Transcript

Clay: This is The Stock Trading Reality Podcast, episode 256.
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 everyday normal people who are currently on their journey to trading success. And this is your host. His kids officially know Star Wars better than he does. Getting old sucks, huh? Clay Trader.
Clay: And do you know what? I’m actually quite proud of it. Never did I think that my, what is she? Five, five-year-old daughter would be able to answer Star Wars questions quicker than I am. What Dot, my second oldest, and really all of them, their understanding, their, what am I looking… their just general knowledge, their trivia. There we go. Their ability for Star Wars trivia right now is already very impressive in the, I guess, what is it? The fourth Star Wars? No, the fifth one. The one from the 70s though. The Empire Strikes Back. They’re on the ice planet Hoth, and then they’re writing these beasts. And I don’t know what those things are called. They’re like big horses. I don’t even know. But of course my daughter, Dot, “Oh, you mean the tauntauns? I’m like, “Oh yes. That’s what they’re called tauntauns.
Clay: So just little things like that. It’s amazing. I guess little kids’ minds truly are like sponges, but I’m… Not that I am an expert in Star Wars, but yeah, I’ll geek out about Star Wars, and I’d like to think that I have a pretty good solid understanding of Star Wars trivia, but I think if I’m being self-aware and honest with myself, my kids might’ve just surpassed me because, especially Dot. She is on the ball, and even Joy, my oldest, she’s firing on all cylinders too. But it’s fun to watch and I guess it’s one of those timeless things because I remember watching it with my parents and now here they are watching with me, and now their trivia is just continuing to get better and better. So yes, no shame here. I am no longer the King of Star Wars trivia in my own home, But I suppose the time had to come at some point.
Clay: Moving on to our guests. I was going to say we’re going to go down to Jamaica, but he’s no longer in Jamaica, but he grew up in Jamaica, then he immigrated to the United States. So fair warning here, if you are somebody that enjoys excuses, if you are somebody that thinks that you absolutely have to have the newest iPhone, then you’re probably not going to like our guest, Jermaine. Jermaine is a hustler. Jermaine’s a grinder. He’s had to do what he needed to do, and I suppose it’s a little spoiler, but at one point he was like, “You know what? I want to save $20,000 for this training thing,” and he saved up $20,000. How he did it, what he had to do, That’s one of the small little things we talk about.
Clay: But Jermaine’s story for me was most inspiring when he used his term aggressive living. And I said, “Hey, I’ve never quite heard that. Why don’t… ” Well, let’s talk more about aggressive living because maybe as a listener, you’re sitting here saying, “$20,000? That’s… ” Yeah, it’s definitely possible. And how did Jermaine do it? What did you have to go through? What decisions did he have to make? And then of course we talk about his trading and all that, but definitely a fascinating story. A great… Assuming of course you like motivation, you like inspiration, you like to hear from people that are like, “Wow. That’s a beast mode. Like he is beast mode in life.” Assuming you like that sort of set up and that sort of kind of mentality, then you’re definitely going to enjoy the discussion I had here with Jermaine. So let’s get to it and hear about Jermaine and his trading journey.
Clay: Jermaine, welcome to the show.
Jermaine: Thank you.
Clay: Now I was just telling Jermaine this before we started recording, but one of the questions I always ask people is, “Hey, have you ever listened to any of the past episodes?” And most people say, “Yeah, I definitely have.” And that way, because, okay, well you know what you’re getting yourself into. Jermaine said, “No, I haven’t.” So he has never listened to a previous podcast episode before, so he is totally flying blind. And as I was telling him, these are always fun because this is literally as genuine as it gets. And I know nothing about… well, unless Jermaine’s emailed me, but I don’t know really anything about Jermaine. So this is legitimately us… just the equivalent of sitting down at a coffee shop, you being a fly on the wall, and just hearing a couple of people talk trading and talk the markets. And so I’m excited to see where this goes, Jermaine.
Clay: So, my first question to you is just, where did all this begin for you in terms of the markets? Where did you hear about the markets, and what sorts of things played out that brought you to the point of deciding that you wanted to get more active and hands on with it?
Jermaine: Yeah, well, pretty much I started in college. Actually went to college in Jamaica, and while I was there, I always hear about the stock market and people are trying to do it on their own without a broker. And that’s pretty much how I got started. There’s two things I love is food and money. So I started out trading right in my dorm room with a couple of big black computers. I didn’t know what I was doing, so I threw $100 in into the market, and of course I lost it all.
Clay: What did you… Well first off, are you in Jamaica right now?
Jermaine: No, I’m in New York. I immigrated to the States a few years ago, several years ago I should say.
Clay: Cool. Awesome. Awesome. So you, just in Jamaica you had heard about this, the stock market thing, and you made a comment about the broker. So you thought that you needed to have a broker, or… ?
Jermaine: Yeah. So I thought I needed to give, because in Jamaica, how you do it is that you go into a brokerage firm and they do the trades for you, so that’s how it was back then. But then a lot of that has changed for now. So when I found out that I could actually trade for myself, my ego went sky high and I was super excited.
Clay: Yeah, exactly. You said back then. What year was this when you were-
Jermaine: This was around 2010, 2011.
Clay: All right. So wow, that’s… Time flies. Almost 10 years ago then. Almost. Oh, so you thought that a broker was needed, but then you learned that a broker was not needed, and I think like the majority of us, yeah, your ego is like, “Oh, all right. Yeah, I can… ” That was definitely me. I signed up for a mutual fund at first, and then I was just like, I can do this. What do I… What am I… Sell a mutual fund. I can do this better. And kind of the rest is history. So I totally can relate to the whole, oh wait, you don’t actually need a financial advisor. I didn’t need somebody to just tell me what mutual fund to buy. I can be doing this all on my own. Yeah, it opened up the word.
Clay: So, all right, well you said you threw $100 in. So what broker did you use with that $100?
Jermaine: When I first started, I started with TD Ameritrade, and for me it was too complex. There was a lot to go through, so I started Googling and I heard of TradeKing back then.
Clay: Ah, yes.
Jermaine: And it was easy to sign up with them, so I signed up and threw in a hundred bucks and started trading.
Clay: I’m assuming you started trading stocks?
Jermaine: Yeah, I did. I started trading stocks, right around like penny stocks, thereabouts. I think my first trade was Galena, GALE, that stock?
Clay: Yeah, G-A-L-E?
Jermaine: Yeah. I was [crosstalk 00:07:45]-
Clay: How did you find GALE? Were you on social media? Were you just… What was your “scanning method” back then to locate an actual trade?
Jermaine: It was crazy. I was Googling and Googling other people, how they actually trade stocks and what they were trading, and that’s when I think I found StockTwits back then.
Clay: Oh, yes.
Jermaine: So I just started following people, and just try to do whatever the people are saying, and that’s where I pretty much started.
Clay: How did you determine what people to follow?
Jermaine: It was mostly people who were responsive. I must admit, I didn’t follow probably the best people because they were just as ignorant as I was and just starting out, I should say-
Clay: But at the time you didn’t know that though. Right? To-
Jermaine: No.
Clay: … offer up your little defense, it’s not like at the time you’re like, “Hey, these people are ignorant and new just like I am, but I’m still going to follow them.” At the time, you probably thought they knew what they were talking about, right?
Jermaine: Yeah, I did because back then I didn’t have anybody around me who knew how to invest in the market. So it was pretty new for me. So anybody I came across that would say something about the market, you know, I cling to them. That’s pretty much how it was.
Clay: That’s… Oh, nothing like getting started and having no idea of what you’re doing. But at the time, like you said, and that’s why I circle back to the whole ego thing, you think you have a good strategy like, “Oh yeah, this person’s responsive. This person’s talking. Yeah, this makes sense.” But then we sit here in hindsight and the way you chuckle at yourself, I can tell things… Well, I suppose you already spoiled that that $100 went poof. How long did that take to happen? Was it on that GALE stock or was it on some other stock? Did you have any success at all with that $100, or, I guess, walk us through the little history of that $100.
Jermaine: Yes. So pretty much when I started, I tried that one stock at first to see how it felt. What I would do at first is I started watching a couple of videos to see what’s a stock, how to trade, things like that. But I couldn’t wait to go through all the videos. So I jumped into the game. I purchased one stock, I’d wait couple minutes, and then I sell it. If it goes up like couple… just move couple cents, I would just sell it for whatever profit it was. But after that I felt so much more comfortable and I started getting into trying out the $100 to probably try out I think like Microsoft back then. I don’t remember what those stocks were, but whatever my $100 could buy, I would throw it in there.
Jermaine: But what happened was I started to lose money, and as I lose money, I would sell it. I didn’t know anything about hold until it goes back up. As I see it go down, I said, “Okay, well, I’m losing my money so I’m pulling out.” And I kept doing that until I wasn’t even able to purchase any stock anymore because it was, I couldn’t pay the fees plus purchasing that stock. So, that’s pretty much how I basically just ran through all that money [crosstalk 00:10:58]-
Clay: So it was pretty much a whole lot of randomness it sounds like.
Jermaine: Exactly.
Clay: There wasn’t any sort of rhyme or reason or strategy-
Jermaine: No.
Clay: … it was just… At the time, what did you think you were doing? Do you think you had some sort of style or strategy, or… ? Because I always like to ask people because it’s amazing how the human mind can work, because obviously at the time, in hindsight you sit here and look, like, “Yeah, I had no idea what I was doing.” But of course at the time you’re not sitting there saying, “I have no idea what I’m doing. This is totally random and I’m just… ” what I mean. You, and I realized that this is basically almost 10 years ago, but do you remember at all what you maybe thought your strategy was or… ?
Jermaine: Yeah. So I know I wanted stocks with a lot of high volume and I loved biopharma stocks, so I would stick to that religiously. Every now and then I would jump out and try purchasing the big companies, the ones that are very popular like Amazon and Microsoft. And I beat myself every time that I think about it, if I just buy the one stock and leave it how much money I would earn right now if I just invested longterm. But my strategy was pretty much buying stocks that were moving pretty quickly, and whether it’s on news or fake news or whatever it was, and I knew it was, I wanted biopharma stocks. I love those because they were easy to get into. A lot of people were buying them. And that was a lot of talk on StockTwits back then too for biopharma stacks.
Clay: Yeah, those are always, I mean there’s a time and place, but boy, those things can make you rich or they can send you to a cardboard box in a hurry if you’re not careful with those for sure. And that would make sense then how that $100 dwindled down. Did you ever grow the $100 up to any significant amount or did it always just kind of stay right around $100?
Jermaine: No, I blew through it and then I started putting more in.
Clay: Well, that’s perfect. You read my mind because my followup question would be, okay, so this $100 is gone. What do you next? But you just kept pouring more money in.
Jermaine: I just kept pouring more money in. So whenever I got paid, I just started putting like $200 more now. And this time I’m like, I’m not going to do this anytime, or I just want to make $10. That’s all. So that was my new strategy after that. So it’s no longer holding and waiting around or saying, “Oh yes, it’s going to go higher. It’s going to go higher.” It was a strategy. If I make $10 I’m going to sell. That was the new strategy.
Clay: All right. Well, I guess that’s progress, but again, in hindsight it’s always funny to sit here and be like, wait. So I thought that was a strategy, is I want to make $10.
Clay: For you listeners out there listening to this, I assure you, you sitting there saying, “I want to make $10,” or any amount, that’s not really a strategy.
Jermaine: Nope.
Clay: I suppose that’s part of a strategy in a sense. But just definitely just part. That’s not really a strategy’s I want to make $10.
Jermaine: Right.
Clay: So I guess my question would be, did you start to make $10, or how did it go from that point?
Jermaine: Yeah, I did. For a good little while I started to start making a little bit of profit. So I probably grew that $200 to like $250, and I was, man, I was like super excited. So I started getting a lot more aggressive and that’s probably my mistake, wasn’t it? Just stopping it and actually comparing something.
Clay: Let me correct you. That’s not, there is no probably. That was definitely your mistake. That’s what everybody always says. They have a little success and then all of a sudden, let’s up the size. Let’s just build way too big then… Well, I guess, I think I know where this is headed, but I’ll let you. So you’re at $250. You decided to up the size. So how did it go from there?
Jermaine: Yeah, and I started having a little bit more success, but after that what happened is I threw all my money in into one position. I wasn’t diversifying. I wasn’t putting any… like splitting my money like in half or something like that. I just started throwing every single thing in. And then what happens is that that $250 just went all the way down to probably $150, and I’m like, Jesus, like what does the market got against me? The guilt starts riding me. My brain was going all over the place, and I kind of take a little break at that time and started saving up some more money.
Jermaine: So I think at that point in time, this was like probably a year into it, just tried trading into the one money, and whatever money I saved up I could put back in, but I literally stopped at that point in time because I knew I wasn’t doing something… I wasn’t doing it correctly, and I couldn’t waste any more money because back then that was a lot of money for me.
Clay: So you were at $250 and then you dropped down to right around $150?
Jermaine: Yeah.
Clay: And then that’s when you made the decision to just kind of tap the brakes?
Jermaine: Yup.
Clay: That’s actually pretty good. A lot of people blow up. It takes them literally going to $0 to be like, “Hey, I probably don’t know what I’m doing.” So I commend you for being self-aware enough to at least acknowledge that at $150 rather than $50 or $0 dollars, you said you stepped away and you just continued to save. So how long did that last for? How long were you actually out of the market?
Jermaine: I was out of the market for at least to five years. I really zoned in into… I just graduated from college and I just started focusing on building my career because that’s what mother and father said to do and that kind of, you know, you want to make them happy at this stage of your life to kind of build a foundation. So I did that, but because I loved the market so much, I actually studied computer science. So I went to actually work for a bank.
Clay: So you have a computer science degree?
Jermaine: Yeah, I do.
Clay: Very nice. Very nice.
Jermaine: So I went to work for a bank and pretty much got into investment banking, and that’s where the whole… the attitude towards investing changed a lot because I was… pretty much dived in into learning what investing is and what are the best strategies and how to do it. So at that point in time, throughout those five years, I knew I was coming back into the market. It was just a matter of time.
Clay: Now when you went to the investment bank, did you go into some sort of like IT role, or were you like-
Jermaine: Yes.
Clay: So you weren’t like showing up as an investment banker, you were doing more the technical computer side of things?
Jermaine: Yeah, I was the IT man, under the desk plugging in computers and checking why it wasn’t working, stuff like that. Yeah.
Clay: And this was in, you said New York?
Jermaine: This was in Jamaica at the time, so I was still in Jamaica. Yeah.
Clay: Cool.
Jermaine: So I was working for investment company there and then I migrated here and I was still working for that investment company from the US. I was working remotely. I was fortunate to be a good worker so they kept me on for at least a year after I migrated.
Clay: Well, I don’t know about fortunate. I think that’s one of those situations, you create your own fortune by being a good worker, right?
Jermaine: Yeah, and it definitely helped that I wasted that $250 because when I went in for the interview, I could speak the language. And I guess it showed passion for investment as well, so… In hindsight, it wasn’t a bad investment to lose that money.
Clay: There you… I bet you got a really good return on that investment then if that gave you just the opportunity to, like you said, speak the language, and I think everybody likes a good old horror show, and you’ve been able to sit there and be like, “Yeah, I love this stuff. I got kicked in the face, but hey, at least I tried it.” That does show passion and that’s good stuff right there. So who knows that that little punch in the face would have become so valuable later on.
Clay: So, all right, well-
Jermaine: Yeah, that’s true.
Clay: … you’re out of the market for about five years and that’s interesting. You kind of always knew that you wanted to get back into it. So did you have some sort of number that you were trying to save up to, or maybe a better question would be, how did you define, how did you know that when it was time to actually come back into the market?
Jermaine: What my goal was was to make sure I paid off my student loans. So one of the things that I started doing was starting to listen more to like CNBC and I’m still on StockTwits, but at that point in time I was able to weed out a lot of the noise and I came across I think like three people. I think I came across you, some Investor Underground guys, and a few more guys. I think was this other guy, I forgot his name.
Jermaine: But yeah, I started to realize what was real, how to look at strategies, and then I started to actually do more learning first before going into the market. So I knew I wanted to be not in any debt. I wanted to… The first thing that I learned was to make sure that you can actually lose the money that you’re actually putting into the market. So that’s kind of how I got a little bit mature, made sure that everything was tucked away and I knew that I wanted to come in big this time. I want to be ready. It was money that I was willing to risk, and I was looking at around like $20,000 at that point in time.
Clay: Well, good for you. You, and that was just from you saving up money. Right?
Jermaine: Yes. Just saving.
Clay: So for the people out there because I hear it all the time, what? They think… And not that $1,000 is not a lot of money, but it is possible, yet you just have to have a plan and you have to have, and I would assume that as soon as you got rid of that debt, I’d imagine that money added up that much quicker every month, didn’t it?
Jermaine: Oh yeah. Oh yeah, totally did. But it was aggressive living as a young man after college. It was living lean and making sure that you don’t waste any of the money. That’s pretty much what it was.
Clay: Well, I want to hear more about… That was an interesting term, aggressive living. So walk us through the lifestyle because as a listener, maybe they’re sitting there saying, “Wow, $20,000. How do I get there?” Well, here’s a realistic view of what it takes in some situations to get there. So talk. Tell me more about aggressive living.
Jermaine: So what my living was, it was basically saving 90% of whatever I earned. So my spare time was working two to three jobs. I was working at the bank during the day and I was working for a software company that was located in the US at night. I’d leave work probably around 6:00, 7:00 in the night at my day job and sleep for a couple of hours, and then I’m up at like 3:00 in the morning because I was starting, I was working with teams that were located in like Spain, Venezuela, so were all over the time zone. That’s how aggressive it was. It was like, I’m here to make some money. So I worked my day job when I was working a second job in the US. So the reason why I was able to save that much was because I was working in Jamaican dollars to pay taxes and all of that other stuff, you know, regular living, pay back student loan, but a majority of the income came from working for the software company.
Jermaine: And it was, I started out pretty small with that company. I actually started out as a QA person, just testing applications. And then I just basically grew by applying myself and learning a lot more within the company. And I was able to grow into a manager position after like three years with them. So I was literally working two jobs for at least four years there, four and a half years, when I migrated here to the US.
Jermaine: It wasn’t partying a lot, but it was definitely having fun. I didn’t live in a lavish apartment. That was the other thing too. As long as it was good, safe, I paid like roughly around $200 a month or $250 a month for my apartment. So it was definitely not doing everything that my friends were doing. It was basically saving at least 90% of my whatever I earned from wherever and basically paying off the loans and putting that into my savings account.
Jermaine: The other thing I did too, because I worked with a new investment company, so I was able to see whatever they would do with my income. So I obviously put those into like bonds, Treasuries at the time that I could afford to, so my money could definitely grow for me. So that’s kind of my turning point in terms of investing and saving up to be able to come back into the market.
Clay: During this time, did you always have the newest version of the iPhone?
Jermaine: No.
Clay: Well, How did you survive, Jermaine? How were you able to stay connected to society? Don’t you need the newest version of the iPhone?
Jermaine: No.
Clay: What are you, a caveman or something? How did you.
Jermaine: No.
Clay: What were you doing? What’d you use?
Jermaine: Once my phone still works, I kept it. That was me. I never upgrade. I’ve never had the newest phone when it came out. Never ever have any of those phones when it came out. I always had the oldest version phone running with. And the other thing too, I used to buy for my friends. I used to buy a used phone from my friends when they didn’t like it anymore. And then the other thing too, I didn’t go with like big plans like with T-Mobile or anything like that. I had like Straight Talk. So, yeah. So that’s pretty much how I kind of lived basically within my means, I put it.
Clay: That’s good stuff. That’s what hustle and grind looks like. So for you as a listener out there, you can save up money. Now, Jermaine, myself, we’re not saying it’s necessarily going to be the most pleasant experience-
Jermaine: No.
Clay: … but it is totally possible. And I think my favorite part of all that is you’re just sitting there. I don’t know, maybe I think you’re a bad friend because you’re sitting there letting your friends buy and waste their money on the newest updates while you’re, I’m assuming, getting awesome deals because they’re just looking to liquidate their old phone. And so they’re like, yeah, “Oh wow, you’re actually going to give me some money?” And you’re like, “Yeah, I’ll give you this.” And you low ball them and they probably just take it because who cares? They’re all fired up about the new phone.
Jermaine: Exactly.
Clay: I love that though. You just bought the used phones of your friends while they’re out there. That’s good stuff. And that’s what it takes. And that got you up to $20,000. Is that the number you said?
Jermaine: Yeah, that’s the amount that I wanted to have to go into the market. I’d made a lot more than that, but that’s the amount that I wanted to go into the market with, pretty much.
Clay: And how long did that $20… Is that what you waited until you got was the $20,000 or did you decide to get started in the markets before you had that number?
Jermaine: I actually started after I had that number-
Clay: Oh, okay.
Jermaine: … because I was pretty disciplined about that. Yeah.
Clay: So you waited until you got the $20,000 and then you got started again?
Jermaine: Yeah, I got started again.
Clay: Okay. So let’s do this then. You get the $20,000, so pick up your journey from that point.
Jermaine: All right. So I pick up my $20,000 and I deposit it into my E-Trade account, but I was very skeptical at this point because it’s now my hard earned money. I need to be sure of what I’m doing. I’m definitely not going to be just throwing it anywhere and anyhow into the market. So what I did, I think that there was at that point in time I signed up for two service. It’s two services. I was in a particular group of guys that, they were throwing out stocks to purchase and things like that, and I was paying I think $199 or a little bit more than that per year. I cancel that service and I think I saw your message on StockTwits and that’s when I think I reached out to you and joined the ClayTrader group.
Jermaine: Now, at this point in time I was still trading penny stocks and I was making good money because I was throwing like $5,000 on those stocks like, what do you call it? It’s been a while. Let me see if I can remember a couple of them I remember very well. Dryser’s was one of them. D-R-Y-S.
Clay: Oh yeah, the shipping companies?
Jermaine: Yeah. That was one of them.
Clay: Let’s see. TOPS made a big move.
Jermaine: Yup. TOPS was a big one too. Yup. So I was going aggressive with those stocks. I was making money. So I was turning five grand in profits now. I’m like baller.
Clay: So you’re making like five grand, like not necessarily… Well, I don’t know. Was it per day or like per trade?
Jermaine: Like over time. So for example, in like a month time I was making like $5,000 in profit. Blew my mind. But I had the money at that point in time to throw it in there.
Jermaine: But the same mistakes befall me. I got excited. My ego got the best of me. And because I have enough money in the market, if it goes down, I’d still hold on to it. I think there was a stock called FNC if I remember correctly. I’d need to remember what that stock was. I remember I held that stock and was losing like two grand on that stock and that’s how I started to get nervous. And I’m like, why am I making the same mistakes again? I follow people again. I was like going back and forth, and I said, I think it’s time that I stop listening to everybody, figure out a strategy. I was trading penny stocks and by the end of the day I was so burnt out and I was like, I’m at home because at this time I was working the US job only and so I was working from home. I’m like, why am I burnt out at the end of the day? This is not what I expected coming back into the stock market to be like.
Jermaine: So I purchased the best computer. I have seven monitors going. I was just like, that’s how I saw it on the TV or I saw everybody doing it and I thought that’s how I needed it to succeed.
Jermaine: So I started making a lot of profit in the beginning for like probably a month or so, thereabouts. I was here, I was listening to you guys and all of that. But then my ego kicked in and then I started to only listen to myself. But I started getting burnt out, and when I started getting burnt out, my pocket was getting burnt out too. I was starting to lose a lot of money. But when it got, I think I burned that 25… When I got up to like 30K within about like four or five months. But then that started to dwindle down, and I was like changing my strategy. So I moved from penny stock into only investing in blue chip companies. And then when that I got tired of that. So I was moving through this money real fast.
Clay: Let me ask you a question real quick. Did you quit your one job?
Jermaine: I quit the job in Jamaica because I couldn’t handle both of them anymore. So I was the one US job.
Clay: So you’re in your mind, I want to do this trading thing-
Jermaine: Right.
Clay: … not necessarily full time because you still, like you said, you had that software and that job was the one where you said you’d have to get up at like 3:00 AM?
Jermaine: Yup.
Clay: So that’s what allowed you to be able to trade the normal market hours then?
Jermaine: Right. Exactly. Yup. So I started going through, I went up to like 30 grand… 10 grand in profit on top of that 20. And because of my ego, I just started to lose money.
Jermaine: I’m trying to think, that company while I’m talking to you, but, and over sure that I allowed myself to like lose like $2,000 and like no exit strategy, nothing to the sort.
Jermaine: And then I moved from when I, I think like burned that account down to like probably 10 grand. And then when I got to 10 grand, I’m like, hmm, something’s wrong here. I just lost a lot of money.
Clay: Yeah. Good. Once again, I’m glad you at least admitted that to yourself.
Jermaine: Oh yeah. Trust me. I tell the people that I work with right now, the truest of the story because it ends good. But I have to admit to those mistakes because I do see a lot of people makes those same mistakes today.
Jermaine: So I was jumping from people to people and I was jumping from strategy to strategy and I was jumping from a financial instrument to another. Right? So at this time I still had bonds. I still had Treasuries. So half of the money that I earned was still locked up in what I call minimal risk investments. So what I did when I got down to that 10 grand, I pulled that money out, and to this day I still regret, I called my bank and told them to wire me every single dollar that’s in my account because there’s no way that I can start losing money. I don’t understand it. So my thing was if I put more in there but become a lot less aggressive in the market, then it will be good. But I still didn’t have any sort of strategy whatsoever and… you would never believe what I did then.
Clay: So you were wiring more money into your E-Trade account?
Jermaine: Into my E-Trade account. It was crazy.
Jermaine: So what I did was I said, “Let me figure out a different strategy.” So I came across this guy called Tim Sykes and I’m not sure if I can mention that. Is that fine?
Clay: That’s fine. Worst case, you just used us both and we have to go to court… But no, I’m just kidding. It’ll be fine.
Jermaine: Yes, so that’s a true story, but… So I went and I started listening to him, started to pause, see what I was doing wrong, and see if I probably should go back to penny stocking. And I took six grand and I purchased that program that he has. I’ve watched a couple videos of it and then I never actually went back to penny stocking. So that was like six grand down. I’m like, damn. Holy shit. So sorry about that.
Clay: So you wanted to make an investment into yourself, so you thought the six grand, and then… What-
Jermaine: And teaching.
Clay: And you watched a couple of videos. What was it about the videos or whatever that made you decide that you didn’t want to do them?
Jermaine: Because it was still the chasing the market and that’s what I didn’t want to do anymore. I’m like, because I was exhausted at the end of the day. I would trade the whole day and I’m like, why am I exhausted? It does not make any sense because going over news, trading this and trading that, and I’m like, I’m tired and I cannot do the penny stocking. So I started looking into, I think two years ago after that I started looking into options.
Jermaine: So I burned… So before I even get to that, I burned through my account. I was still inside of the ClayTrader group. I had another group as well that I was in. So I was listening to several people at the same time. So when I got down to my last $5,000, that’s when I stopped trading again. I knew that something was wrong. And what I said to myself is when I trade with the simulators, what was I doing incorrectly? What I was learning I was not applying it exactly to the financial market, and that was one of my biggest mistakes. I was throwing the money around because I got complacent with it because I had it. I can make it back. Look at me. I just need to go get a job and I can make back that money.
Jermaine: So those are the kinds of thoughts that were going through my head, which are completely bad. Oh my God, I wish I could, you know, had myself step up and slap me in the face-
Clay: I know the feeling.
Jermaine: … a little bit. But that’s just the truth of what happened.
Jermaine: So at this point in time, I had absolutely no choice. I had stopped trading because I had no more money. That last $5,000, I needed to keep that. So I lost all of that and I had to step out in the market. But it’s interesting what I did after that.
Jermaine: I actually went out and tried to create a lesson program or a platform that I could actually learn from investing in the real market. So what I tried to do back then was to put every single thing that I learned in a market, all the SEC fees or any fees that apply to the market, like a pattern day trader rules, those things, because I got slammed a lot of times after I dropped below that $25,000 as well. So I started to put all those things into practice.
Jermaine: And I actually just stepped out of the market for like a year and a half, thereabouts. This was like back in the 2016, 2017, thereabouts. I stopped trading. I would like basically just like, you know, window shopping. I was window shopping the market for a whole year and a half. And I created this platform called StockGitter, and it was basically to tell people my story and to build something that people can say, “Hey, do not put your money in the market until you have actually simulated the stocks or whatever you want to do with your money on our platform called StockGitter.” Because that was my big issue, right? Because I had the money, the ego, and everything like that. I just threw it at the market rather than trying it out first somewhere else, ask a lot more questions, you know what I mean? Talk to more people before throwing the money in.
Jermaine: So that’s pretty much the biggest turning point about investing for me. And when my journey turnaround from losing money to start seriously gaining from then. And that was like the latter part of 2018 thereabouts when I got back into the market. But I got back into the market very subtly because I was, now I have a company that I started, a startup I would say. I wouldn’t say it’s a big company, but it’s a startup company that I created just to try to help people to learn from my mistakes and basically help myself in the process as well too to gain discipline. So that’s pretty much what happened to that 20 grand which was 30 grand earlier.
Clay: Yeah, that’s… So you got back into the market. So what instrument were you using? Did you hop back in with stocks? Because you had mentioned options. What were you using after you got back in?
Jermaine: I was strictly trading options. It was like I take one strategy and that’s it. I just stick one strategy and I ride that strategy. So it was… I was back in options, I was trading a little bit of money, so now I know I didn’t need to throw $10,000 and $5,000 at a stock or at an instrument to make money. I was putting like $300 and I was able to like double that money. So it was like trading the S&P religiously. I brought it up and I brought it down. I was able to, based on a lot of the research that I’ve done and watching them a lot of the options videos as well too on YouTube, is it’s all about hedging.
Jermaine: And one of the other things that I learned, it was the most valuable lessons I would say out of this 10-year run is that not because the market is there means that you have to trade. Right? Some of the best trades are no trade at all. And that’s one thing that I’ve stick to.
Jermaine: So I have a Robinhood account that I started, at least I thought I was being smart. I didn’t need to go to the big leagues. I was, you know, I can now trade with like, for no commission whatsoever. Put some money into the options market and just trade whenever there’s big moves. So that’s kind of how I started putting myself slowly back into the market now, in-between the startup company that I started.
Clay: So you are, and I guess present day, you’re still active just doing the options or have you-
Jermaine: Yes. Yes.
Clay: And-
Jermaine: I haven’t bought a stock since 2018.
Clay: All right. And you mentioned the SPY. Do you… Is that really all you trade or have you ventured out to the other stocks that you’ll trade?
Jermaine: I have. I have. I started loving Tesla because I think from the bad habit of losing money from the stock going down, I love being in put positions. So Tesla was one of the biggest things. You know, people love trading, buying shorts, selling Tesla. So I would trade the S&P 500, Tesla, Apple, and sometimes Amazon. Those are a little bit tricky to invest in. So those are the ones that I stick to religiously.
Clay: And then are you… What is your main tool? Are you using charts? Are you using fundamentals? What is your main kind of decision-making approach to do the analysis on whatever you’re actually trading?
Jermaine: So what I’ve developed for myself the past year is look for the highest vulnerability in the market and trade at that time. So the market could be skyrocketing like it was like last week or it may be trending down aggressively like three months ago. And what I do, I look at a little bit of fundamental off the market and then I’ll use a lot of technical analysis to actually execute a trade.
Jermaine: One of the one thing or two things that I use mostly is the PSAR to determine a trend and to determine an entry position. So that’s what I use religiously in terms of deciding where to enter into a stock.
Jermaine: And then I develop a strategy of not a number this time, but 10%. So to minimize my risk, I said, “Okay, I’m losing either 10% or I’m gaining 10%,” and surprisingly I’ve actually stuck to that rule. So if I get up 10% and the market is still running, I let it run. But once it starts to change trend, I exit because I’m above 10%. And the reason why I did that was because I looked at it, if I gained 10% of trading each week for one month, it is a lot more than trying to aggressively stay in the market. I admit that I’m not a longterm investor. If I’m going to do longterm investing, it’s going into like bonds and Treasuries. It’s definitely not stocks.
Jermaine: So it was coming to terms with exactly who I am into the financial market and what works for me, and not trying to chase the market but let the market come to me is kind of the strategy that I use nowadays.
Clay: I would have to agree not chasing is always a good thing. That’s a good building pillar for really any strategy. If your strategy is based on chasing, then I don’t think that’s going to be a strategy for very long. So you mentioned the PSAR, and do you have any other favorite indicators that you like to use?
Jermaine: Yeah, I use like the MACD as well too. Sometimes Bollinger bands. Those are just to determine when to get in and when to get out kind of strategies. So those are the ones that I could fully understand, so I just stick to those.
Clay: And do you, are you using multiple timeframe analysis or do you just like to use a single time frame? How many different charts are you actually looking at?
Jermaine: I use multiple. So when I’m looking to enter a trade to take profits, I’d probably look at the chart, the five-minute chart. But before getting into a stock or after or sometimes during, I look at like the one-minute chart. If I’m going to swing a trade, I’m definitely looking at the daily chart. So those are kind of movements that I make around the charts to determine what I’m going to actually do with the stock. But it’s definitely having a set goal. Like I know exactly what I’m going in to do and if it doesn’t work, get out of it.
Clay: And you said if it… not working is, was that the 8% number you said?
Jermaine: The 10%. Well, not the 10% if it looks like it’s going against that. So for example, if I’m buying a call and it looks like the stock is actually not going to go any higher, then I get out of it. So, that’s without even reaching the 10%. Once my strategy just doesn’t work, it just doesn’t look like it’s going to work, I definitely get out.
Clay: You mentioned if it doesn’t look like it’s going to go up or it’s not working, how do you define it not working? Are you… Is that based on a percentage, or I guess in your mind you need to be able to say, “Okay, it’s not working.” What is that one thing that tells your mind to say, “Hey, it’s not working?”
Jermaine: So the PSAR is what I use to tell me it’s not working. So for example, if it flips down, it means that the stock is going to go up. But if that immediately inverses, then it means that, oh, well, something else is happening in the market. Was this a freak breakout or what is going on here? So if it inverts from the original position that I bought it at, then that’s an indicator that it’s not working, that strategy’s not working for me, so I need to get out.
Clay: All right. So that makes sense, and that’s… Because, as I’m sure you now realize that it’s always one thing where people, they say stuff, or like, okay, that’s a good sound bite, but how do you actually define what you’re saying? Things are not working out. Okay, well how do you know? But in your case, that was, yeah, that makes sense. It’s the PSAR that you’re using as your driving tool. How long, or I guess, are you a day trader? Are you a swing trader? How long do these trades usually take?
Jermaine: Yeah, I’m definitely a day trader, and because I’m mostly focused on driving the company that I’ve started, which it’s starting to do really good, I only get into trades as I said before, when the market is really defined. If it’s really going up or if it’s really going down, that’s when I trade, because I’m always in the market because that’s what StockGitter is. It’s centered around financial investment games and helping people to understand the market. So I’m always there. So I know when something is happening and I just open my brokerage account and jump in. So that’s kind of what I’m centered around on a daily basis. But I’m definitely a day trader.
Jermaine: A lot of times I’ll swing trade, but I definitely don’t swing trade over a weekend simply because there’s too much that can happen, especially now with the trade deal, that’s kind of slightly gone for now, but that was kind of a lot of factors that were playing with the market, in my opinion, were kind of pushing out the fundamental, the technical side of it a lot. So I couldn’t definitively stay in a swing trade for long. So I definitely do a lot more day trading and that’s just getting in for a couple minutes or even for the day, and that’s it.
Clay: And I fully agree, especially over the weekend. That’s just even more time for crazy stuff to happen. It’s already, you hold over one night and in this environment right now, all it takes is one tweet or one headline and then things can change-
Jermaine: Precisely.
Clay: … but let alone a weekend, and it’s like, all right, well that’s even an extra day where things to get, or an extra two days for things to get crazy.
Jermaine: Right.
Clay: So that makes a whole lot of sense. And when you’re, I guess… it sounds like you’re not trading every single day. You’re only trading when big dynamics are occurring. Is that-
Jermaine: Yes.
Clay: All right. So how often do you find yourself actually trading, I don’t know. Let’s say per week. are you trading just a couple of days per week, or is it really, is it kind of all over the map? It just depends on what’s what’s actually occurring from a macro level?
Jermaine: It’s definitely at least four times per month that I would trade. And that could, sporadic be, it could be four times within one week or it could be four times over a three-week period. But that’s on average the amount of trades that I do per month now. Because you know a lot of it, when I started the company, that’s what I put a lot of the capital that I earned into making that a real business. So what I trade is basically just money that I have just sitting there in that investment account that I’m definitely not going to lose this time around. So I just wait until a good definitive trend. I get in and I make some money and I sell. I’m out of it.
Clay: Got you. Okay. So that makes sense then. Do you have any goals say that you want to trade more, or are you just kind of taking it as you’re happy with the amount that you’re actually trading right now?
Jermaine: No, I have basically two goals. One, I’m basically, I’m in a different phase of my life right now. I actually bought a house, a fixer upper. It goes back to my living lean again. I bought a rundown house, so like a couple blocks from the city, and fixing it up myself. So I’m definitely trying to get that done. I’m almost ready to move into that. And then I’m trying to actually save up enough money so that I can actually quit my job, my day job, because you know, I’m not a cubicle guy. So I’m looking forward to the day that I can go back to trading full time. But throughout this process I’m using it to develop discipline, find a strategy that works. The great thing about it is that I know who to listen to these days and who not to listen to. And you know, all my previous mistakes have now become some of my best assets today. So my goal by age 45 at least, is to be able to start fully trading once more so I don’t have to do the cubicle thing anymore.
Clay: Right. And I like… That’s really the main battle is who actually is giving good information? Who should I be listening to? What is actually accurate? Or what should I be ignoring? Or what should I be kind skeptical of? And when you’re new and you don’t know what you don’t know, that could definitely be a big headache. So, that’s true. When you brought that up, I was, yeah, that’s actually very important. Not for trading, but really for anything. You want to make sure that you’re listening to the right people or else that can really send you down rabbit holes that you don’t want to go down. And then not that you can never recover, but bad habits are built, and then bad habits are so much more annoying to break then just kind of starting with not even having them in the first place.
Clay: Maybe… Who is your broker? Is it still E-Trade or did you transition to somebody else? Because I know that’s always a popular question as, you know, from a listener’s perspective. Are you still with E-Trade?
Jermaine: I still have E-Trade as a backup, but because I’m always on the go nowadays and I’m trading while I’m at work, so it’s easier to use a phone. I use the best apps that are simple to use. And I hate to say it, but you know, Robinhood is pretty easy. And I found that whichever platform that can give you that good feeling in terms of executing a trade, you know the process back to back, you know how to determine an entry point and who executes trades a lot quicker. And I use Robinhood a lot. My backup would be tastytrade and because sometime I do get back into those pattern day trader rules simply because I still haven’t put $25,000 back into the market. I use three accounts, basically. I use Robinhood, tastytrade, and E-Trade. E-Trade is usually the last one to use though.
Clay: All right. So plan A, Robinhood, plan B tastyworks, and then plan C, E-Trade. All right. Well, that makes sense. And then you have… And it sounds like the core thing that you were using as you just liked those apps from a phone perspective?
Jermaine: Yeah. And honestly the only reason why I put money back into E-Trade was when they went to zero commission. Why pay for commission when all these apps are out there?
Clay: Yeah, no, exactly. They’ve all definitely changed the game. It’s a good problem to have from a consumer standpoint when all these brokers keep throwing haymakers at each other, trying to knock each other out with, “Oh yeah? Well, we’ll do this.” “Oh yeah? Well, take this.”
Jermaine: I love it.
Clay: And it’s like, all right, this is… Yeah. Exactly. this is good. This is good. Free markets are definitely a good thing.
Clay: Well, I’m looking at the clock here. We’ll start to wrap things up.
Jermaine: Sure.
Clay: And given that you’ve never listened, you’re not aware, but we have a time machine here on the podcast. What we like to do is we lend this time machine to our guest and we let them take it back to the start of all their journey. So if you could do that, take a time machine back to the start of all this, what would be one bit of advice that you’d give yourself?
Jermaine: Don’t be too hasty. Not because you get good advice means that you need to throw your money at it. It’s all about a process. Everything is a process. And if you just take the time out to go through that process and learn a little bit before throwing your money at it, you’ll actually turn out to be better. Well, you don’t have to start over like I did.
Clay: Yes, it can be a much more cost effective way to go about it, for sure. So in other words, patience, it sounds like would be the one thing that you just tell yourself. But it is hard.
Jermaine: It is sometimes.
Clay: The stock market, the financial markets as a whole are just, they’re pretty mind blowing when you stop and think about, wow, I can make money sitting at home pressing buttons, and they can suck you right in. And it’s very easy to go way to… you said, it’s very easy to be hasty, but you don’t want to be too hasty. You got to just slow down. But I think we’d both agree, probably much easier said than done.
Jermaine: It is. It is. That’s for sure. I actually took the harder way, so I know it’s definitely easier said than done. But what I’m hoping to do is the time that I took to build a startup company to make that a little bit more vigilant to people, it’s bringing those stories out to people so they can see it that, hey, try this first before you put your real money in there and see if it works. If you can’t go three months with it, you’re probably going to lose your money.
Clay: Yeah. And three months is, yeah, bare minimum at least because it… The simulator world, the paper trading world, it has a weird way of kind of helping to build false hope. But yeah, definitely, definitely good. So I’m a fan of that advice that you’d give yourself. Just you know what, slow down a little bit.
Jermaine: Slow down. Yup.
Clay: Before we wrap things up though, we’re going to get a little more lighthearted here and some fun questions. So Jermaine, what is your favorite movie? I got a guess, and this, I don’t know. Hopefully this doesn’t offend you, but is your favorite movie Cool Runnings?
Jermaine: No.
Clay: Because that’s one of my, that’s a great movie and that’s all I can really think of is, I bet Jermaine likes… Have you ever seen Cool Runnings?
Jermaine: The funny thing is I didn’t see Cool Runnings until I migrated to America.
Clay: Oh, really?
Jermaine: So it’s definitely not one my favorite, but it was pretty good. When I watched it it was like really nice. I loved that those guys never gave up. Which is kind of probably who I am too, but actually love The Others. It’s a scary movie. It’s one of the scariest movies that I’ve ever watched and I had to turn the TV off at night and watch it the following day in bright sunlight.
Clay: You know a movie is doing its job if, yeah, you have to do exactly what you needed to do. Nope. I’m going to wait until it’s bright outside, birds are chirping, there’s a rainbow, and yeah, exactly. Then mission accomplished. And you said it was The Others?
Jermaine: The Others. Yeah. That definitely got me.
Clay: All right.
Jermaine: That’s why I love it.
Clay: Nice. Nice. Well, well done to The Others then because I don’t like horror movies so I will never watch The Others. I’ll just take your word for it. What about food? What is your favorite food?
Jermaine: Oh, my finger food. Plantains. I love fried plantains. if you ever come to my house, there always plantains here.
Clay: Always… Excellent. Well, those are like bananas, right?
Jermaine: Yeah, they are like bananas, just a little bit sweeter.
Clay: Well, I like bananas. I think I’ve had plantains before, but regardless, I’ll keep that in mind. If I’m ever in Jermaine’s neck of the woods, I’ll make sure to knock and be like, “Hey, let me try some of these. Let me try some of these plantains.”
Clay: And then final question, what do you like to do for hobby and fun outside of the markets, outside of just life in general?
Jermaine: Yeah, life in general. Anything that gets me away from computers, that’s what I like to do. So I like doing renovations on houses. So yeah, buy them cheap and I fix them up in my spare time. I also like cooking as well too. Occasionally I would travel a lot, but I’ve been kind of building a foundation here so I haven’t traveled much recently. But yeah, those are pretty much what I do. And the regular stuff, hanging out with friends, movies, you know, going out to actual activities, like outdoor activities. I want to try skiing because I never tried it since I’ve been in the States. And, in the North-
Clay: You should totally try bobsledding.
Jermaine: I should. Yeah. I’m going-
Clay: You’d be a great bobsledder, I bet.
Jermaine: Well, I love speed and risk-taking.
Clay: There you go. There you go. I think it’s a natural fit.
Jermaine: It is. Yes, completely right.
Clay: Well, that sounds like you and Nate would get… Nate, for listeners, Nate is the producer, but he’s an IT guy here at ClayTrader.com and he loves to fix up houses.
Jermaine: Cool.
Clay: He’s working on a second flip right now where-
Jermaine: Nice.
Clay: … he moved in. I think he’s crazy, but I don’t know. Maybe it is some of those IT guys, they just want to get away from the computer every now and then, so why not get their hands dirty a little bit-
Jermaine: Oh, yeah.
Clay: … get some blisters, and build-
Jermaine: It’s fun.
Clay: … Yeah. Build some sweat equity into things.
Clay: Final question here. Three words, and these three words need to be what you would associate with what it takes to be a successful trader.
Jermaine: Patience. I would say is decisiveness, and diligence, I want to say. Make sure you check it out. Double check.
Clay: Yeah, no. That… Patience, diligence, and what was your middle word? I already forgot. Persistence? No.
Jermaine: Patience, and-
Clay: Oh, decisiveness.
Jermaine: Decisiveness. Yes.
Clay: There you go.
Jermaine: Don’t waver. If you want to get out, get out.
Clay: Oh, you’ve got to be decisive. That’s one thing that you got to just be able to make a decision and go with the decision for sure.
Clay: Well, Jermaine, we’re basically nailed this right where it needed to be nailed at an hour, and I got to just commend you. Well done. Especially with the whole living aggressively. I’ve never heard that term used before, but to me that was good stuff, man. So-
Jermaine: Yeah. No problem.
Clay: Yeah, keep on grinding, man. And congratulations on the house. It sounds like you’re going to be building some really good sweat equity into that thing.
Jermaine: Yeah. Definitely.
Clay: You got to just keep on, keep on, keep on, keep on, and I guess is the best way to go about it at this point because you’re not coming up with many excuses. It sounds like you’re-
Jermaine: No.
Clay: … focused on the solution, not the problem-
Jermaine: Always.
Clay: … and that’s the way it’s got to be.
Clay: Well, Jermaine, I also wanted to thank you for volunteering to be here. That always makes life easier on my end-
Jermaine: Yeah, definitely.
Clay: … where I don’t have to kick and drag people. So thank you for taking some time out of your evening to be here and I appreciate you swinging by.
Jermaine: Definitely. And it was a no-brainer for me to volunteer even though I haven’t been very active in the group for a while. It was because you were one of the decisions that I made to get back into the market. So it was easy to say, “Hey, I’ll come and talk about my journey. It’s not pretty, but I would definitely come and talk about it.”
Clay: Well, I appreciate it and I thank you again for hanging out.
Jermaine: Thank you.
Clay: All right, now for you listeners, before you go, a final few things. First off, if you’re at ClayTrader.com on the show notes page, down in the right hand corner, there’s a little live chat box. You can click on that and if you want to leave questions, comments, suggestions, we love to hear from you. If you’re on iTunes or on Spotify or any other podcast players, make sure to subscribe, and especially on iTunes, if you could leave us a rating or better yet a written review, we would really appreciate it and little things like that go a long way. So, thank you in advance if you’re able to take some time out of your day, all 10 seconds, and do something like that. Like I said, it really helps out. So thank you, again, to all of you as viewers. Thank you, Jermaine, and we will see you back next week.
Announcer: This has been The Stock Trading Reality Podcast. Thanks for taking the time to hang out. To learn more about Clay and the Clay Trader community, including the trading team, premium training, and more, visit ClayTrader.com.