discussion it can turn into a coaching session. Thanks to the feedback you as listeners provide, I know many of you enjoy being a fly on the wall and observing the teaching and suggestions being made. This is exactly what happened in our conversation with longtime member Alex (same name in the chat room). He has been a member of our community for multiple years and his strong desire to succeed is what has kept him in the game this long. It’s by no means been a smooth ride, and as you’ll hear, is still a work in progress but he is finding a groove and Chezz and I were able to coach him a bit so he can keep the positive momentum going. I can confirm the momentum is still going strong and growing as this was recorded several weeks ago, and fast forwarding to present day, things are looking very bright! Notes: Today we reinterview community member Alex. He was one of the first 20 podcasts and has been a member for multiple years at this point. After a brief summary of where he came from, we dive into where he has gone since. Alex was a big buyer of options to start which means he had to focus on directional trading. Unfortunately, he was not able to do this successfully so he looked into option selling (which we cover in the Advanced Options Strategies Explained). He has been a big advocate of journaling and logging his trades in an effort to find how to improve his performance. Something we have noticed over the years is Alex’s ‘account protectionism.’ He doesn’t allow himself to take a meaningful amount of risk to generate a reward. Alex has an 88% success rate trading advanced options but that 12 % of losers have kept him from being profitable. Part of managing losing trades for this strategies is giving the trade more time but Alex emotionally closed half of those and never gave them a chance to recover. Quotes: I started to look at how Hooch successfully trades options and that is making a lot more sense to me now. I got frustrated when basic options would go my way and my gains would disappear. I was the only one stopped out on the trade example. After that, I went through Skill Sharpening again to learn to use price action. I have an 88% success rate but my p&l is red. 40 winners and 5 losers but those 5 are a doozy. Links: https://claytrader.com/podcast/episode017/

One of the biggest factors of failure in trading is created by the emotion/feeling of “make a trade”. Sure, at first it can be nerve-racking to do your first couple of trades; however, after that the floodgates of “make a trade” come out in full force. Community member Jeff (same name in the chat room) shares with us his story thus far which expands several years of time. The one underlying theme/problem throughout Jeff’s time in the markets is forcing trades and not tapping the brakes when he should be. I really appreciated his openness and candidness of sharing his mistakes, what he has learned from them and then also what he continues to struggle with. His journey is a wild ride that I want to offer some spoilers too, but I’m going to stay disciplined and keep quiet. Take some time out of your day and make sure to listen to Jeff and his story. Remember, take advantage of kind people such as Jeff who openly share their mistakes…. It’s much cheaper to learn from another’s mistakes than your own. Notes: Today we interview newer community member Jeff. His introduction to the market was a loan from a family member which led to a return of 10% on his first and only trade. This opened up his interest in the market. After having his first child, he also received 60,000 dollars which he used to go full-time trading. He made some great gains but he also took some huge losses and admits he’s blown up multiple accounts since then. This led to him taking a break from the market. Jeff hit a home run on a marijuana penny stock and that’s when he decided that he wanted to trade other instruments. He decided to invest some of his profits into his education. After stopping by the Inner Circle and seeing that penny stocks are not a focus, he joined University. He admits that he went through the courses way too fast and even though he still had some profitable trades, he was still winging it. After volunteering to be a guest on the webinars, this opened his eyes up to the fact that he needed to slow down and redo the courses. Jeff is going to attempt to paper trade or trade small until he finishes retaking the courses and is able to set up logical trade plans via the live weekly webinars that he does attend. Quotes: He gave me about 6k and saw a penny stock running so I bought 10k shares and made 600 bucks. My dad said I was a genius. They had to call down to the NYSE floor because of my order size and I made the stock move. I lost 40 grand that day. I said that this was the last time I’m going to sit there biting my nails for 3 months rolling the dice on penny stocks. I admit I went through the courses too fast but the way you explained it, it was like you were talking directly to me! You cannot read one book and learn how to trade stocks. You can’t do it. Get educated.

While our guest had always known about the market, he had a bit of a twist in the sense that everything he heard about it was negative. The cherry on top was he also had a friend who was personally affected by losing all their money in the market. Our guest from the community, Greg, realized that if he were to ever get involved in the market, he would need to focus on his education first. Unfortunately, the criteria which was taught needed a very specific criteria which led to less than 10 trades an entire year. This type of long term trading did not fit with Greg’s personality. After trimming the criteria, he started taking many trades and this led to ‘death by 1000 cuts.’ He took a small account down to practically nothing and this led him to wake up and realize for long term growth, something needs to change. Where did it all go from here? Give the interview a listen! Notes: Today we interview community member Greg. While he had always known about the market, everything he heard about it was negative. He also had a friend who was personally affected by losing all their money in the market. Greg realized that if he were to ever get involved in the market, he would need to focus on his education first. Unfortunately, the criteria which was taught needed a very specific criteria which led to less than 10 trades an entire year. This type of long term trading did not fit with Greg’s personality. After trimming the criteria, he started taking many trades and this led to ‘death by 1000 cuts.’ He took a small account down to practically nothing and this led him to wake up and realize for long term growth, something needs to change. Greg found Clay on Youtube and decided to go through the University program. His main goal is to have more time to spend with his family and while his time is limited, he always finds a way to make time for his studies. Where as most people focus on only the results, Greg has realized that in almost everything in life, focusing on the process is much more valuable and an truly lead to long lasting success. Quotes: For a majority of my adult life I had no interest in the market. Everything I heard about the market was negative. Trading is a skill set that can be learned. You’re not born a winning trader or a losing trader. Even having education, there is so much more that goes into it. I underestimated the emotional component. I’m not looking to be entertained. I really want to learn it and learn it well. I want to be able to do this. Maybe instead of a streak of green days, I can try to have a streak of days where I don’t break the rules and then celebrate. Links: https://claytrader.com/videos/stock-trading-quick-tip-math-trap/

We are going international again and bringing back a former guest. The last time we spoke with Norse was, literally, years ago (wow, has the podcast really been around that long? Time flies!). To his credit, he is still around and going strong which is a great compliment of Norse's work ethic and focus. Not many can survive the markets even a couple months let alone to multiple years! While Norse's main trading vehicle is the Forex market, please don't be too narrow sighted and think that because you don't trade or have any interest in trading Forex that the discussion won't provide value... I assure you, it does! One minor spoiler that I just have to give as it shows you how serious Norse is, but he's gone out and hired someone to work for him in an area of his trading business. It's some great stuff! Notes: Today we reinterview Norse. He’s always had knowledge of the market but wasn’t sure how he would be able to turn a profit. After going through a demo money trading challenge, he saw someone post online about 300% gains in the marijuana stocks and funded his account to go all in. Norse took a look at how much he was spending in commissions and a friend suggested he look into forex since you only pay the spread. He uses the daily chart to spot his trade ideas and then executes on the shorter term time frames. He also only focuses on a small basket of currency pairs and commodities so he really learns their ‘personality.’ He has a very set criteria for not only his entries but when to add, where to set his target and how to trail his stop loss. Norse also understands that you can do everything right in terms of preparation and execution but sometimes trades just do not work out. It doesn’t lead to any stress and he has no plans to change his system. Another important aspect of Norse’s trading is his ability to recognize his mental state. He reduces size when he is not trading well and then as he falls back into the rhythm he goes back to normal size. He still is working on avoiding taking trades out of boredom but his persistence will always prevail in terms of improvement. Going forward, Norse is working on a 15% loss reduction in his trading. He wants to design another ‘expert advisor’ to identify ranging markets and trending markets because this will determine what type of trades he should be looking for. Quotes: Penny stocks actually worked out. After taking Robotic Trading, I traded pot stocks buying support and selling resistance. I went back and did a lot of testing. I like to trade reversals because that is where my biggest edge is. I have to have certain criteria. Taking a loss on a single trade doesn’t bug me at all. If I have a red week or 2 red weeks in a row, the voices come out screaming. The holy grail in trading is just time, patience and perseverance. Nobody ever remembers the guy who gave up. Links: https://claytrader.com/podcast/episode020/

If you are not aware, you will be after reading the next sentence. There are quite a few people who approach and use the stock market as a “stay at home” Las Vegas. They believe trading is all about luck and is “a gamble”, so that’s how they conduct their trading. This of course leads to all kinds of stupidity and dumb decisions, and our guest in this episode is geared around taking advantage of these opportunities. We’ve talked with Chris a couple years ago on the podcast, but we’re bringing him back for his update. If you’ve been around the community for any amount of time, I’m sure you know him better as his chat room alias “gocubsgo”… or as I refer to him as, “cubs”. Even if you have no interest in trading options, there is still a ton to be learned in regards to what it takes to set up a strategy and system that you can have full confidence in due to its consistency. Chris has been doing very well and it’s all thanks to the system he has built himself… which, is essentially a casino to take advantage of degenerate gamblers. Let’s go! Notes: In this episode we are re-interviewing Chris. He started trading 2 years prior to this podcast and as we left off last time, Chris had just begun his journey into selling options instead of buying options. This strategy worked well for him since it is a swing traders strategy and he didn’t have time to watch the market intraday. As Chris learned more about selling options, he started to narrow down his risk profile from quite conservative to much more aggressive as time as gone on. This also leads him to not fear being assigned stock as the names he trades, he is willing to take shares of the company (most likely a good dividend stock). Keeping trade sizes small to start ensures that no big losing trade can do any real damage to his account. He is also well versed in defending losing positions using various option strategies. The big emphasis he makes is repetition is key. Chris has no desire to nail tops or bottoms but he can structure his trades to give him a much higher than 50% success rate with his usage of time (in the event he is wrong initially). For newer traders, Chris recommends using the probabilities that are built into the option chain to spot high probability setups and to swing trade instead of day trade. With time you’ll start to understand the nuances and what you are most comfortable with in terms of risk. Quotes: It’s one thing to learn the basics but when you get comfortable it’s about efficiency and small tweaks. I like finding those kinds of plays, doing them often and staying small so that you keep your account uncorrelated. The longest roll was probably a year. Fitbit didn’t have an uptick since its IPO. Be reasonable about it and don’t size up. UVXY accounts for 10% of my portfolio but it accounts for over 20% of my gains on the entire account. Links: https://claytrader.com/podcast/episode027/

As many of you know, I love me a good analogy, and in this episode we have several of them… the one that really stood out though was in regards to pitching in baseball and trading. Chris is our guest (‘thekidcanrake’ in the chat room) and he shares with us the many important lessons and realizations he has had since beginning his journey. Thanks to Chris’ grandfather, he had an early introduction to the markets; unfortunately, also thanks to his grandfather, Chris witnesses some events that shifted his mindset to the better. Even with that mindset shift though, there were still some kinks that needed to be worked out. This is the part I’m extremely happy Chris was transparent about as it shows just how sneaky the voices in our mind can be in regards to tricking us. All in all, get ready for a solid discussion on the realities of the market and trading! Notes: Today we interview community member, Chris. His initial introduction to the market was through his grandfather. He would keep an eye on the market for the purpose of monitoring his portfolio. About 20 years later, Chris started to get more involved because he had money going into a 401k every month. After watching his grandpa take a large loss during the 2008-09 meltdown, Chris decided it was time to start focusing on his education so something similar would not happen to him in the future. Since Chris is a pitcher for baseball, he saw the parallels between how emotions affected him in sports and could see the same pitfalls happening with trading. Originally he would buy into the stories that various biotech companies would tell. This would lead him to buy and hold for quite a long time but he realized he wanted to make returns faster than that (shorter term time frames). After joining the community, Chris recognized very quickly that there was a lot of things he still did not know. While he rarely jumps into anything blindly, he decided to continue trading while learning with very small amounts because he felt that he needed to have skin in the game. Chris closed all his positions and is now in savings mode to achieve his goal of joining the University program here. He owns up to the mistakes he’s made and is ready to learn and move forward. He’s taking steps in the right direction to make this a future stream of income. Quotes: I could micromanage my 401k a little bit. Trading with your emotions, you want to stay away from that. I watched quite a few Claytrader videos before I knew who he was. The ‘trade without emotion’ is what I really liked. My money was all tied up so I wanted to get involved in some shorter trades. That’s what led me here. You guys have a really good thing going on with the community. Lot of interesting and cool people. My biggest hurdle in trading will be to step back and slow down before making a decision.