The Stock Trading Reality Podcast

The financial services industry. One that has more than likely touched all of us in one way or another. For many people, the "touch" comes from the fact they sit down with a "financial adviser" for advise them on how to grow their money. But is their advice really in your best interest? We talk with chat room member, Danny, who has experience in this industry... and yeah, I'll just say he holds nothing back from how it all 'actually' works. We definitely talk trading too (and his journey is just as interesting as what he shares about financial advisers), but I think this interview will be a big warning to many. Notes: Danny is actually a financial planner by trade so it is safe to assume he has had an interest in the market for quite a long time. After working his way through the ranks of the bank, he eventually came to the realization that he could achieve better returns than many of these mutual funds or other products from the bank that all came with attached fees. Danny had befriended someone while traveling who apparently followed someone elses stock picks and was using his profits to travel the world. Instead of following in his friend's footsteps, he decided he wanted to learn how to trade himself so that he could be fully self reliant. Danny also knew that he would need to invest in his education if he wanted to really learn. After going through training elsewhere, Danny did not like how the teachers pushed one strategy on the students. He knew that there had to be multiple ways to view and trade the market. However, Danny now knew just enough of the basics to be dangerous so he jumped in headfirst with his 14k account. After some fast losses, that is when he found Claytrader. Danny learned how to read charts and manage risk and then took his training into the Forex market. He liked that he could trade at different hours of the day and that the market is 24 hours, so it has no closing and opening gaps. He is now paper trading and solidifying his strategy and risk management. He plans on practicing for a full year before re-entering the market with his hard earned money. Quotes: “When you work in the bank, you understand how much advisors do not know anything about the market.” “I didn’t want to be a follower. I’m the kind of guy that when I do something, I want to know everything about it.” “I got the basics. I know how to trade. I said, ‘lets go!’ I didn’t know anything about risk vs. reward.” “I’m into forex because it’s a 24 hour market. I can get home from work and still trade. I know there will be no gaps.”

Talk about a crazy start to your journey. You get a mentor and then all of a sudden he's in JAIL! Uh... yikes! Talk about a great way to become jaded towards the trading markets - and understandably so! This is exactly what happened to our fellow member from the community, Chris, as he began his journey over 18 years ago. With such an "odd" event kicking off his journey, how did he deal with it and what path did he end up on? He's been through a lot, and with that comes lots of experiencetial wisdom which he shares with us. There is something, no matter how long you've been trading, that everyone can take away from Chris' journey. Notes: Chris had a buddy who was trading stock options and this piqued his interest. This was back in 1999 and interestingly enough, the person he was studying under ended up going to prison for his shady business practices and tax avoidance. Chris still applied what was taught and was now trading directional options. Chris would focus on tech companies that he knew of. Unfortunately, he dwindled his account down to zero and had to figure out where to go from here. He recognized that options have the power to change your life with powerful gains but at the same time, the magnitude of profits can also translate into losses. After hearing about penny stocks, Chris got into the pot stock boom. To his own misfortune, he entered right at the end of the boom and got caught in the overall collapse of the sector. After running into liquidity issues as the market dried up, he decided to get back into stocks and stock options. Chris saw some of Clay’s free material and decided to join the community. With his current job though, he was unable to login during the day as the site was blocked. After about 6 months, he noticed that he really enjoyed Clay’s teaching style and decided to join Claytrader University. After going through the foundational material, Chris now focuses on a basket of stocks that have high option liquidity. He equates his trading to becoming a sniper and spotting good opportunities to enter versus his old methodology where he would just jump into a trade haphazardly. Quotes: “I put a couple grand in and had some success and thought I was pretty smart. We all know it was more luck than anything.” “I felt options were too complicated for me. I jumped into penny stocks during the marijuana stock boom.” “Penny stocks are great but you have to be in there when they are hot and heavy. You have to get in and out quickly.” “People don’t want to put the time into education and research. They just want people to pick trades for them.” “You can take all the training that’s available but you have to be able to implement it and treat it like a business, not a casino.”

Yup. It has happened yet again. The bright and shiny world of penny stocks and their apparent ability to grow small accounts punched another trader in the face. While the punch to the face knocked down our guest, AlphaThor (his alias in the chat room), it didn't knock him out. Being the mentally tough guy he is, he has gotten up from the mat and found a new way. In the markets, there is no shame in getting punched in the face, the key things that matter come from HOW you react to the punch. Notes: Alpha’s introduction to the market was a Tony Robbins book that focused on the sooner you invest, the easier it will be to retire and grow your wealth. He decided to open up an IRA account to start preparing for his retirement and decided to invest in some IPO stock that Carl Icahn was involved in. After seeing people talking about multiple 100% gainers in the penny stock world, Alpha decided to abandon his original plan and went on to trade penny stocks. He joined a few chat rooms and was unfortunately a victim of the all too common pump and dump occurrences. When his chat room subscription ran out, Alpha found lots of Clay’s free videos on Youtube and found a lot of great information from it. This led him to join the community especially considering it was a fraction of the cost compared to the other chat rooms he frequented in the past. Alpha noticed that many people in the community were trading options with a good amount of success. He decided to invest in his education and joined Claytrader University so that he could learn about technical analysis, risk management, and ultimately options. Options appealed to him and the ability to use a smaller amount of capital while also having more opportunities than what was available in the penny stock market. As he continues practicing and finding what works best for him, we’re sure that he will start to find his niche in the market and continue to grow his accounts. We’re very passionate about financial independence and have no doubt that he will be able to achieve that with his continued hard work. Quotes: “I had no knowledge about the stock market. I was just happy with that profit and decided to exit there.” “I’d figure out sooner than later that I bought the top and ended up selling into consolidation.” “I just felt I was learning more from your free content on Youtube than anywhere else so I joined the Inner Circle.” “I came to the realization that options can move just as fast as penny stocks.” “That’s why they call it a journey. I didn’t expect to be a consistent trader in less than a year.” Links: Blog: Best Online Stock Broker Video: Avoid The Pattern Day Trader Rule

For someone like myself who got started in trading after the introduction of the internet and computers, it's hard to imagine what it "used to be like" before technology really came to age. We get a great taste of that in our interview with Mike (chat room alias "TraderMike"). His journey first began back in the 1990's and over 20 years later, he's still here and improving. Mike trades full time; however, he has one of the more creative ways in which he accomplished this goal. Mike is a great asset to the community and someone who is very active in the chat room, so now you get to hear this story! Notes: Trader Mike started getting interested in the market in the ‘90s and recognized very early that he wanted to be in full control of his investments. He didn’t want to pay someone else a fee to pick stocks or funds for him. Mike utilized fundamental analysis to start his trading journey and focused primarily on what other analysts were saying. When he would find that 11/15 would agree that something was a buy, he would enter a trade. However, his exit criteria was pretty wishy washy and was much closer to throwing darts or exiting based on his feelings. After two decades, Mike delved down the path of trying to expand his education and was using more internet based newsletters for his trading. His timeframe for trades at this point was 3-6 months. While his portfolio was still trending up, he definitely got into some hot water with large losers and felt paralyzed which led him to hold. He decided that he wanted a career change and decided to dive into trading full time. Mike realized relatively quickly that now that he was trading for income, his longer term trades would not pay the bills or result in daily/weekly income. This is when he decided to investigate further into technical analysis and ultimately Claytrader University. Mike made an agreement with his wife to give him 1 year to see if his trading would work out. If not, he would go back to work. He had capital set aside for this journey so that absolutely nothing would change in their daily living. By no means did he use his family's nest egg to attempt this new career. Quotes: “I learned young that I needed to take care of my money and self invest it so I would have something to retire on.” “I was subscribing to what other people were recommending. I was using Google more to understand how stocks move.” “In the past I didn’t care if something went down for weeks but trading for income I realized I didn’t have the tools to make decisions.” “I wanted to understand and learn this so I could manage my own trade plans for the future and forever.” “I’ll watch the 2, 5, 15, and 1 hour charts to develop my trade plans.” “I like to watch the first 15 minutes evolve and then establish my trade plans based on my comfort level of what I see.” Links: Course: The Trading Freedom Pathway

Being wealthy is something we all dream of. I say this with complete confidence because I define "wealthy" a much different way than many may. To be honest though, even if you want to be wealthy in the sense of driving a Rolls Royce, there are some initial steps that you must take in order to make that dream a reality. Whether you acknowledge it or not, there is one fact that we ALL have in common... we're all a CEO. While that may not make much sense now, I promise you it will after you're done listening to this podcast. Notes: In today’s podcast, Clay and Chezz discuss personal finances and the power of a budget. The goal of this entire podcast is to help reduce your stress with a set of good habits and routines. The foundation for all wealth building, no matter what avenue you take (stock market, business ownership, etc) is going to be your budget. You are the king of your castle in the sense of you are in charge of your spending decisions. Your budget will be able to tell you what is financially responsible and what is not while helping you target your longer term goals. Another way to create peace of mind is growing a ‘rainy day fund.’ Setbacks happen in life (your car breaks, furnace stops working, unexpected medical expenses) but if you have prepared in advance for when Murphy strikes, this can alleviate your stress greatly because you were ready for whatever the world threw at you. Clay brings up a great point about choice of college and career choices. Please do the math and budget to help determine what your potential salary will be versus your college loans that you will be paying for years. More often than not, you can find a comparable school that will offer the same degree for a lower cost. The power of a budget can help you achieve your long term goals and it really is as simple as addition and subtraction. Take some steps and a hard look at your income stream versus your spending and start to be the CEO of your financial future. Quotes: “To me, wealth is the ability to sleep. If you can lay in bed at night and have no worries, that’s a beautiful thing.” “You become the CEO of your finances. We are all CEOs of our own personal life.” “Get organized with your personal finances and odds are you will have money leftover. That leftover money can be put into investments.” “It’s a list of priorities specifically. Now I always bring up is ‘is this money better on a purchase or better for the land fund?’ “ “Once you get a job, you see this sparkly new paycheck and you think ‘wow, I’ve waited so long to have money’ and I threw it around.” “How does it know it’s not in the cards? Because he has a budget. Because he’s organized. Because he’s CEO of his life.” Links: Course: Cash Flow Creation Guide Mint: https://www.mint.com/ You Need A Budget: https://www.youneedabudget.com/

We've done many interviews at this point in our podcasting journey, but thinking off the top of my head, I can only think of one other person who is taking the approach Ward (our guest and chat room member) is using. According to Ward's logic, which makes perfect sense to me, he is first focusing on developing as a person, to which he believes will then allow him to develop better as a trader. The awesome part is, Ward has a few years under his belt, so it just goes to show that it is never too late to work on oneself for the better. This was a refreshing interview and inspired me for sure. Notes: In 1998, Ward read a few books about trading but wasn’t in a financial position to put money in the market. However, the fire was lit. After getting married, his wife had her money in a mutual fund that wasn’t growing fast enough in his opinion and thought he could do a better job. He didn’t even fully realize that the market just experienced a huge downturn. Ward started to trade in stocks that had a steady uptrend. After reading 40 books about how to trade, he would still look back at his trading journal and question why exactly he entered particular stocks. He recognized he did not have a solid methodology. Unfortunately, Ward went through a cycle of trying a strategy, getting discouraged and then taking a break. This lasted for 4 years until he found Clay’s youtube videos. He thought that looking over someone's shoulder and watching them execute trades would be more beneficial than reading the theory of trading from books. Ward was actually in retirement when he discovered Clay’s videos. After seeing how well the course was structured, he went back to work for 2 months to pay for Claytrader University and to keep from having to utilize his savings for the package. At the same time, Ward discovered the power of self development and the power of a plan/goal. This ties into such a larger topic such that life isn’t all about trading. Trading is a part of Ward’s life but it is not the only thing that matters to him. Developing solid plans and planning the path to success played a crucial role in turning Ward’s trading around along with many other parts of his life. Quotes: “When I thought about trading this money, it didn’t even occur to me that the money hadn’t grown because of the market correction.” “I wasn’t losing any ground but wasn’t making any either. Even after all those books I read, none of them taught me how to trade.” “I’ve got money and read a bunch of books and think I can compete against professionals. I realized there was an education problem there.”

If there is one personality trait that is a "must have" for long term trading success, I think I'd choose: self awareness. If you are not being honest with yourself and admitting what needs to be admitted, you will spin your wheels in the mud and never improve. Chat room member, Eric, is a shining example of being self aware and using that personality trait to progress his path forward. I really enjoyed our talk with Eric as he was very passionate and energized about the markets; however, was also extremely aware of his situation too. Notes: Eric’s introduction to the market consisted of watching his father and some coworkers always checking their trading portfolios. He decided to open his own brokerage account in college with his student loans and that was how he first entered the market. He used basic fundamentals and general knowledge of what he thought would be a good stock to own to choose where he put his money. He decided to subscribe to a weekly newsletter that offered trade picks and after trading these for a while (with not much success) Eric decided to continue his search to find a system that worked for him. He struggled to find an education suite that worked for him. After college, he saved up another $3,000 to swing trade but he couldn’t put his finger on proper entry and exit criteria. After a long YouTube search for helpful info, Eric found ClayTrader and perceived him as an honest person who will shoot straight and tell it like it is. This is when he started to invest in himself via education. The beautiful thing that Eric realized is that once you have learned how to read charts and manage your risk, you are FREE to find trades on your own. You no longer need to seek a ‘guru’ for ‘hot picks.’ As Eric increased his education in terms of risk and options, Eric has found lots of success trading advanced option spreads. He can control his probability of profit and his max loss, all of which are crucial for long term success. A few members have also inspired him to stay mechanical in all his trades instead of style jumping. By no means is he saying that this is the be-all end-all and he always wins but when he is wrong, he is wrong small and it doesn’t take much to recover. Quotes: “When I was 15, my dad traded futures and used to tell me that trading in the stock market was dangerous.” “I noticed every time, what basis did I have for deciding when to buy and when to sell? There was just nothing.” “I didn’t want to go down the path of watching 1000s of videos and in the end I’m not a better trader. It was a waste of time.” “My whole life has been cycles of getting into and out of the market.” “Once you start learning you can come up with your own plays.” Links: Book: Essentialism: The Disciplined Pursuit of Less

I really enjoyed this interview because it was a change of pace (in a good way). We've had many guests who rant and rave about the power of options, which is true for sure, however our guest (minor spoiler) was not a huge fan and chose another trading opportunity: Forex (the trading of currencies). Chezz and I sit down with community member Jaime and hear all about his journey with options and why he ultimately chose to take another path. What caught his eye about Forex? How is he doing with it? We cover that and much more in this refreshing interview. Notes: Jaime’s introduction the market was a co worker who traded penny stocks. After watching him trade for some time, Jaime opened up a brokerage account to ‘dabble’ himself. His first few trades turned into investments in the hold and hope fashion. Jaime also only focused on playing the long side and avoided the short side (where he thinks the price would go down for profit). After sitting in a few tickers for a while with very little movement, Jaime wised up and decided to take a few years off before returning to the market with the goal of avoiding penny stocks. He wanted to focus on some larger names that actually had good liquidity. While Jaime began focusing on high volume options he unfortunately did not have a true risk management strategy yet. After learning about the nuances of options including the greeks, he started to realize all the things he was fighting when he first started trading them. This led him to the Forex course offered here which opened his eyes to the opportunities available for him (especially since there is no pattern day trader rules). Jaime practiced for a month before going live and has been doing very well since going live to the tune of tripling his account value. The glaring differences between his old trading and how he trades now is his outlook on risk management. Now, instead of focusing on only recouping his losses, which makes him greedy and stay in his winning trades too long, he willingly takes small losers because he knows that one winner will pay for many losers. This is the recipe for long term success and steady account growth. Quotes: “There was no strategy at all. Just going off of penny stock fundamentals which we all know is laughable.” “I was able to get out of most of my investments. For the most part, I wised up pretty quickly and decided to be done with it.” “There really was no risk mitigation or stop loss. Put some money in and it’s either going to go up or not.” “I’m at 50:1 leverage. I paper traded for a month and now trading live. I’ve done remarkably well. The chart just agrees with me.”

When it comes to just flat out being lucky, in the history of the podcast, I think we have a new winner! To give credit where credit is due, our community member, Josh, worked hard and saved up $1,000. So it is not a situation where he just lucked out in regards to having money, but yeah... I don't want to run anything, just listen - haha. After the initial luckiness, Josh quickly discovered that there is much more to trading than what he had originally thought. While he joins a long list of many who have thought this same way, the way Josh conducted himself after this realization is something we can all learn from, myself included. Notes: Josh’s introduction to the market was a virtual game and after he learned the mechanics of it was able to pad his virtual account. This led him to want to do it with actual money. After saving up $1,000, he asked his dad for some tickers on his watch list but his dad is a notoriously bad typist and ended up giving him a recommendation on something he didn’t intend. Lucky for Josh, after holding for 8 months that ticker was bought out for triple what he paid. Josh and his friend had been following the marijuana legislation in 2013 and decided to spread their money into a few different names. They had actually caught the start of the ‘pot stock boom’ and instead of holding and hoping, Josh ended up taking profits to be safe and not get caught in the dump. After finding little success in the penny stock market, he shifted his money back into larger names that he didn’t mind holding longer term. He was busy with school and life so he prefered to not sweat the small moves that stocks tend to make intraday. After watching some of Clay’s videos he decided to change brokerages and find a good platform for day trading. While Josh didn’t have a risk management plan on paper, he was extremely protective of his money and refused to let any future trades go against him by a large margin. He falls into a small percent of people who DO NOT go big and ultimately go home. Josh is now keeping himself accountable by paper trading with an Excel spreadsheet. He also realizes that less is more when it comes to indicators. Price action and volume are king. Quotes: “I figured out I was good at reading the programming of the game, make a bunch of money and get really ahead.” “We saw that legislation was coming out for marijuana. My friend and I did some research and spread our money into some penny stocks.” “I started looking into .0001 stocks. I’ve been trying to sell some of these since 2014 but liquidity trap for sure.” “I thought, oooh all IPO’s go up right? I’m going to get in and get out but I couldn’t get out quick enough.” “I stopped putting money on the line to figure out why I was unable to predict the market right.” “I used to have bollinger bands and histograms but didn’t know what any of them meant. I thought I was cool like the Youtube videos.” Links: Video: Sales Pitch or Belief

The concept is nothing new. For you longer time listeners, you've heard it time and time again... not to mention, you've probably done it yourself: make mistakes. Our guest, Thomas (alias in the chat room is "thwidra"), did exactly that, but he provides an excellent example of how traders need to blame themselves, not others, and then improve. He actually made some money at the start to, but quickly realized and admitted to himself it was pure luck and he had no idea what he was doing. Something that many new traders fail to realize (myself included when I was new!). He has had to do some reinventing of himself, but Thomas is progressing by leaps and bounds. Notes: Thomas began his trading in 2016 with mutual funds. After doing some research into the funds he had allocated, he saw that it was not increasing at an acceptable rate. After being unable to reach his advisor, he pulled out his funds and decided to take control of his money in the market. He found a site similar to iHub (message board for stocks) in Germany and after reading through the board a few times he decided to put some money into a few tickers. He admits that he got into a lucky trade which was a 100% gain but the important part is he realized this was pure luck. After some new found confidence based on his previous large winner, he started to purchase stocks while at work and then letting them sit. After reopening his broker account later in the day he saw that he was completely in the red and gave back half of his gains. Thomas did a great thing throughout all of this. He took complete responsibility and did not try to blame any external factors. Thomas learned not to put his whole account into one position and did a much better job of diversifying across multiple tickers. At this time he also found some of Clay’s stock chart analysis videos and he saw the value in technical analysis and invested in his education to be a more knowledgeable trader. After going through some courses, Thomas began to paper trade but more so in hindsight. He realized the error of this and began to paper trade realistically. As he continues through the courses he continues to paper trade and hone his craft. Finding what works best BEFORE trading real money is a real key takeaway. Quotes: “I was not looking to trade penny stocks but what I noticed is that those people were looking at stocks with a low price.” “At that time, SDRL reached its top and was falling down. It started climbing again but I thought it would break down.” “I tried to search for some sort of holy grail. I tried to find some hot stock picks. This led me back to break-even.” “It wasn’t good paper trading. I didn’t have a real plan in place. At this point I was struggling a bit with my emotions.” “At the moment I’m not that confident. I won’t go live until I have more confidence and paper trading experience.”