The brutal honesty our guest in this interview afforded us all to hear a very cautionary tale about the very real risks that exist in the world of trading. While these risks can be controlled and navigated, when a lack of understanding enters into the "new trader equation", the numbers can turn nasty in a hurry! Mark (chatroom alias "hyprsnpr") takes us through the various loops his journey has contained, including those dirty loops that many people are afraid to talk about. Because of Mark's courage and bluntness, we all as listeners (both new and old traders) are given the opportunity to learn and have reminders shoved in our face. I don't like beating around the bush, I'd much rather have it hit me between the eyes and that's exactly what you get in Mark's journey. Notes: Today we interview community member Hyprsnpr also known as Mark. He had a roommate whose Dad was successful in trading the market. They focused only on covered calls. Another pitfall was Mark was going all in on every trade he made and when bad news came out in that stock, his account essentially went to zero. After taking a 6-7 year hiatus, Mark saved up and once again set a portion of his funds aside for trading. This led him to start getting interested in investing but after a few years of going nowhere, he eventually found Clay's youtube videos and joined the community. He flew through the courses after joining the University program and started trading before actually finishing all the courses. He found immediate success, which is a double edged sword, but eventually his over confidence led to trading a size much too large which led to a large drawdown. He decided to go back to paper trading and get back on course. Mark kept his size very realistic for practice. He knows what his comfort level is regarding trade size and wanted the transition from paper trading back to live trading to be 1:1. This is a great way to practice because your gains and losses will be the same size and your comfort should grow as you prove to yourself that you know what you are doing. What is very impressive is that Mark knows what his strengths are regarding trading. He knows his setups, he knows his time frame, and he knows his risk. This solid plan forms a foundation to keep him accountable and ensure that he only takes good entries and avoids forcing trades when there is no setup presented. Quotes: I thought there was no way out of the options unless it got exercised or expired worthless. That's how little I knew. I thought it was going to go to the moon. I watched it fall to 5c but luckily it ended up turning around. I was revenge trading. I would say, 'I lost 1000 dollars yesterday. I'm going to make that back today plus 1000 more.' The reason I like options so much is the RvR standpoint. I can buy the equivalent of 100 shares for pennies on the dollar. I still struggle with the voices every trade regarding greed and fear but I've been much more disciplined. Paper trade however long you think you need to and then multiply that by three.

Ask this episode

“What did the council decide on item 42?” — answered with the speaker and the moment.

Transcript

Related