Transcript

Clay: This is the Stock Trading Reality podcast, episode 268.
Announcer: This is the Stock Trading Reality podcast, where you get to see the realistic side of a trader’s journey. Get inspired and stay motivated by every day, normal people who are currently on their journey to trading success. This is your host, he’s been using a weighted blanket and absolutely loves it, Clay Trader.
Clay: First, I’ve just got to say that women, they’re so thoughtful, they know how to think outside of the box. Us men, at least me, I guess I can’t speak for all men, but we’re so dense, we don’t know how to think really that creatively at all, and that’s where this whole weighted blanket thing comes from. I don’t say this in a cocky or arrogant way, but I’m happy, I’m content, if I need something, I will just go and get it. So, I’m in one of those situations where, when it comes for gifts, I don’t really need that much, I’m a pretty easy guy to please, whatever.
Clay: But then, my wife finds this weighted blanket that I had no idea that I needed. But, she somehow found it, thought oh yeah, Clay would like something like that, and she nailed it. A weighted blanket, they’re crazy. First off, whoever invented the weighted blanket, well done, nothing but respect. But yeah, it’s like this blanket that weighs, what is it, 30 pounds? I don’t know, 30 or 40 pounds I think. I’m one of those people where I like, especially up here in Michigan in those cold winter nights, when there’s some crispiness in the air, I like to just feel nice, and warm, and under all the blankets. Maybe I sound like a psychopath right now, I have no idea, but that’s just me.
Clay: Apparently my wife pays attention and she’s like, “Oh, that would give him that warm and cuddly feeling that much more.” So yeah, she got a weighted blanket for my birthday and I do, I love that thing. It is fantastic. So, if you can relate to anything I’m talking about in regards to wanting to feel warm and cuddly, especially for us Northerners, us people on the frozen tundra, I would encourage you to look. I would assume if you ran a Google search for a weighted blanket, there are things that come up. But, I’m a fan.
Clay: Then, if you have kids, you can do some fantastic games with it. My kids like to lay down, and then I try to fold it up and make it as heavy as possible, you put it on them. Then you say, “Okay, let’s see if you can escape.” They think it’s the greatest thing ever, because it is actually heavy enough. They can get up, don’t call Child Services, I’m not crushing my kid’s bones or anything with this blanket, but it’s a challenge enough where they’ve got to flex their muscles a little bit to get out, so it’s a great to, too, for the kids. But yeah, a weighted blanket, I am definitely a fan.
Clay: As for our guest today, very, very great interview, I enjoyed it, he’s a very well spoken guy. And as I’m sure you saw from the title, you might be thinking wait, what? An experienced novice, how does that work? He said it early on and I thought, hey, that’s really good, so much so that it ended up being the title of the podcast. Well, first off, his name’s David, Dave, Lahue, we cover all three. He’s a member of the community, he’s been a member for a long time, but as you’ll see he hasn’t really spoken. So, this was the first time that we’ve talked, but he has a great journey. There’s a good underlying theme that plays out throughout it all.
Clay: It really ends at a great spot. Full disclosure’s sake, it leaves at a good, solid cliffhanger where you’ll want him to come back, so he can continue to fill in the story. That’s definitely how I felt at the time. There’s a lot of good little dynamics going on, where I’m sure you’re going to be able to relate, that maybe you can learn from. I think there’s something for everybody with this discussion, so without further ado, let’s hear about David and his journey.
Clay: David, welcome to the show.
David: Hi, Clay. Thank you for having me.
Clay: You logged into our recording software, on the backend that makes this all possible, as [Lahue 00:04:09].
David: Yeah.
Clay: That caught me off guard, because usually I see the person’s first name. But, Lahue caught me off. If I may ask, who is Lahue, what is Lahue, where is this coming from?
David: Yeah, Lahue’s my code name, man. I can’t give up too many secrets.
Clay: Okay, gotcha, gotcha. Great, I’m going to end up buried in Lahue’s backyard, by tomorrow evening.
David: Yeah, this dates back all the day to high school. I’m going to end up dating myself in a little bit of my timeline here, but this dates all the way back to high school, it was a nickname I acquired from some friends of mine.
Clay: Okay.
David: That’s just where it came from, it kind of stuck. I use that in a lot of online areas.
Clay: Gotcha. Okay, that makes sense. Like I said, well done on you for throwing the code name at me right out the get go, as I guess that’s a good thing for me, to always keep me on my toes.
Clay: Well, I’ll be honest, have we talked before?
David: Nope.
Clay: Okay. Are you ever in the chatroom and participating?
David: No. I’m in the chatroom often, actually, but I don’t participate. I don’t think I’ve ever posted anything on there, and I’ve been there for a number of years.
Clay: Okay, awesome.
David: One of those guys that’s always been an observer, never been to involved in it, and I have my reasons. Obviously, it’s just the main reason is I’m probably the most experienced novice that you’ll ever find. I never feel like I know enough to be able to contribute on something, without having anything really good to say.
Clay: Fair enough. I like that, the most experienced novice. I don’t know if I’ve ever heard that term, but I might have to plagiarize that one off you in some other areas of life, that’s well put.
Clay: For listeners’ sake, this is why I love the show, this is why … We don’t get it too often, but every now and then you’ll be like, “No Clay, this is all scripted.” No, this is seriously, I’ve never talked to Dave, I’ve never even talked to him in the chat room. He did reply to an email that I sent out to the community looking for volunteers. Which reminds me, thank you very much for volunteering to be here, that makes the show go on, and makes my life much easier.
David: Yeah, sure.
Clay: So I really do appreciate that.
David: Happy to be here.
Clay: Yeah, for listeners’ sake, this could be the most awkward conversation ever, I know nothing about Dave, I don’t know his personality, his sense of humor. Other people when they come on, yeah I have an idea of them because we’ve interacted in the chat room. This could be a train wreck. Are you ready to possibly have a train wreck here, Dave?
David: Oh yeah, I’m ready.
Clay: I mean, what do you go by, David, Dave, or Lahue?
David: I go by any of them, really.
Clay: Okay, any of them? All right.
David: More recently, in my professional world, I go by David.
Clay: Okay.
David: But, Dave is fine. If Dave is easiest for you, that’s fine. [crosstalk]
Clay: I mean, I might be jumping all over the place, but as long as I know you respond to all three then I’ll have peace of mind.
David: One day I’ll get to a point where I will actually post something in the chatroom, and it’ll be under Lahue, and you’ll recognize it because there’s a UCFI [inaudible 00:07:07], unless they change it. That’ll give you an idea of where I’m located, too, Central Florida.
Clay: Nice. Isn’t UCFS Orlando area, isn’t it?
David: Yeah.
Clay: Gotcha. How is it, down there? Disney World and all that are shut down still, right?
David: Right, yeah. Yeah, they shut everything down. We have the major roadways here, I-4, that connects Tampa and Daytona areas, and it’s about a third, or maybe less, the traffic that was on there.
Clay: Wow.
David: What used to take us an hour and a half to get to the parks down there, now it could take you, I don’t know, 40 minutes.
Clay: Wow, that pretty crazy.
Clay: All right, well let’s start with the … You’ve mentioned you’ve listened to past episodes so you know where I’m headed with this, but where did this all start for you? Where did you first hear about the markets? What sort of dynamics played out that took you to the point where you made the decision, you know what? I want to get more hands on with it.
David: I’m really dating myself here, but I was a kid back in the ’70s, and ’80s in my teen years, and my grandfather had owned some stock in Kodak. Early on, back in the ’60s I guess it was, and he handed it down to my father. I think, if I remember right going back, he showed me what I thought were notes. Looking back on it now, I think he actually had paper notes, that were the actual stock itself. He had these kept away in his … I think that what they were … in his safe deposit box, but occasionally would pull them out to show them off or something, I don’t know. I don’t even know what the value was, it could have been $20 bucks, I don’t know. But, I remember that, and he was always working through his American Express financial planner.
David: I remember, as time went on into the late ’80s, and I think eventually into the early ’90s, Kodak really started not doing as well. I didn’t do the research, so I don’t know exactly what the timeline was there for Kodak, but I think it was as things started moving into the digital realm, I don’t think they followed as closely as they should have. They started a downfall, and I remember him working through his American Express planner, because I think he was managing all of his accounts, they advised him to start dumping some of that stock, and he ended up doing that, I guess. That was my introduction to stock. Into my teen years, and even into my early 20s, I remember that.
David: Beyond that, he dabbled a little bit in real estate. He bought a house in a corner of a little town. We’re originally from upstate New York, he bought a little house up there on the corner, because someone had mentioned, some friends of his thought that a grocery store was going to buy out that corner someday. So, he thought he was going to buy the house, and get rich. He ended up renting it out to a family member, and it really didn’t do well. I think he only kept it for a couple of years, and ended up selling it for minimal gain.
David: From an investment standpoint, stock standpoint, that’s where my knowledge of it really began.
Clay: Sorry. I’m always curious about people that … I don’t know if it was solely a negative experience, but was your viewpoint of the market? You had this Kodak moment, and yes, Kodak is one of the classic stories in the market, of a big, well known company that ends up disappearing.
Clay: Witnessing that in that age range, were you like, oh wow, the stock market, that’s dangerous, or that’s not for me, or that’s where you lose money? What was your connotation that you associated with the stock market at that time, after having witnessed this whole historic … At the time, you probably didn’t realize it was a historic thing, but with that whole Kodak, did that give you any sort of leeriness towards the markets?
David: Oh, definitely. It definitely did. That, coupled with 1987, the crash in, I think it was ’87. Actually, it was late 1987 when I entered the military as well, so that’s the year I graduated high school. Again, like I said, I was going to end up dating myself on the timeline. We had that, Kodak, my dad’s adventure with real estate and some other things.
David: That was my opinion of investment, and finance, the stock market, was that it was very volatile, it was very challenging. But, there was something about it that always stuck with me. There’s an unknown here, because the flip side to this there are a lot of people that are very successful in this, but I didn’t know how. I had too many other things going on.
David: Entering my 20s, and realizing that I had other more important things to chase, like women, and booze, and things like that.
Clay: I wasn’t going to say it, I wasn’t going to put any words in your mouth. But, a 20 year old guy, I’ve never heard of that before.
David: Right. I wasn’t too focused on it. Then, after getting out of the military, started focusing on education, and career, and family then, as things went on. But, I’m going a little ahead of myself.
David: When I was in the military, I remember also, I think it was 1988, I had a girlfriend down in Tampa area. She had, no kidding … My girlfriend, it was her cousin, they were roommates. Her cousin’s boyfriend drove a brand new Nissan 300ZX. Of course, here I am, early 20s or late teens, whatever it was, and I remember this car, this amazing car this guy had. He was, I don’t know, mid to late 20s. I’m like, “What does this guy do? He’s home all the time, he’s not going to work.” I thought the guy was a drug dealer or something. I’m like, “What does this guy do?”
David: Come to find out, he was a trader, he was a day trader. That’s what they told me, I didn’t verify it, but that’s what they claim that he did. But, I never really talked to him much. Whenever I would try to ask him something, he would try to explain things but it was in trader’s terms, which I had no idea what he was talking about. Then, eventually we went our separate ways, but that always stuck in my mind. Okay, I’ve seen the bad, back earlier on, and now I’ve seen some success. Or, the results anyways.
David: But didn’t really know how, and when to get into this, and didn’t know how much money I was going to need to get into it. I always thought it was a rich man’s sport, so I never really took it too seriously. Anyways, that’s what happened there. How do you want to do this? You want to just keep going down in this timeline?
Clay: No, this was fascinating. It sounds like you developed a healthy respect for the markets, because you mentioned while the stock market’s very volatile, while it can be very crazy, but I didn’t hear the words, “Oh wow, the stock market is rigged against me.” Or, “Oh wow, the stock market is purely manipulated.” It doesn’t sound like you had any sort of views like that, it sounds like you just had a healthy respect for it. Like okay, there’s definitely something there for potential, but there’s also something there, where if you don’t treat it with respect because of all the volatility, it can definitely punch you in the face.
David: Right.
Clay: Would a healthy respect, would that be a good way to describe your initial approach to it?
David: Yeah, it did. I think that’s a good description. There was a healthy respect, there was a nervousness, there was anxiety early on. But, at the same time, I was young enough that I also didn’t care. I looked at it and thought, I don’t need that. It would be fun to look into, but maybe at a later date.
Clay: I was going to say, one of those where eventually creeps into the picture. Like, yeah that looks great, eventually I’ll get to it.
David: Right.
Clay: Yeah, I can see that. I don’t want to speak for you, Dave, but I bet you would tell a 20 year old, though, “No, no, no, I get it, I was there, I did the same thing. But please …” Not necessarily get into day trading or anything like that, but get involved in the stock market right now, and start investing, right now. Would you agree? Would you tell a 20 year old, an 18 year old that right now, though, looking back?
David: No. I would tell them, education is the key. Even if it was only a few months of learning the basics, I would say education is really the key to understanding what you want, where you want to go. Now, trying to get somebody to stick to that plan, and move forward with that process, it’s a little more challenging, especially for a 20 year old. If they’re in the same position that I was back then, they had too many other things going on.
David: You can take a couple hundred dollars, or $50 bucks, or whatever it was, and just throw it in, and see what happens, and you can learn a lot from doing that as well. That could be a part of the education process, if you’re willing to part with it. Always part with the money that you don’t need.
Clay: At the core though, it sounds like we agree. Whether that be education, or just at least putting some money in, I don’t know, buy some Coke, buy some Pepsi, buy some Microsoft.
David: Yeah.
Clay: Just start to get involved now rather than later, because …
David: Yeah, that’s exactly my point. Whatever the process you’re going to use for education, … There are so many platforms out there now that have a lot of education. I use TD Ameritrade, and it’s built in with that, there’s a lot of good stuff. Even in your stuff that I’ve been using more heavily now, is invaluable. There’s so much information out there. But, a 20 year old may not have that kind of money lying around right now to be able to start that, I didn’t when I first started which was the only reason I waited.
David: You can open an account for nothing now, I think. Most places will do it for free, and cancel.
Clay: Well, I would counter argue you with saying yeah, but now your experience compared to these days is apples and oranges because in your days, … Not that I’m saying that like you’re some sort of stone age old man, but E-Trade was probably still, what? $10 bucks to buy, $10 bucks to sell?
David: I lost a lot of money in fees.
Clay: For you new people out there, yes, not that long ago … maybe I’m dating myself here, but yes, I vividly … In fact, I have a video on YouTube from three years ago where I’m not calling E-Trade a scam, but I’m just talking about this is crazy, $10 bucks to buy, $10 bucks to sell. It sounds like madness now, in this new day and age of, basically, zero commissions for most brokers. I do understand where you’re coming from, because yeah, it does still take money to make money and all that, but the barrier to entry is definitely apples and oranges now, when you have this environment.
Clay: Not only that, but partial shares. Well, I only have $50 bucks, that’s not an excuse. You can go and buy a fourth of a share of Microsoft, or Amazon, or Tesla if you want.
David: Right.
Clay: Partial shares that’s just a norm now, too, which I’m assuming wasn’t really around back then. But, at the core, we both agree, don’t be like us where you’re like, “No, no, I’ll get to that eventually.” No, just stop and think about it, and hopefully they pursue.
Clay: I would assume, though, that if a 17 year old, or 18 year old, or 20 year old is actually listening to us right now, David, they’re probably already on board. So, maybe we’re just preaching to the choir at this point, but anyways, we’re both in an agreement there.
Clay: All right, well you went through college like you said. If you want to go back on touch on anything, feel free to do that. But, it sounds like you didn’t really circle back to this stuff until later on? I don’t know if you were still in the military or career, but I guess, when did the market finally come back into the picture for you?
David: Well, I think it was 1999. It was like Tommy Boy, I was one of those guys who took seven years to complete my bachelor’s degree.
Clay: What did you get your degree in?
David: Engineering, actually. I started at a junior college and did it part time, and that’s the only reason why. I wasn’t at one school, and jumped around with a bunch of different majors.
Clay: Nice.
David: It was started at a junior college.
Clay: What kind of engineering degree?
David: It was actually an electrical and mechanical engineers, combined.
Clay: Oh my goodness, electrical? Whew, brutal.
David: Electrical and mechanical.
Clay: Wait. You’re a dual major, then?
David: Well, no, no, no. Electrical mechanical engineering technology, so it’s an engineering technology degree, which they don’t offer anymore.
Clay: Okay.
David: The only real difference was, back then, I think the difference was with the level of math. I didn’t have to take …
Clay: I think, isn’t technology when it’s more hands on stuff?
David: Yeah. Yeah, it was …
Clay: Then, engineering, just engineering is like, no, we’re going to keep you in the text books, and talk more in theory, of numbers.
David: Yeah, that’s exactly it.
Clay: Yeah.
David: Yeah, you have kind of a similar background. Don’t you have an engineering degree?
Clay: I do have an engineering degree. But, I do remember when I was trying to figure things out, the difference between engineering technology and then engineering is engineers, yes, you get an official engineering degree, but engineer technology, but that’s more practical, hands-on type stuff.
David: Right.
Clay: Like you said, engineer, where I was, a lot more math heavy, which I still don’t understand why I ever had to learn about differential equations. I never used those once. Maybe to get me to learn how to think in a way, but I have no idea. All I remember is, I’m pretty sure I’m not going to be launching rockets into space.
David: Well, we’re here in Central Florida, so there was a good chance that we could be.
Clay: Yeah, there you go. NASA’s down there, and everything else.
David: Anyway, it was ’99, that’s when I graduated, actually, from UCF. I started working, it was a co-op, for a major industrial manufacturer. The Dot Com bull was in full swing, so that’s when I opened my first account, and it was E-Trade.
Clay: What were your commissions back then, do you remember?
David: Well, here’s what happened. I never actually traded with them with real money. The first thing I did was … They had a paper trade. Going back, trying to think back exactly how it laid out, but you could paper trade stock and options, they had this paper trading platform right up front. They were advertising, learn how to trade options or something, I can’t remember exactly how it was laid out. But, it drew me to that, where they give you $100,000 in learn the markets. That’s what I did, I opened an E-Trade account primarily just for that.
David: This was the craziest thing, and this was what really triggered me into moving forward, was not knowing anything about stocks, how to trade, options, I knew nothing about any of that, I was just basically pushing buttons. With this $100,000, within the first couple of days, … I don’t know, I set up an option trade, I guess, and I had no idea how I did it but I did it, and I ended up making, I don’t know, it was over $100,000 in just a few days. I don’t remember what stock I was trading, I was playing, just trying to learn the buttons. I turns out that I was ranked number three for the month.
Clay: Nice.
David: As their options trader, so my name, I think I even used Lahue back then, was listed there as third ranked for the month, whatever month it was in ’99. All I kept doing was, I was watching this, and I was showing some friends of mine, “Look how good I am at this, and I don’t even know what I’m doing.”
Clay: The most fascinating part I heard was you set up an options trade, but then you made the comment about, “I don’t even know really how I did that.”
David: I didn’t, yeah.
Clay: Literally, you set up a trade that you didn’t even know how you set it up, and all of a sudden, boom, you’re ranked number three, that’s pretty crazy.
David: Yeah, and I didn’t know how to get out. I figured out how to get in, didn’t know how to get out, and I just watched it. Then, it all just disappeared, it was gone within, I don’t know, maybe a week, less than a week. I don’t know, but within three days, I made a ton of money, was ranked third on their site, I was happy, excited. There wasn’t even a learning experience, so I couldn’t even be too excited because I was smart enough to know that I didn’t know how this happened.
David: It didn’t trigger me to go in and just start playing with real money, I knew that there was a lot more to this. That even emboldened me more, to get more into the education side of this because I knew it wasn’t that easy. I’m a little bit of a risk taker, always have been, so I was willing to learn a little bit more, and I’ve always wanted to get into options, but I’m not even there yet.
David: That’s where my whole trading platform started, it started with trading options that I knew nothing about, and made a lot of money, and then lost it all.
Clay: Well, good for you in the sense of acknowledging the fact that I don’t know what I’m doing. Way too many people, over and over again … Maybe if you’re new to the podcast, I’ve been doing the podcast, I think, since 2015, ClayTrader.com’s been around since 2013. So, I’ve heard over and over again, people pretty much do something like Dave where they make a bunch of money, but then you talk to them, or they’re talking to you, and you just sit back and listen. You’re saying, “Yeah, this person has no idea how they made that money, they have no idea what they actually did.” But, the problem is, this person thinks that they’re actually skilled right now.
Clay: You try to tell that person, “Oh whatever, you hater. Oh, you’re just jealous.” It’s like, no, that’s not the case. I’m glad that you just had the lack of ego to look in the mirror and be like, “Wow, rank number three, but I don’t even know how I did that. I need to learn more.” So, props to you for that, because I’ve seen … in fact, we’ve had plenty of past guests that have done the exact opposite. I’m not calling those people stupid because I understand, it is somewhat logical to think oh wow, I’m having success, I know what I’m doing. But, that’s also the cruel part of the market, is the market can give you success even if you have no idea what you’re doing, and then it’ll just punch you in the face with a sledgehammer.
Clay: Well, you got yourself rank number three, you watched it all disappear. You thought, okay, all right, I’m fascinated but I realize I don’t know what I’m doing. So, where did things go from that point?
David: There was a long lull, a good few years after that, we got busy with work, and I’m trying to develop my career because I’m just out of school by a couple of years. So, working for a manufacturer, you work a lot. I was working as a manufacturing engineer, I worked as a production supervisor, I even worked on the business side in marketing, so I was expanding my horizons by quite a bit, really learning as much as I could about the company. That’s where all my focus was going. Plus, we were starting a family, so there was just too much going on. I didn’t have a lot of additional funds to really get into stocks again, so it was delayed.
David: In 2006, I think it was, I had started with a different company. It was a smaller company, I had a little more time on my hands on occasion, my breaks maybe went from eight minutes to 12 minute or something. I would use that extra time to check out stocks again, so I got a little more involved. Then, that’s when I actually opened, I think it was the TD account, the TD Ameritrade account, was in 2006 I think it was. Penny stocks, that’s where I started.
David: Well okay, at this point, I’ve done a little bit of work, I’ve done a little research. I think, TD back then had three or four different platforms that you could trade off of. They had one that was a totally separate platform, that is what is now their go-to platform which is the Think or Swim. But, back then they had an online version that you could use, and I really liked that platform, I forget the name of it. That was one that I started using, because I could load it up on the computer anywhere, and it would just run, and it showed me everything I wanted to see, which was the very basics. I didn’t know what any of the technical side of it was, still, at that point.
David: By this time, I’m just looking at, with some engineering training, I’m looking at graphs and trends. That’s what it came natural for me, to look at a graph and get an understanding of the general direction, without knowing all of the different symbols, and all of the different readings, and what they’re called, and all that. It was just basically looking at it, and getting an idea of what was happening. It’s trending up, it’s trending down, straight across, but I didn’t know what a doji was, I didn’t know what a candlestick candle was, I didn’t know any of that back then. So, I really hadn’t started anything, but I knew enough that if I take $50 bucks, and threw it into the account, even with my $12 fee, because it was a $12 charge …
Clay: I was going to ask, what was TD Ameritrade back then?
David: I think it was $12 bucks.
Clay: That sounds right.
David: That’s the number that’s stuck in my head.
David: I have $50, and it’s $12 to buy and sell, so I’m thinking, okay, I want to make at least $20 bucks off this stock, if I’m throwing $50 in there, because $24 of it is going to fees. Oh jeez, come on! What’s the point to this?
David: I throw some money, I bought my first stock back then, I don’t remember what it was. It turns out that a couple of penny stocks, I just got lucky. I think I ended up making, I don’t know, maybe $100 bucks or something in total for the year, because I lost a lot, too. Again, that was knowing nothing. I was told back then about my first books. I went to Barnes and Noble, my wife and I would go there once in a while, and I’d just walk around in the stock area, and I found Getting Started In Stocks, and then Swing Trading. I’m like oh, what is swing trading?
David: I had heard that term before, but I didn’t really know what it was. I’m thinking okay, I’m working full-time, in a “regular job,” and then that’s when I realized, okay, swing trading sounds like it’s more along my lines. Find something at a good point, at a good entry point, and just let it sit for a few days, or a couple of weeks, and then see what you make. But, I didn’t have the time to sit down and monitor, I wasn’t able to sit down and actually see how things were moving, and still didn’t understand it. I thought well, swing trading would give me the opportunity to do this, without having to understand all of the technical behind it because I don’t need to worry about it.
David: If I know when to enter, I know when to get out. I can just monitor it minimally, and be able to do that. That was my mind sense back then, was just from my interpretation of what these charts meant. Seriously, I knew nothing about all of the technical.
Clay: You’re using a line chart, right?
David: Yeah, it was a simple line chart.
Clay: Right, right.
David: [inaudible 00:31:57].
Clay: I’m always fascinated in penny stocks, but it sounds like … I don’t want to speak for you, but you probably did penny stocks because of the whole commission thing. If you only put in $50 bucks and you’re doing the math, well, wow, I’ve got to make at least $24 because it’s cost me $12 bucks to buy, it cost me $12 to sell. I only have $50, so what I can afford that I think can move big? Is that, essentially, what forced you into penny stocks then?
David: Yeah. It was playing. I didn’t understand, I didn’t know what classified a penny stock other than … I thought it was a penny or less, I didn’t realize it was anything, basically, under a dollar. It didn’t matter at that time, I had little discretionary funds, $100 bucks here, $100 bucks there. I’d throw $50 in the market once in a while, but 95% of the time I lost it all.
David: I knew, over the course of time, that there’s something I’m really missing. I can’t just say, okay, this has got to be the bottom by what I’m seeing in the trends, it looks like it’s turning. Then, I would just throw some money in, just from looking at it, and spending all of 30 seconds on looking at the chart and say, “Okay, I’ll buy this.” I’d click buy, and I’m all happy I bought a stock. “I’m a stock owner.”
Clay: Especially with penny stocks. If you’re doing them below a penny, then you can walk around, “Yeah, I own 300,000 shares of a company.”
David: I know, right? Yeah.
Clay: Yeah, I remember those days. Yeah, it’s pretty cool.
David: I know you do, because I’m leading into something here.
Clay: Uh-oh.
David: Yeah. No, no, it’s good stuff, it’s good stuff. I’m sure you’ll enjoy this.
David: Eventually, we’re going to get into iHub here, because that’s …
Clay: Okay. Well, keep on going, Dave. This took a turn for the best, right here.
David: I thought this might be a little more entertaining for you.
David: You’d think a guy with an engineering degree … It’s not a full fledged engineering degree. I know you, as an engineer, probably look at the technologist as like, okay, he’s just a technologist, I know how you engineers are.
Clay: No, I think they’re the better ones because they’re the ones that got their hands dirty and stuff. We sit with our white gloves at our keyboards, so no, nothing but respect from me.
David: Anyways, I ended up getting out, moved back into the company that I started with after getting out of school, I ended up going back to them. This was around, let’s see, 2007, and the markets were in full swing again. But, we were so busy with our company that I wasn’t able to do anything.
David: So it was 2009 and ’10, somewhere around there, the bubble burst again, the real estate bubble happened, and the markets came crashing down. Our whole business changed then, and a lot of frustration, a lot of restructuring. By 2011, with my personal frustration with the way things were going professionally led me to look at the markets again, and realized at that point, I really need to … I was getting a little older, and I realized I needed to start looking a little deeper into this because I didn’t really have any trust investments outside my 401K. I had a fairly decent 401K, I’ve always made sure to match that out as much as I could. Well, not the total max that you’re allowed, the max that our company would match.
David: At that point, I’m starting to look more into education. I’m Googling, I’m Googling all this information on stocks. I wasn’t really involved with YouTube back then, I don’t even know how much was on YouTube. But, I came across the iHub in 2011. Oh, I look back on that and I just shake my head.
Clay: Hey man, welcome to the shake your head club, I’m the president of it.
David: It was at that point, in 2011, and I’m so embarrassed to say this, is when I “fell in love” with my first stock. It was QSGI.
Clay: QSGI.
David: QSGI, and it became QSGIQ because they went into bankruptcy, I think, was what brought that last Q on, I think.
Clay: Yeah, the Q is you’re having some problems as a company, I’ll just put it that way.
David: Right, right. It was a penny stock. There was this one guy on iHub, I’m sure you’ve heard of him. I don’t know, maybe he’s a good guy and a good trader, I don’t know. He was the one that was leading the push behind QSIGQ because they were in bankruptcy proceedings, and their stock was valued at, I don’t know, three digits to the right of the decimal point or something, or maybe more, I don’t know. Can I say his name? I don’t know if it matters.
Clay: We better not. Yeah, we better not. At the end of the day, the name isn’t what matters.
David: It doesn’t matter.
Clay: But, what Dave’s going to describe, that’s what matters.
David: It’s true.
Clay: The boilerplate that Dave lays down, this is much more powerful than knowing a name. A name can always disappear, but the tendencies are not going to disappear, the habits, the way they behave. It sounds like this guy was a total pumper. Pumpers are going to always behave like this, so don’t worry about names. Worry about, okay, how does a pumper actually conduct themselves? Which, I’m assuming, is what you’re staring to describe, here.
David: Yeah. The idea was that there was a date that was picked out in which this company was scheduled to come out of bankruptcy. They had all these filings, and then all this talk. Daily, there was hundreds and hundreds of comments on the stock page. This went on for, I don’t know, six weeks or something, building up to this time in which it was supposed to come out of bankruptcy.
David: As it was building and building, of course the stock price was increasing. I had put in, I don’t know, I think I had close to $800 that I had thrown into this penny stock, thinking that this thing was going to go to the moon. This thing was going to make me a gajillionaire.
David: To only enforce that idea, somewhere around this same time, there was another stock that actually went through a reverse merger. I don’t remember the stock, the ticker symbol, but I remember jumping on and seeing it was worth much less than a penny, all the way up to, they closed the end of day at $7, over $7 a share. It’s listed on the iHub Exchange as one of the top performing reverse merger stocks ever, I guess. But I watched it, that whole day I watched this thing increase. I’m thinking, is this really possible? Does this really happen? Of course, because I’m witnessing it I’m thinking, well, this must be fairly common. Then, at the same time, I’ve got my QSGIQ, that is building, and building, but in much smaller increments, just because of the hype.
David: The day finally comes. We’re all thinking as soon as this thing emerges from bankruptcy, this thing’s just going to take off. It got up to, I don’t know, for sake of conversation, I don’t even know if it got up to a full penny. The day came, and it did nothing. I let it go for a few days, and it slowly started coming back, and I made maybe $200 off the whole thing. Like I said, it was $800 or $900 into it, by buying different spots as it was increasing.
David: But, it turned into the biggest let down I’d ever had, and I knew that, at that point … Again, another learning experience. Something just wasn’t right, but there were people on iHub that were making plans … This company, I guess, was a Miami based company or some place, or that’s where the filings were being done. People were talking about going there to support the filing, and actually walking to talk to these people, to some of the management teams. “I know this person, and that person within the company.” It was just crazy.
Clay: I mean, for listeners’ sake … actually, if you’re listening to the archive, we’re in the quarantine right now, with the Coronavirus. Whether or not you’re in quarantine or not, if you just need some real life hilariousity, and just need some good, real entertainment, hit up iHub.
David: Oh, yeah.
Clay: Pick a message board from, really, any time frame, and then just go back to post one, and start reading. You will see some crazy, crazy stuff.
David: Unbelievable.
Clay: I want to be shocked when I hear you say, “Yeah, people were going to go to support the filings.” I don’t even know what that means, but I’m not shocked to hear it at all. That sounds about right, I can see people wanting to go down there, and hooray, whatever going on from a paperwork perspective.
David: I was not one of those people.
Clay: I was just going to ask you that. I was going to say, Dave, be honest, but okay, you preemptively …
David: No.
Clay: Fair enough, I trust you.
David: I, from the sideline, was watching, and listening. It didn’t take long for me to realize that the whole thing was just kind of a scam. There was nothing to gain out of this, there was someone obviously behind pumping this stock. That’s when I learned, also, that it’s all about the hype and the buildup. Then, once the date actually happens, regardless of what date it is we’re talking about, when the activity actually happens that’s supposed to happen, that’s when things usually fall apart.
David: I learned a lot of valuable lessons in that short timeframe. Don’t ever fall in love with a stock, you can’t ever do that. If you want to invest in a good company, invest in a good company, but this is just junk. I learned the hard way on that, and lost some money. Actually, like I said, I made a few bucks but overall I think I lost a lot more.
David: I think I traded it twice, because I think I traded it before and after bankruptcy. Yeah, that’s what it was. I lost all of it when it was in Q status, and then when it came out … I don’t remember. I remember, overall, losing I think $600 or $800 on that whole mess.
Clay: Yeah. I mean, I can barely remember the trades I took two days ago, so I understand if you can’t remember all the details of something from, basically, eight years ago.
Clay: What eventually pulled you out of this penny stock funk, where you had to just look in the mirror and say, I feel like I need to change something up? Where did you go, at that point? It sounds like you’re getting close to really realizing something’s just not right.
David: Yeah, yeah. By this time, let’s say 2012 to 2015, minimal trading. I’m learning the markets a little more, I’m throwing $50 bucks in here, and $50 bucks in there. Then, it was 2015, ’16 time frame, is when I found this awesome dude, Clay Trader.
Clay: I mean, I heard he’s a scumbag, but that’s whatever.
David: But, you know where I found him? Was on iHub. This was the craziest thing.
David: I got back into iHub again, because it’d been four years. I’m like ah, I’ll just jump back on here and see what’s going on. Then, I see this guy, Clay Trader, and notice this dude’s got this huge following, and he’s ranked number one with followers. You had some comments on there, too, I don’t know, one of your links or something.
Clay: Yeah. I’ve had so many links over the years. What you’re describing, I’m confident, is more than accurate.
David: Yeah. Anyways, that’s what got me interested in it, so I went and looked at some of your videos. You had some free videos up there, on YouTube. It was good, it was informational, it was educational. You hit that sweet spot, you knew your target audience from iHub. You knew that there were people out there like me, that wanted to get into trading, just didn’t know how, had some bad experiences, and you just fit it to a T, you hit your target audience perfectly. I think I fell into that grouping of people, there.
Clay: Almost like I’ve been through the exact same thing. You know, if I just talk to myself here, I think I might not be alone.
David: Right, right.
David: Let’s see, it was 2017 all the way up to last year, 2019, I dropped off again, but I was always involved a little bit. Throwing a few bucks here and there, minimal research, but still had not done … Here we are, I span 25 years of being in and out of the markets, having some access to them, and opportunities where I could have spent some time learning about it but I didn’t, I passed up the opportunity to learn.
David: Here I am now, 2020, and late last year and earlier this year is when I realized, okay, I hit a milestone with my age. My family, my kids are growing up now, my oldest son is getting ready to leave for college. My daughter, she’s a freshman in high school. So, I’ve got a little bit of time here and there now, I’m not as active with them as I used to be, and I realized okay, I think I’m at a point now where I really need to think about how I’m going to plan out my retirement, investments. I really, really enjoy the trading portion of this, this has always stuck with me.
David: Why I keep coming back to it is that there’s something so … Maybe this is the passion thing that you refer to quite often, there’s something in the blood that’s just like, okay, I need some excitement. I’m not risk averse, I enjoy a little bit of risk once in a while. I’m missing one key element, though, and that’s the education portion of this, that’s the I still don’t know what I’m doing.
David: I started your chatroom, I think three years ago or something, back in 2016 or 2017.
Clay: You’ve been a member for that long?
David: Yeah.
Clay: Man, we’ve never talked. Good stuff.
David: Yeah, it’s been a while.
Clay: I think that has got to be some sort of record, talking with someone that’s been a member for years. Honestly, I probably didn’t even know you existed, if we’d never spoken at all.
David: No, you probably didn’t. No, never have.
David: I’ve dealt with, I think it was Nate, or somebody else. I had a problem with the account once, just going through … I don’t remember exactly what the problem was, it was probably something with your website. I got charged, or double charged, I don’t know. He fixed it right away, it was no big deal.
David: Then, I dropped out, and then I came back in, and was paying a fee. There was a lot of valuable information in your chats. That’s when I got to know some of the other people, just from following, and you realize who really knew what they were talking about, who the people where that you dealt with on a daily basis.
David: Then, you started up your meetups, you were putting together these meetup things. You had one in Florida I think, right?
Clay: We did, Fort Lauderdale.
David: Yeah. I remember seeing that and I’m thinking, this would be a good opportunity for me to just do this, and finally jump in. I don’t know, I don’t remember exactly how the whole thing went down, but I eventually didn’t do it. I had something else going on, and elected not to do it.
David: I think a part of it is, still, the lack of education, and lack of knowledge on how this whole thing worked. There’s a lot of anxiety on my part, from when I don’t know. I know the people are very friendly in the group, and they’ll help with knowledge, I see I every day. It looks like you have new people in the chatroom every day, and the guidance, and the way people take everyone under their arms, and try to help them out is just amazing. That’s part of the reason why I stay, and I keep coming back to it. But, I’ve never felt I’ve had anything of great value to share. That, plus time.
David: So, here we are today, 2020, I still have my full-time job which keeps me extremely busy. But, I’m trying to get more involved with the education. I did it, I joined your pay as you go plan thing, what is it, a few dollars?
Clay: Pay what you want.
David: Pay what you want, yeah. Yeah. I noticed that was new, because I went away for a little bit and came back again, and that’s when I see you changed it up again. But, I understand the value of the cost of the program, because after taking your first class, the robotic training, this has been invaluable to me. Learning the technical side of the charts, I can’t believe I waited this long because I love it. It’s addictive.
Clay: For my context’s sake, what payment have you done? Just the first one so far?
David: Just the first one.
Clay: Okay.
David: Yeah, just the first one.
Clay: For listeners’ sake, and it’ll sound like a plug but it’s not, just to set up reference, if you don’t want to do the entire program, there is a pay what you want plan. It’s called Pay When You Want because it’s not like a monthly payment, because with each payment you make, you just get a class. That way, you go through the class at your own pace, and whenever you’re ready to get the next class, well then you make the next payment. That could be a week later, or it could be two months later.
Clay: My main goal is just for people to learn, with no pressures of, oh great, now I’ve got a monthly payment, oh great. With this way, you can just go as fast or as slow as you want. That’s why I wanted to ask, just so I can see, actually, where he’s at within the education. But, you’re just on the first class.
Clay: It’s crazy, isn’t it? I’ve heard that time and time again, where people are like, “Oh wow, why did I wait so long to just start to learn about this stuff, and all the nitty gritty details?” There is a lot to it, isn’t there?
David: Oh yeah. I mean, it’s fantastic, the way you’ve laid it all out, step by step, video after video. It just builds on the one previously, it’s a great program, it really is. I enjoy it. I love the way you present it, it’s very personal, one on one kind of program, but it’s organized. It’s well laid out, it helps you really understand what it is you’re talking about, the way you set it up. Nothing but props to that.
David: I think I’ve learned more in the past month that I’ve had access to that, I think than I have in the past 20 years, seriously. Part of it, I know it’s because I’ve taken the steps, I’ve taken the right steps to invest in the education part of this, which I’ve never done before. Other than reading a little bit, up on TD Ameritrade, but it’s generic in there. I hadn’t found anything that goes into the level of depth that you have.
Clay: Not to bash free education, because I know that’s not what you’re doing, that’s not what I want to do. Even today, I was going through YouTube comments and somebody said, “Yeah, I’ve watched over 400 YouTube videos, and I’ve read 10 books.” Good on that person, I’m not ragging on that person’s work ethic. But, all I can sit back and say is, wow that person’s got to be overwhelmed.
Clay: Let’s just assume that all 400 videos was actually valid information. Here’s the hint, there is a lot of garbage on YouTube, where it’s not good information that you’re consuming. But, we’ll just give this person the benefit of the doubt, and assume that all 400 videos was actually valid information. I mean, 400 videos? That person has got to be just swimming in a sea of being overwhelmed.
Clay: So, I can’t say that I’m shocked to hear that you’ve learned more through this one class than you have in 20 years, because that’s just the power … As an engineer, you appreciate the power behind condensing information in a structured way, and in a sequential way that all of a sudden, okay wow, we can work a lot more efficiently here. That is engineering at the core, right?
David: Right, it sure is.
Clay: It’s almost like I have an engineering degree, and that was drilled into my mind during school, is to make things as efficient as possible.
David: Right, right. Actually, that was my direction in my career, I went down the whole Kaizen and continuous improvement path.
Clay: Yeah, as a manufacturing engineer, you are literally paid to make things as efficient as possible.
David: Exactly, yeah. I moved away from calculus and into statistics, and fell in love with that. I never thought of it that way, but yeah, you’re right. That whole part of it may have been part of the building blocks, that was led me down this path and why I enjoy it so much.
Clay: It sounds like you have some entrepreneurship in your blood, anyways.
David: Really, you heard that out of my voice? Because it’s true, yeah.
Clay: No, I heard it with your trying to make money off a grocery store on the corner lot of a piece of real estate, and Kodak, and all that. It sounds like you’ve got some DNA.
David: That was my dad. Yeah, yeah.
Clay: You’ve got some entrepreneurship.
David: My grandfather owned a hardware store actually, years ago.
Clay: See? I’m telling you, that’s what’s pulling you back. A lot of people, they don’t realize that when you get into trading, you are an entrepreneur. This is a business, and I get that a lot of people don’t treat trading like a business, they treat it like a casino. But, if you want to have success, if you want to do it the right way, you need to treat this as a business venture. When you are building a business, that’s what an entrepreneur does.
Clay: Yeah, it doesn’t shock me at all to hear that, over the time span of 20 years, you just kept getting pulled back into, there was a little magnet. You’ve got some entrepreneurship DNA in you, so it makes sense.
David: Yeah. I ran a business, a site, an online business for a while.
Clay: See?
David: Kind of a consultant site, and it was actually fairly successful early on. But, it was supposed to be one of those passive income kind of deals, there was no way it was passive. That was a load of crap, there’s nothing passive about an online business. It very quickly became incredibly involved, and I realized I had to make a choice. It was either jump off … I worked for a great company, and I’m honored and extremely happy with the way my life has gone so far with this job, and I’m happy with working for them.
David: There have been points in my life, lower points, where I’ve been like, I want something on my own. That’s there that whole entrepreneurial part of it always came in. Yeah, I think I said entrepreneurial, is that the right word? I think it is.
Clay: I think so. I know what you’re talking about, so as far as I’m concerned it’s the right word.
David: Yeah, it’s been there. But, I ended up having to back away from that because it just took up too much time. Then, the more I started to evaluate what it is I wanted to do with my life I realized, okay, I can’t get rid of my primary money maker. It gives me my insurance for the family, and I make a good wage, a good living with this job, and I enjoy it. I’ve grown within the company, and I think I’m well respected within the company now.
David: At the same time, this is mine. This has become, like you said, the entrepreneurial part of me, I think this is the right target, the right focus, is trading. I don’t think I’ll ever be a day trader until after I retire, maybe I’ll give it a shot. Swing trading is for me right now. I’m anxious to move forward, I want to learn about options, I’m very nervous about it. Seriously, when I think about it, it scares me to death because I’ve lost a lot of money.
David: It’s funny. As I was preparing for this podcast, for our discussion here this morning, the last few days I pulled up my account. I’ve never done this before. I pulled up my TD Ameritrade account, and looked at cost basis. I didn’t realize that you could do it going back as far as you could, and I pulled up every single year dating back to 2004 or 2005, and it had my whole record of trades, going all the way back that far. I realized just how bad I have done over the past 15 years, or whatever it’s been. It was so bad, all the way up until this year.
David: Clay, I’m happy to announce that I, for the first time ever, I’m way ahead of where I started. I am well in the green, compared to every other year before I started. It’s almost 15 years of total red, and this year I’m actually using the rules, I’m using the analysis, the technical charts, and it’s working. I’m making some money.
Clay: Shocking.
David: I know, right?
Clay: You have tools, and you use those tools properly.
David: I’m making some, I’m losing some.
Clay: It’s weird, huh?
David: But overall, I’m making more than I’m losing, but I still get caught up in the emotion sometimes. I finished the day yesterday … This week alone, I was alerted on a couple of trades within the chatroom that turned out to be fantastic. There was one on Thursday that was great.
Clay: Which one was that?
David: What was it called? I’ve got it open here, let me see real quick. Sorry.
Clay: That’s all right.
David: I can’t remember. Like you said, I traded so many different stocks just this year.
Clay: We’re recording this on a Saturday morning, and I can barely remember the trades I took yesterday, on Friday. I totally get it.
David: TRNX, [crosstalk 00:58:43].
Clay: That thing has been a monster.
David: Yeah!
Clay: It had 400 million shares traded yesterday, it was insane.
David: I don’t know who the guy was. It was Thursday, the guy alerted it, the person, I don’t remember.
Clay: Yeah, I do remember. Actually, I’m sitting, let’s see if I can …
David: I pulled it up, and looked at it when it was, I don’t know, 13 cents a share or something like that.
Clay: Yeah, She Dog. She Dog, or something? Shay Dog?
David: Yeah, yeah.
Clay: I think so, I’m looking back through the alerts right now. Yeah, they alerted early on yesterday, when it was still well below where it’s at right now.
David: I got in, and then almost $300 later, I got out. I just made $300, on a day trade, I’ve never done that before.
David: What I think the difference of this was, the risk I felt, for me, was lower with this one. I’ve made some mistakes, even earlier this year, even while taking your courses, was that I wasn’t looking at enough. One of the things I got caught up in, this Chesapeake Energy, CHK.
Clay: CHK, oh yeah.
David: Oh, that just killed me. I found out where my mistake was, was I was looking at so much of the technical side of it, I didn’t even bother to look at the news. I had no idea these guys were doing a split, so I bought where I thought was probably a good time to buy. Overnight, when you get the alert when your account is in transition, and it looks like you made $50,000.
Clay: Yeah, but it’s the good old reverse split.
David: The reverse split, right. I knew as soon as I saw it, because I’d seen it before, with my lengthy experience of reverse splits, and bad trades, I knew what it was so I didn’t freak out. I showed my wife, just messing with her. “Look what I made overnight!”
Clay: Oh, that’s cruel, that’s cruel.
David: “I made $50,000 overnight!” Then, I explained to her what was going on. I’m like, “No, no, it’s not real, this was obviously a split.”
David: I went back, and started looking at it on my platform, right on the Think or Swim platform, on the graph, on the right column there’s an N button. You just click that N button, and it brings up the news, and it sits side by side, automatically, with your level two. I’m thinking, all I had to do was have that turned on, and I would have seen it before I made the purchase, and I would have realized, I need to take another look at this instead of just jumping in, based on the talk.
Clay: Yeah. Here’s playing Devil’s Advocate. Let’s say you had that news thing open, and you’re looking at a stock, and it’s just falling, falling, falling. You have the news things open, and you see IRS investigating tax fraud. What would that make you want to do, as far as the trade? The price is going down, and then you see the news that says IRS investigating for tax fraud.
David: Well, I would want to get out, but this is where my-
Clay: Would you think about maybe going short?
David: Well, this is the problem, I haven’t gotten to that point yet. I don’t even know how to do that.
Clay: This is what I’m getting at though, is news is a very tricky situation. I get it, in this situation, yes it would have been good to know that news.
Clay: But in the circumstances that I laid out you would think that a stock price going down, and then if you were to see the news that says company being investigated for tax fraud.
David: It would be a perfect gain.
Clay: It would be logical to say, wow this thing’s going to keep going down. Do you wan to know what happened? Because this is a true story. It didn’t happen to me, but within that same day, the stock just boomed back to the upside. Now, I think it ultimately rolled back over, but had you let the news influence you instead of watching the chart … Oh wow, those are some hammer candles. Oh, there’s another hammer candle. But, look at that news, you could have gotten roasted from the short side.
David: True.
Clay: I get what you’re saying and you’re not wrong, but it is a fine line between how much news do you really want to let come in, and how much you want to just focus on the chart.
David: Right.
Clay: That’s one of those lines where it’s all personal preference, but it’s just one of those things where you’ve got to be aware of that because sometimes news can influence you too much, where the signs are right there on the chart, and you ignore them because the news is manipulating your mind too much. Just something to throw out there for you.
David: Yeah. I agree, it’s a portion, it’s a small portion of the bigger picture. But, the fact is, where I was trying to go with this, there’s so much involved you need to know. All these things you cover in your robotic training course, you should have some level of basic knowledge of, to be able to trade successfully.
David: I learned about the SMA, and I learned about the Mac D, and the other things. I knew a little bit about them before, but never really knew how to set them up, and how to read them. After I took your course, that’s when I started to realize, okay, this is a good baseline to really get an understanding of what it is I’m reading. It was only just now starting to come together, and the news was just one more thing on that. That it’s not a bad idea, because you can kind of see what might be more sustainable. That’s what’s happened with the TRNX, right?
Clay: Yeah.
David: There was some good news that came out with that, was the reason behind what led to it getting to that point. That’s what created the alert, and then the charts come into play, along with it. But, from what I’ve learned, the news helps support the idea that this could be sustainable. Or, is it going to hit a peak, and drop off? That kind of news is what I look for.
David: I say that, and per your comment, news doesn’t always tell the whole story. I did the same thing yesterday, with another one that had some good news that came out. I’m still in on that one, that one is … Let me see, here. AKRX, Akorn.
Clay: I should have just guessed it. I was thinking, that was the other. I was like, what other one had a huge amount of volume yesterday? Yeah, AKRX.
David: AKRX, I jumped in, but I jumped in high at 40, thinking that it was going to do the same thing. Again, I backed it up with the news, it was good news, it was good, solid, stable. It should indicate that it’s going to stay on the same track. But, it didn’t, and it backed off, and then it stayed back off.
David: Then, look what happened in the last five minutes of the trading day, it dumped.
Clay: Yeah.
David: Here I am, I’m sitting on it, I’m not going to sell it off right then. If I was going to sell it, I should have just sold it at 330, because at 355, everything went down in the hole. Here I am, sitting on it. I added a little bit more to my position, as it dropped a little bit more. I think it came up again later in the afternoon, at one, two o’clock, or something like that, it went up again a little bit but never reached that high point that it was.
David: Now, I’m back in a situation that I was in before, because the biggest difference between this and what … I broke one of my own rules. I broke the rule of letting the emotion play. I was watching it too closely, and I reacted, and I wasn’t following the charts. Because I broke the rules, it’s in the position I am with that right now. So this is what leads me to believe I’m not ready for futures, I’m not ready for FOREX, I’m not ready for options. I need to figure out how to just read the charts, understand what I’m reading, know good entry points, exit points, set up the automatic trade points.
David: As long as I’ve been doing this, which, if you condense it all down, I guess my total real experience along with my education probably doesn’t span six months. Even though it spans in timeline more than 15 years, but my level of experience is very, very minimal. I can see the value of this now. Sitting where I am overall, I’m much more confident, much more comfortable, and I know this is leading down a good path. I love it, it’s exciting to me. It’s a nice alternative to the day-to-day that I get into, especially now when we’re all trapped inside our homes.
David: But, it was getting to the point where I was working from home anyway. On breaks and lunches, I’m able to more easily use my own Internet to be able to access the stuff on my own computer. I have my work computer to work, and this is totally separate. I feel like I’m going down a much more stable path, with results that I’m starting to see now. Good results, which only helps drive me even further, and I’m anxious to keep going.
Clay: Did you say all that off the top of your head, or did you have bullet points or something?
David: No, it was off the top of my head.
Clay: I was going to say, it sounds like you wrote that up for the conclusion to this because I don’t think you could have really ended your little journey better than that. Looking at the time, we’re a little over an hour, it’s a good two part series almost, leaving everybody on a good little cliff. You’re definitely going to have to come back at some point, and continue on with us, because that was a perfect wrap up. To the point where I thought, did he script that out, because that was really elegantly put. That’s some good stuff.
Clay: My final question to you, which I’m sure you know is coming is if … I think I already know the answer to this. But, if I were to give you the time machine, and you could go back to, I don’t know if you want to go all 15 years back, or whatever point you want to go to, but if you could go back to t start, however you want to define that, and give yourself one bit of advice, what would that bit of advice be?
David: Invest in the education, even if it meant taking a full college course. I don’t even know if they offer college courses on trading. I would have spent whatever I had to spend to learn as much as I can about the markets, about trading, about the technical side of things. To me, that’s invaluable. I don’t think you can be successful in the markets without really understanding everything that’s going on, and it’s worth it. It’s completely worth it.
Clay: Well said. Other people have said that many times before. As I always say, it’s one of those things where, jeez, if a lot of people keep saying the same types of things, maybe there’s a little truth that goes with it. I think that’s going to be the title of this episode, what did you say earlier? You’re the most experienced novice, is that what you called yourself?
David: Yeah, the most experienced novice because as a novice it spans 20 plus years.
Clay: It makes perfect sense now. I want to double check, but that’s going to probably be the title of this episode because that’s a great way of putting and summarizing pretty much how this has all been. But, it’s been awesome.
Clay: We’ve got to lighten things up here a little bit, do some fun questions. What is your favorite movie?
David: My favorite movie? Yeah, you surprised me with that one, I wasn’t expecting that. There was a movie that just popped into my head, probably because of the date. I was involved in aviation years ago, with the military, and I remember Top Gun was the movie of 1987. Whenever I think of my favorite movie back then, as a kid, it was that one. It was just so exciting for me.
Clay: Yeah, Top Gun, that’s a classic. Anybody that doesn’t like Top Gun can move to any Communist country of their choosing, as far as I’m concerned, but that’s just my opinion.
Clay: What about your favorite food?
David: You totally threw me with these questions.
Clay: You said you had listened to episodes before, haven’t you?
David: Yeah, I have.
Clay: You turn them off before we get to the end, don’t you?
David: Busted!
Clay: I’ve asked these every single time, you should not be caught off guard.
David: Favorite food, I don’t know, like everyone else I enjoy a good pizza, I guess.
Clay: You can’t go wrong with pizza.
David: No.
Clay: Then finally, three words-
David: You know what? More recently, though, I think I really enjoy sushi. For some reason, the past year, I’ve been a sushi king. I just love sushi.
Clay: You’ve probably got a lot of it down in Florida, since you’re a little bit closer.
David: Well, I’m a big fisherman, too. Yeah, down in Florida, I fish not nearly as much as I want obviously, but I take my son fishing. We do offshore, inshore, saltwater, freshwater. We actually live on the St. John’s River system, the development we’re in is right on the water so we have water access to the river. I’ve got a small fishing boat, so we do a lot of fishing, and I eat a lot of fish.
Clay: Nice.
David: I love fishing, yeah.
Clay: Yeah, Gain Greens, that’s his alias in the room. He was a member, I don’t know, five, 10 episodes ago, he’s down in Florida. Yeah, he’s big into fishing, too, down there. I don’t remember, I think he’s more so on the coast somewhere. Anyways, you guys would have a nice little talking point, right there, something in common.
Clay: Then, final question, three words, and these three words need to be what you would associate with a successful trader, what it takes to be a successful trader, what would those three words be?
David: Education, perserverity, attitude.
Clay: I like it. Good, I agree. All those would work together very, very nicely.
Clay: Well, thank you for being here. Like I mentioned earlier, we’re on a Saturday morning, so I appreciate you taking some time out of your Saturday morning to hang out, and share your story, and offer up some very valuable talking points. But like I said, you’re going to definitely have to come back at some point, because you left us on a very, very solid end point. It makes me just as curious, as I’m sure anyone else to wonder, what’s going to happen next. Will you come back at some point?
David: Oh, absolutely. Yeah. Thank you for the time, I love this. This was great, it was a lot of fun.
Clay: Good, good. Well, I appreciate you being here, and like I said, we will definitely have to have you back.
Clay: Now, as far as you listeners out there, final few things before we go. First off, if you’re listening on iTunes or any of the other podcast players, make sure to subscribe so you can get notified whenever new episodes and such come along. Especially on iTunes, if you could leave us a rating, that really helps out. Or, better yet, a written review. I would really, really appreciate that, as that really goes a long way in helping just get the word out that much more.
Clay: If you’re listening at ClayTrader.com, on the show notes page there’s a little chat box there, so feel free to reach out with comments, questions, suggestions, constructive criticism, whatever. Love to hear from people, it’s always enjoyable when somebody starts off a comment with, “Hey, I listen to the podcast.” That’s great to hear from people, those of you that are out there that listen, so I’d love to hear from you.
Clay: But, thank you again to David, thank you to all of you as listeners, and we will see you back next week.
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