In this episode, we interview full time trader Derek Chernault (“hokiez28”) whose primary strategy is swing trading; however, also does some day trading to compliment his overall strategy. Like many traders (myself included), emotions were a major thorn in the side of Derek’s early trading experiences. Learn how Derek was able to not only eliminate the emotions from this trading, but also build up the confidence in order to trade full time.
Whether you are thinking about swing trading or day trading, this episode will give you a very realistic view into both of these strategies.
Notes:
Derek’s introduction to the stock market was based on a product he used to help him quit smoking.
He put $4,000 into 2 penny stocks as a long term investment and then used another $1,000 for active day trading.
Derek was completely content taking 30-50% gains but greed had started to set in after he watched a few run 1000%+.
Once he realized his initial success was luck, he decided to invest in some trading education to help him approach the market from a skillful standpoint, not a lucky one.
A huge turning point for Derek’s trading was moving out of penny stocks and into larger capitalization names because of the increase in liquidity.
Derek’s biggest problem was managing his risk and once he applied it to his swing trading it really clicked.
We discuss the misconception of the ‘holy grail’ with a combination of indicators. Derek suffered from paralysis by analysis and now trades the 2 king indicators… Price and volume.
Quotes:
“I was immediately intrigued by watching the value of my money go up and down but I wasn’t really trading. I was parking my money.” tweet this quote
“I was happy with 30, 40, 50% profit. But then the greed started getting to me because I’d watch some go up 1,000%.” tweet this quote
“Within 2 weeks that couple thousand dollar investment was worth 20k. But I didn’t sell a single share.” tweet this quote
“That luck I had in the beginning had run out and I realized that I didn’t have any skill. It was all luck.” tweet this quote
“That’s when things really turned around is when I got out of the penny stocks and moved onto the big boards.” tweet this quote
“Early on I never wanted to take a loss. I would just keep holding and usually sell the very bottom.” tweet this quote
“One of the biggest things I’ve learned in trading is that you have to accept that you are going to be wrong sometimes.” tweet this quote
