Transcript

Clay: Hey, it’s Clay. Real quick before I get to the episode, I want to bring to your attention one of the most common questions I get, and it’s a wise question. It’s something that makes sense to be asking. “Hey, Clay, what is a good broker for a beginner? I want to trade stocks. What would you recommend, ideally, if it’s got zero commissions?” and that would be Webull. They’re a fantastic platform, and what I like to apply is known as the platform HAT method, H-A-T. First of, the H: does the platform give you the ability to hunt for stocks, to find good stocks? Webull absolutely does.
Clay: The A, the analysis: does a platform give you the ability to analyze whatever stocks you have hunted and found? With Webull, it absolutely does. And then, the T, take action. You can hunt out stocks. You can run analysis on them. But, if you can’t actually take action and put everything into motion, well, then a platform is not going to do you very much good. But, once again, Webull is very, very beneficial for allowing you to take action with whatever sort of stocks and then strategies you’re looking to take advantage of.
Clay: So, are they the be-all-end-all? They’re not. There’s lots of good platforms out there. But, when it comes to the quality of charts they give, when it comes to the $0 commissions and the ease at which you can sign up … They have a great app for your phone. I would say at least give them a try, so go to claytrader.com/Webull and you can learn more all about them. But, let’s now get to the episode. This is The Stock Trading Reality Podcast episode 324.
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. This is your host. Should the next meetup be in Dubai? He’s wondering, Clay Trader.
Clay: No, I got this idea from somebody that joined the community. They are in Dubai and they made the comment, “Hey, if you’re ever around, let me know. If you ever do a meetup, let me know. I’d love to help out,” and that got me thinking, “Dubai, the place where they create islands out of nothing, the place where they’ve got a bunch of fantastic awesome buildings,” and I’m thinking, “You know, maybe the next meetup should be in Dubai,” so I am definitely wondering that. But, I’m also wondering, “When oh when are things going to get back to quote/unquote normal where I don’t have to worry and there’s no risk involved where you put in a whole bunch of time and effort to plan things out, to get everything aligned, and then, I don’t know, something gets changed or something gets canceled or some sort of dynamic occurs within the world, and, all of a sudden, well, now you can’t have more than 10 people meet up or something?” randomness like that.
Clay: So, there will be more meetups. It’s been a while since we’ve done any in-person meetups of the community, but who knows? I suppose never say never. Maybe the next one will be in Dubai. Maybe that member that made the offer will significantly and severely regret that decision to throw up and say, “Hey, you know, I’ll throw up my arm and say I’ll help out.” So, that may be a regretful decision, but we will see what happen. But, I am definitely wondering, should the next meetup be in Dubai?
Clay: Well, for our conversation today, some good stuff and a very rare event, maybe the first. I don’t want to say that. We’re up over 300 episodes now … but one of the very, very few. I’m confident in saying that where I would say, “You know, I’m not quite sure those are excuses that are just flat out excuses,” a situation where it’s like, “No, I can totally understand where you’re coming from. I can totally understand why you have an attitude that you might have, why you maybe view certain things the way you do.” But, even with that, Jacob, our guest from the community still doesn’t have that outlook.
Clay: At no point did he throw up a victim card. At no point did he throw up excuses. He just pretty much was like, “Yeah, you know, this is the situation and it’s rough.” Spoiler alert, there’s some health things going on and it is rough. There’s no doubt about it, and it’s not like it’s just completely, “Oh, well you could do …” no, he’s been even trying to get solutions to the health issue via multiple surgeries. It’s just a rough situation and it will play out during the discussion. However, even with all of that, he’s not going to, “Woe is me. I can’t do anything.” His mindset is not using the word can’t but how, “How could I still make things happen?” That’s where he’s turned to … Well, I don’t want to give his story away, but let’s just get to it. However, this is pure motivation. When you think about how truly rough this guy’s situation is, but he’s still not throwing up any excuses. So, let’s get to Jacob and his story. Jacob, welcome to the show.
Jacob: Good morning.
Clay: So, it’s morning where you are. Where actually are you located?
Jacob: Just outside of Tulsa, Oklahoma in Sapulpa, Oklahoma.
Clay: Okay, that’s Central Time, right?
Jacob: Yeah.
Clay: So, it’s about 10:00 for you, then, all right, excellent. You said you listened to many episodes before, and, as you just witnessed, we hopped on, made sure the software worked. I went through a quick introduction and we are now talking. So, can you confirm, Jacob, that, from this point going forward, none of this is scripted at all?
Jacob: No, absolutely not.
Clay: I think some people are taken aback like, “Jeez, there’s no small talk or anything.” It was pretty much just, “Hey, here’s how it works, boom, boom, boom,” and then we get started.
Jacob: Well, it’s probably better that way, the ripping-of-the-bandaid effect. I’m pretty nervous, so it’s good to just, I guess, hit the ground running.
Clay: Oh, well you’re doing fantastic already, so nothing to be nervous about at all. I feel like I vague … I recognize your name and I also feel like you … I don’t want to say you’re in there all the time, but you do participate in the chatroom, don’t you?
Jacob: Not much, lately [inaudible 00:06:09] when I first came on for a little bit, and then I haven’t for quite a while.
Clay: Okay, all right, so maybe you’re not who-
Jacob: There’s another Jake in there though that’s in there a lot.
Clay: All right, that might be where I’m coming from, then. Pointer being-
Jacob: He’s got the Georgia bulldog on his-
Clay: Yes, okay, that’s not you, then.
Jacob: No.
Clay: Okay, gotcha, then that is actually who I was thinking of. I’m kind of just going through that for those of you listeners out there to set up the context that that’s what this show is all about. It’s not scripted. I just want it to be as genuine and as realistic as possible of just a couple traders sitting down and hanging out and you get to be a fly on the wall of our discussion. So, with that being said, where did all this start for you? Where did you hear about the markets? What sort of things played out that brought you to the point where you’re like, “You know, yeah, I want to get a little bit more hands-on with that and I want to take a little bit more control of things?”
Jacob: A little bit of a long story: my uncle was an executive at a company, and he was in the market from when I was young, so I always knew the market existed and, roughly, you bought shares and sell high and [inaudible 00:07:19] then, throughout the years, my mind would wander to it, be like, “Wouldn’t that be great to do that?” But, I never had any funds, resources to do anything like that. We grew up relatively poor, probably, I guess you’d say, so just mostly manual labor and stuff. I never really went to college [inaudible 00:07:39] so I just was going along to get along. And then, my grandmother passed away, and she had a relatively significant amount of money and left to me, my father and my brother some money. My wife and I put that into an account with a Raymond James guy, and it sat there and I tried to stay involved with it if I could, but-
Clay: Wait, what year was that, just to build somewhat of a timeline, here?
Jacob: It was about seven years ago.
Clay: Okay, okay.
Jacob: I’m not great with looking back at time.
Clay: That’s fine. I just want to make sure: was this a couple years ago, five years ago, 20 years ago?
Jacob: No.
Clay: So, sevenish. We’ll use the ish to keep you safe there, so sevenish years ago.
Jacob: A lot of ishes, okay. And so, I had ideas and stuff, but it was understood that I wouldn’t really do anything unless it was approved by our handler or whatever. I wasn’t happy. A lot of changes were happening in my life recently. So, we’re talking about towards the end of last year, towards the end of ’20, say October, we decided that we were going to [inaudible 00:09:06] money from him and I was going to try to manage it and we were going to … I was going to not be a day trader specifically because I didn’t even know enough to be that dangerous. I was just going to take control of this and we were going to make money with it.
Clay: Okay, you took the money from him because you were just not happy with the returns you were seeing?
Jacob: Yeah, and I just wasn’t happy with … It’s kind of subtle, but a couple things I wanted to get into and he steered me away from them, and they actually ended up being … It’s like, “Oh, you should have bought that.” And then, he steered me out of something I really wanted to keep. It ended up blowing up later and it was the kind of thing where we all had to sell out so he could [inaudible 00:09:49] his shares. I didn’t really feel like he had my best interests, and yes, the returns after five years or so was not … wasn’t okay.
Clay: Are you willing to talk a little bit more about that? I think there might be some learning lessons for listeners that are … You don’t have to answer, but what did you want to put your money in, and then he steered you away from doing it?
Jacob: One of them, I was like, “Well, why’s Netflix so cheap?” It was a little over $100 at that point and he was like, “Everybody’s already gotten into [inaudible 00:10:29] everybody’s portfolio.” I was like, I don’t know, I kind of really like them. Lockheed, I thought that was a great idea, and he just wanted me to stay in this kind of fund-
Clay: Was it funds? Was he in fund? Did he have your money in funds?
Jacob: He had it at American Eagle [inaudible 00:10:48] longterm growth fund.
Clay: You’ve said enough to make the point here that I suspected was there. Let me tread carefully because I don’t want to disrespect people. But, at the same time, I will kind of disrespect people because it’s kind of how things go, and I can’t say that I’m shocked at all. But, financial advisors, your interests are not the top interest, and we have another classic example of that. Think about it. Jacob was like, “Yeah, I see these individual stocks that I would like to put some of my money into,” but what did the visor … “No, no, no, let’s keep them in the funds.” I have a sneaky, sneaky suspicion that those funds were some sort of … It benefited him in some way, shape or form to keep your money in that fund.
Jacob: Oh, absolutely, and I kind of figured that out later. I was like, “Okay, I get it.”
Clay: Okay, so that was the case, then. By him keeping your money in that fund, he was benefiting from it, then?
Jacob: Yeah, I’m sure of it.
Clay: Okay, we’ve actually had financial advisors on the podcast before. I guess can’t say every single one because I don’t remember the details each time, but I do know that, at the end of the day, it’s more of not necessarily a financial wizard. It’s more of a salesperson, and they’re trying to sell. They’re trying to sell certain products, certain funds that benefit them and their company. So, that’s just something to keep in mind. I’m not saying that every single one of them is a scumbag. I’m not saying that any of them are really scumbags. I’m just saying that the business model is set up in a way where, are they really going to do absolutely what’s in your best interest? Well, no, because they work for a for-profit company, and that’s a perfect example. “Hey, I like Lockheed Martin. Hey, I like Netflix.” “Well, no, no, no, no, no, no,” and they came up with some sort of excuse, it sounded like.
Jacob: Kind of.
Clay: As opposed to saying, “No, no, no, I can’t do that because then I got to take money out of the fund and that’s not going to benefit my company and me,” so they came up with some excuse about, “What was Netflix? Oh, well everybody’s already in that stock.”
Jacob: Yeah, I think it had gone down. They did something stupid, and this was before I had the money. I would have bought a whole bunch of it. Later, it had gone back up to $100, and everybody in the world was invested in it. He just was like, “Well, everybody already owns that one, it seems like.”
Clay: Interesting, well, thank you for opening up there because that’s a great lesson there on … Again, I’m not saying you should not use a financial advisor. I’m just saying if you have conviction and you want to do something and your financial advisor is like, “No, no, keep the money in the fund in the fund …” It is tricky territory, because if you’re like-
Jacob: It is, but it’s your money, ultimately, and that’s what I didn’t really go to bat for myself either with him or with my wife because she didn’t really trust me to do it, and she’s kind of right not to. It’s a tricky thing with money and everybody’s looking out for number one, so-
Clay: No, you’re absolutely right. There’s so much great territory. I would argue your wife was being rationale to think-
Jacob: Very.
Clay: No, no, no, you’re not the financial professional here, right? He’s the financial professional. That’s fair. That’s true. But, at the end of the day, I would argue Lockheed Martin, Netflix, not exactly the craziest things, even with hindsight. Even if you had said back then, “I want to go all in on some crypto,” I get it, yes, right now, that could be like, “Oh, that’s genius.” Yeah, but at that time, if you’re being honest with yourself, that would have been a situation where it was like, “Yeah, that was really risky,” or some sort of random penny stock. And, even if that penny stock had worked out, that’s still super risky at that time. I’d say, “Okay, I can see why the guy would be encouraging you to not do that.” But, Lockheed Martin, Netflix, give me a break. These aren’t exactly sketchy startup companies at that point. Anyways, all right, that all makes sense on why you would eventually just say, “You know what, let me take back the money, put it in my hands,” and that’s where we left off, there. So, where did you go from that point?
Jacob: Okay, from that point on, it’s just completely up, down, rocky. That set me on my journey of learning and everything to get me where I’m currently just kind of getting it and keeping my head above water.
Clay: Okay, well let’s dig into there, up, down [crosstalk 00:15:30] you get the money. What’s the first thing that … What did you think you were going to do with it? Did you think you were going to be a day trader? Were you thinking you wanted to swing trade? What was the game plan as soon as you got the money back from the Raymond James guy.
Jacob: Okay, I have no idea what any of this stuff actually is, so when I say, “I’m going to manage my money,” in my head, I don’t have any kind of description for that … ultimately probably woulda been swing trading was what my head was thinking, but I was just going to buy and sell stocks.
Clay: Okay, yes, and that’s the tricky part because, at the time, I’m assuming you probably thought you knew what you were doing, right?
Jacob: I knew I could figure it out.
Clay: Okay, but where you sit now with knowledge and hindsight, you look back and you’re like … you were probably just like, “Yeah, I really didn’t actually have a plan.”
Jacob: Oh, complete moron.
Clay: Yeah, but that’s what’s so tricky because, at that exact moment in time, it’s not like you’re sitting there saying, “Oh, man, I’m a total moron. Yeah, let me get the money out.” No, that wouldn’t make any rational sense. At the time, of course you think you have a plan and you think you can figure it out and all of that. So, at the time, if you had a … Obviously, at the time, you didn’t sit there and say, “I’m going to be a swing trader,” but, in your mind, that’s what you were probably thinking that you wanted to do?
Jacob: So, we put the money in with TD Ameritrade people, who, my wife works with them. Anyway, we knew them, good people, put my money with them, got set up with the website, not even Thinkorswim, just the advisor client, and I started trading stocks, buying and selling stocks. I just went nuts.
Clay: What was your criteria at that point for buying?
Jacob: It was [inaudible 00:17:13] I was researching. I was on that website researching these companies and getting a pretty good idea of value. So, I would buy. I’m evaluating these stocks for a longterm trading idea, but I’m not trading them that way.
Clay: Yeah.
Jacob: I’m day trading stocks that I’m analyzing for yearlong … I was all over the place, really no grounding at all.
Clay: You would go do all this research looking at cashflow statements and income and all that sort of stuff, to your point, researching for the long haul. Were you just saying that in general, or were you literally day trading some of these stocks where you would buy and sell the same day?
Jacob: Literally day trading some of these stocks.
Clay: That’s good stuff.
Jacob: I got in trouble for freeriding.
Clay: I was going to say that was probably the next part, was you probably learned about the PDT rule real quick.
Jacob: Yeah.
Clay: I realize this was years ago, but it’s just kind of a fascinating thing in a comical way. Do you remember how your brain was justifying this stuff?
Jacob: Oh, man.
Clay: You had just done all this research that was geared around, “Hey, this is a great company for the long haul. This is looking great. I love the horizon for this thing.” Do you remember, how did your mind all of a sudden justify buying and then selling in the same exact day?
Jacob: No, I really can’t.
Clay: Were these winning trades? My guess is these were winning trades that you were day trading. Was that true? Were you making money on these?
Jacob: I was making money on some and not making money on others.
Clay: Interesting.
Jacob: Nothing happened to me to scare me, really, initially.
Clay: I can see you day trading because you’re like, “I did this research. Oh, wow, I’m actually up some money. Well, that’s cool. I’m up some money. Let me just sell.” But, I could also see, if you start to lose money, then you’re like, “Well, I’m not going to sell because this was longterm research.” But, for you, you were taking losses and taking wins from a day trading standpoint, so that’s kind of bizarre.
Jacob: There’s really no rationality to it at all. Looking back, it’s just really dumbfounding what my thought process-
Clay: Had you heard of day trading at that time?
Jacob: I was starting to figure it out.
Clay: Yeah, because I could say, “Well, yeah, I’m actually a day trader now.”
Jacob: Yes, I did come along. I came to that conclusion at one point, is I am a day trader, yes, I’m day trading. And then, it got worse at that point because then I was actually trying to day trade and really-
Clay: So, how did you come across day trading? At this point, even though it’s not matching up with what you’re saying and thinking you’re going to do, bug you’re thinking, “I want to do the research for more of a swing trader type thing,” and now, all of a sudden, you’re into day trading. So, did some day trading video randomly pop up? Where did that connection come from?
Jacob: Well, it’s kind of because that was really what I was already doing, and I had heard the term day trader before, although I didn’t really know what it was. Then, I started … I read a book on day trading, and that’s kind of when I think I made that switch, “This is what I’m going to do. This is what I want to do, is do this day trading, this monthly income daily process.” I had been searching on YouTube and I had come across … I don’t know if you’ve ever seen it on there. It’s called the Humbled Trader, and I watched a few of hers and then watched a couple other guys. That’s when I came across ClayTrader, watching you do some of your daily stuff.
Clay: And then, from there, it was like, “Okay, this is what day trading is, and I want to go and do that?”
Jacob: Yeah, this is different.
Clay: And then, that’s when you started to … It sounds like you got even crazier with your day trades, then?
Jacob: Yeah, really. It’s kind of all a blur, looking back. I’m not sure exactly when things happened in my mind because it really is kind of blurry, but I had already decided that that’s what I was going to do. And then, I didn’t have any direction or anything at all until I came across the claytrader.com. I watched something, and then, it was like that very day. It was the next day that was Thursday and I went to the webinar. And then, that very next day, I paid the $130-something, and I was going to slow roll into the TFB program.
Clay: The pay-as-you-go plan, you did?
Jacob: Yeah.
Clay: Okay. Just for context’s sake-
Jacob: Which was dumb.
Clay: I’ll ask why that was dumb in a second here, but, before I forget this part, were you working a day job or did you just quit so that you could start to do all this trading? What was the job situation while you were out there acting like, quite frankly, a madman, it sounds like, with all this trading?
Jacob: Oh, yeah, I had way too much time on my hands, man. I have had like six back surgeries, and that started way back in 2008. And so, I’ve done all kinds of stuff, manual labor type stuff. I had a carpet cleaning company for a while. I worked in restaurants when I was young. I did a lot of AV work. I actually worked for a long time for ABC and ESPN doing the college football games around OU and OSU with the filming crews. But, I had back problems kind of when I was young. It just finally got to the point where it went out and these discs were completely blown. Nothing was going to fix it. I just had to go in and start getting fusions.
Jacob: And so, that went on for several years. I even went back to school to do nondestructive testing, which is a great career that very few people find themselves in. But, I actually got a job out of there working at ST Aerospace in San Antonio doing nondestructive testing on aircraft. Basically, you’re just testing parts that are inservice for corrosion or cracks or doing radiography or ultrasound. It’s really cool.
Clay: Oh, yeah, I remember when I worked at the Honeywell plant back in the day when I was doing engineering stuff. That was super cool stuff. What do we call, it, the NDT?
Jacob: NDT.
Clay: All the radiography, all that sort of stuff in the welds looking for bubbles, just stuff like that. That’s really fascinating stuff. Yeah, that’s awesome.
Jacob: It was really cool. It was good money and I really found my niche there. I’m kind of a science guy based in my mind and I love numbers and concepts and things like that, using that equipment and doing the calculating and all of that stuff, that was just great. Long story short as I can make it: when they were doing the surgeries in Tulsa, they weren’t doing them right. They didn’t get it right, and so, still having back problems, still seeing doctors. My wife found a doctor in San Antonio that I was going to when I was working there and finally came back to me and says, “Okay, we have to redo the two that they did and we have to do two more.” At that point, it just wasn’t going to work. I was barely hanging on. I was in the taking-a-lot-of-pain-meds place. I don’t know how to explain it. It just was gone.
Clay: No, I think you’ve explained it. That’s just a crappy situation.
Jacob: I had not really been working for almost five years and I never applied for disability or anything. I was still trying to make it. And then, after that surgery, I went ahead and applied for disability and ended up getting it, not a lot, around $1,000 a month or so, just enough to help. But fortunately, when my grandma had left me that money, we paid off everything. We bought a house. We paid off our cars, so we were not in a position to really be hurting that bad. We were still living and still doing okay, but not much of a future. So, this day trading was going to change my life.
Clay: Okay, this was not like you were doing anything where you were sneaking away to make these day trades. You had the time to do it, which-
Jacob: Too much time.
Clay: Yeah, I was going to … I think you pinpointed that. Sometimes having time can just be too much time, and, before you know it, you’re just flinging money all over the place. So, you signed up for the class. You came across things. This was, are you guessing yearish ago?
Jacob: This was May 20th when I sent the first hundred and whatever it is, hundred and some dollars to you.
Clay: Oh, wow, so, as we’re recording this, basically a year ago. At that point, was your game plan, “I’m going to stop trading or I’m going to keep trading?” How were you approaching this new leaf that you had turned over and said, “All right, let’s try to bring some structure to everything.”
Jacob: Well, no, here’s part of my problem, too. I’m always a week from figuring it out. [inaudible 00:27:11] ultimately, I usually have been able to come across something new and just dig in and eventually figure it out and be pretty good at it. It just continued to be … “I’m not broke yet. I still have some money. Yeah, okay, I lost a grand that month, but I’ve still got money. I’m still going to figure this out and I still believe this is going to happen.” When I first got my … not TD Ameritrade, but the Thinkorswim, I did paper trade for several weeks. It went okay, but again, it was just kind of like it’s just not real. It was more like playing a game or doing a sim, but nothing … It was okay. I would just buy what I wanted with no pressure and everything was kind of going okay. And then, I started live trading again with the TD, with the Thinkorswim, wasn’t happy with them, went to IBKR, and then that software, wasn’t happy with that, either. Then, I ended up getting my Lightspeed account, trading the whole time.
Clay: This is while you were going through the class, or is this before you signed up for the class?
Jacob: This was while I’m going through the class.
Clay: Okay, so you’re just … and I mean …
Jacob: I think I got my IBKR about the same time I signed up, so I had been doing Thinkorswim without the class.
Clay: Okay. So, are we pretty much caught up to present day or is there-
Jacob: Basically, that gets me to present day. I could describe how-
Clay: I’m just curious, as you were going through the classes, were you trying to implement what you were learning or were you still just doing … Take me through that. I’m curious.
Jacob: So, I was trying to implement what I was learning, and my problem wasn’t necessarily an understanding of the chart. I pick up on that stuff, it seems like, fairly well, fairly quickly. Mine was psychological and emotional. I remember one thing you said was, “If you’ve got a noble cause, too bad, because that’s absolutely worthless,” but I had a noble cause and I had this need to make this work and this fear that it’s not going to. I would buy everything at exactly the wrong time, so I would wait for these … I couldn’t pick up on the subtly of it because I couldn’t allow myself to … I was in a constant knot. I was a constant stress ball trying to make this work.
Jacob: I was understanding the charts and then having no idea why I couldn’t make that bull pole work or why that break didn’t work, and I wasn’t doing any of the little things. I didn’t have any good habits and I had some pretty bad habits. I was just locked in my head doing this horrible disservice to myself to the tune of $1,000-$1,500 a month for several months on end.
Clay: Losing, I’m assuming you’re saying.
Jacob: Yeah.
Clay: Okay.
Jacob: All red, just bleeding the whole time.
Clay: Where do you stand right now? I don’t want to … If you want to take us on any other little rabbit holes along the journey to where you are right now, that’s fine too.
Jacob: I’ll tell you anything. I got nothing to hide here, man. I’ve really gotten a lot out of listening to other people, and a lot of people have confessed to some pretty stupid things, so I don’t mind.
Clay: Yeah, there’s really two traders out there, those that have done stupid things and then liars. That’s the two categories.
Jacob: I know that what finally got me was I ended up at the end of the day; I’m just making myself feel horrible and I was going to make this Tesla trade, and whatever will be will be. I’m going to do 100 shares or whatever it was that day. If I lose $2,500, so be it. If I get $2,500, well that’s kind of what I need. And so, after that day, I thought to myself … I finally pinpointed, “This is all you, man. You may not be …” Up until then, I knew that I would eventually be able to do it, and it wasn’t til that day I realized, “Yeah, man, you’ve got the cognitive skills to do that, but you may not be able to pull this off because you can’t get out of your own head, and it’s bad. It’s really bad.”
Clay: Did you make that Tesla trade?
Jacob: Oh, yeah, I did and I lost $1,200 bucks on it.
Clay: Okay, so your whole-
Jacob: It was after that day.
Clay: Pretty much go all in and whatever happens … not necessarily all in, but I know what you’re saying, is, “Hey, just make the trade and whatever. It is what it is.”
Jacob: I was angry. I was upset. I was irrational and I was just going to do it because I needed basically $2,500 bucks back.
Clay: Was this after a day where you had already taken some losses?
Jacob: Yes.
Clay: Okay, so the day had already not been kind to you, and then it just compounded. So, what you’re saying is, after that trade ended, that’s when you had that little light bulb moment that you just had to look in the mirror and be like, “I got to get my mind under control.” Is that a fair summary of how that went?
Jacob: Mm-hmm (affirmative), and so I quit trading for a little bit. I put myself on restriction, grounding. I think it was almost a month, I did very little trading, and if I did, we’re talking 10-25 shares. But, I was focusing on-
Clay: So, you didn’t quit trading then.
Jacob: Well, not completely.
Clay: Let me rephrase it. You quit trading the normal size that you were trading. Is that fair?
Jacob: Yeah, and frequency.
Clay: And frequency, okay.
Jacob: I would say probably 90% less. I would do maybe one or two trades at day at 10 or 25 shares. But yeah, I was still trading, technically.
Clay: Okay, I understand what you’re saying. You just stopped position size wise and then frequency wise. That makes sense. That went on, you said, for about a month.
Jacob: Yeah.
Clay: What happened after a month? Did you just pour back in the position size?
Jacob: No, I’m still doing the same 25, 10 share size. I’ve done a couple 50 in the last couple weeks, well, anyway, on some lower-price stocks.
Clay: Okay, for my sake, when did you have this … We’ll call it the Hail Mary Tesla trade that got intercepted? When was that trade?
Jacob: I don’t know exactly.
Clay: I’m guessing within the past few months.
Jacob: Yeah, yeah.
Clay: Okay, so you made that trade.
Jacob: No more than three months ago.
Clay: Okay, so you made that trade, and then, from there … Basically, if it was approximately three months ago, you’re telling me that up until this present moment right now as we speak, that for the past three months, you’ve been doing the smaller position size.
Jacob: Yeah.
Clay: Okay, and I’m guessing … I don’t know this, but I’m guessing you’ve been green overall?
Jacob: I have not been green overall, no.
Clay: Not been green. Okay, well, are you close to green?
Jacob: But I’m not … Yeah, yeah.
Clay: You’re close to green, at least?
Jacob: Yeah.
Clay: Before you had started doing this, it sounds like you were not close to green at all if you were losing, basically, just call it $1,500 a month. That’s not even close to being green, but now you are close to being green with the smaller share size.
Jacob: Yes, and actually, over the past … I swear I’m a headcase.
Clay: We’re all headcases. Trust me, we all have voices in our head. You’re not alone.
Jacob: Since I knew I was coming on this program, I think I’ve had six out of eight green days.
Clay: Because the pressure was getting to you, but in a good way, you think?
Jacob: Yeah, I knew I was going to be on here and I have calmed myself down. I’m in the process of fixing the problems because you don’t just realize you’re immature and then, the next day, you’re a mature person.
Clay: That’s a great point. Unfortunately, there’s no switch that you can just be like-
Jacob: Too bad.
Clay: Oh, hey, everything’s fine. No, that’d be fantastic.
Jacob: A big friendly button.
Clay: That’s interesting. My question to you: what have you done over the past eight days compared to the previous, let’s just call it two months, two-and-a-half months? What do you think you’ve done? Is it fair to say that those past three months have been better generally speaking already?
Jacob: A lot, yeah.
Clay: Okay, but it sounds like, correct me if I’m wrong, that even the past eight days have gotten even better. Is that also fair?
Jacob: Yes.
Clay: Okay, so, what do you think? Let’s just start from the broad sense. The broad sense where things have gotten better, maybe not as good as what they’ve been in the past eight days, but have gotten better. What do you think the main difference there is? Is it just the position size or is there other things going on also?
Jacob: I’m just picking better entries.
Clay: Now, how are you picking better entries? Are you being more patient? Is that what you mean when you say that?
Jacob: Much more patient, being way, way more patient. I’m being way … Well, I’m still tight with the stops, but a lot more lose with the stops than I had been. I was playing everything so close to the vest. I was just basically giving myself no chance.
Clay: Ah, okay.
Jacob: So, by not getting in my own way, I’ve been able to turn a little bit of that into some mild success.
Clay: By, you said, loosening the stops.
Jacob: Yeah, loosening the stops, being patient, giving these things time to play out, I don’t know, just picking up a little bit better … or, not giving into my bad habits, just slowly trying to change my habits to, when I realize something, to pay attention, to be … Here’s the thing. I’m not an in-the-moment-type person. I’m not a detail guy. I’m a big picture guy. I’m also kind of an airhead in some ways because I like to spend my time with something in the back of my head spinning, thinking about something. I spend a lot of time thinking about just physics and stuff like that like, “What’s going on in the particle physics world?” just things that don’t matter to anybody, but they’re important to me for some reason. I have to consciously come out of that state of mind in the moment with what’s going on here, and that’s not really easy for me to do psychologically because my mind wants to just wander constantly.
Clay: I’m totally thinking out loud here. Let’s call it the particle physics mindset. If you kept your mindset in the particle physics mindset, do you think that would help out the trading more, or is that a mindset that you’re very confident needs to be avoided?
Jacob: I can’t. That is a total … It’s a distracting thing. When that whole thing is going on and I’m indulging that part of my mind, everything else is on autopilot.
Clay: Okay, okay, which is not exactly what you want. Well, it sucks because, sometimes, though, you do want to be on autopilot. When you get in a position and you got to let it work for you, you got to give it some wiggle room. You don’t want to freak yourself out and then get out of the trade right before it goes in your favor. It’s a fine balance.
Jacob: It is.
Clay: I could say, “Well, at that point, go to the particle physics thing so you don’t worry about it,” but then that presents a problem of, yeah, but when is it time to get out of the particle physics? You don’t want to be in autopilot, then miss out on other things that you’re supposed to be doing.
Jacob: And it’s not a jump in, jump out type thing either.
Clay: Okay, okay. Well, that’s good that you’ve identified that and you know that just needs to totally be avoided so you can stay focused on things.
Jacob: Yeah, I’ll talk out loud to myself. When I realize I’m trying to focus, I’ll start basically going through this, “Okay, well, this is a bull context,” and I’ll start breaking it down and being like, “Okay, where’s the 50?” and I’ll actually be saying this stuff out loud to try to bring myself back to just me and what’s going on in front of me, and it helps to focus me.
Clay: Oh, no, I do it all the … well, not all the time, but I do it quite a bit even for people that watch my live trade videos. Sometimes, I’m literally saying outside, “Okay, what price do I have?” I’ve done it so many times on my live trade videos because they’re difficult when there’s a lot going on where I think I have a certain price that I want to buy, and then when I click, it’s some random price because I forgot to actually check the box and make sure that I’ve entered in the price that I want to enter in. I’m forgetting because I’m actually talking and stuff like that on the mic.
Clay: So, I do that same thing. Sometimes, I’m like, “Okay, double checking,” literally saying it out loud. I get it probably as a viewer sitting there on YouTube like, “Who is this guy talking to? What is he checking?” But, I’m doing the exact same thing. I’m talking to myself out loud to remind myself to check, make sure that the price is in, to make sure I have all the buttons set up the way that I want them so when I hit them, they actually execute in the way I think and want them to. So, I will second that. If you’re a listener out there and you need some sort of reminder, a sticky note, it could work for you. But, to me, the best reminder … and, it sounds like, for Jacob, it’s just like, no, literally talk to yourself. Say it out loud. It’s helping us out
Jacob: It’s helped me a lot.
Clay: Yeah, I 100% can relate to that. So, I’m assuming that you’re able to loosen up those stops now and relax a little bit more. I’m guessing that, because this position size is smaller, you can look and be like, “Yeah, I can give it a little bit more room. I can give it a little bit more wiggle,” because it’s like, “Hey, you know what, it’s not like this loss is going to be some huge thing if it goes against me.” Do you think that’s playing a role into things, too?
Jacob: Yeah, absolutely. I’m looking. I’m playing this like, “Okay, I’m literally only going to lose $5-6 on this trade if it goes against me, but I could make $25 on it if it does what I think it’s going to do.” I’m totally comfortable doing that. I think that’s where the not being … getting out of my own head, not feeling like I’m going to live and die with every trade and relax.
Clay: What happens if I were to say, if you’re wrong, you could lose $600, but, if you’re right, you could make $2,500? Do you think you’d be able to sit?
Jacob: No.
Clay: Do you think you’d be able to chill out on that trade.
Jacob: Not yet.
Clay: No, exactly. Thank you for being honest. So, “What are you talking about? It’s $600, but you could make $2,500.” Yes, I realize that, on a spreadsheet, that all makes sense, but there’s spreadsheet math, and then you have real world math. The thing with the real world math is there’s these things called emotions that get attached to it.
Jacob: Have you ever heard of The Hitchhiker’s Guide to the Galaxy?
Clay: I’ve heard of it, but I’ve not read it. I remember it being super popular, though.
Jacob: Yeah, everybody should read that. There’s this one, it’s called The Restaurant at the End of the Universe and, in that restaurant, mathematics behaves in a way that it doesn’t behave anywhere else in the universe. It has to do with how much the food costs, how much it costs to prepare, how much they think it’s worth and how much you’re willing to pay create this weird algorithm to manipulate it so the universe functions separately there. It’s kind of like that.
Clay: No, no, that’s exactly like it. You have universe math, and then this restaurant known as the market, any financial market. You can sit there and be like, “Of course I’ll be okay with $600 loss because, if the upside reward is $2,500, that’s good risk versus reward.” Yeah, but if you’re not truly mentally okay with $600, you’re going to freak yourself out so bad even if it’s a good trade plan. So, it all boils down to, a key is you have to figure out in your mind, what loss are you truly okay with? What loss can you look at and be like, “No, I’m genuinely at peace with that number.”
Clay: As of now, for you, you seem to be totally at peace with $6. I’m assuming part of your game plan now is, eventually, “Okay, well, what happens if I lose $15? What happens if I lose $20?” You’re going to slowly scale that number up, and, as you do that, well then your position size will also grow. But, there is no chance of having hope for success at all if you are not genuinely okay with the amount that you could potentially lose. And, if you don’t even know the number that you could potentially lose, then you don’t even have a trade plan in the first place, so you should definitely stop trading in that regard, too.
Jacob: Completely, and that’s where I was at. I had no trade plan. I thought I did, but I didn’t. That’s the first thing I look at now is I know going in that, if it goes bad, I’m going to lose roughly X amount of dollars. That’s like I don’t know the first thing. I analyze the chart and everything.
Clay: It’s at the top of the list. Yeah, I know what you-
Jacob: But when I’m going to make this trade, I’m getting ready to push these numbers in, the one thing I need to know first is: what is this going to cost me if it goes wrong?
Clay: Yep, absolutely. That makes very good sense on why the past three months have all of a sudden, maybe not gotten back to totally green, but close to being green, which is a huge jump compared to how it was. Now, trying to narrow things down, what do you think you’ve done differently compared to all that, compared to the past eight days in anticipation of this discussion right now?
Jacob: I don’t know if I could really put-
Clay: Is there a chance that you haven’t done anything? Maybe you’re just on a bit of a hot streak here? Do you think that there is something different that, all of a sudden, you’ve done?
Jacob: I think there’s something, but I think it’s really subtle. I don’t know. I don’t know if I could put my finger on it. I just have this self-sabotage part of my brain, and that’s been something I’ve dealt with forever since I was a young kid whether coming from depression or a difficult childhood or whatever the case may be. But, I’ve also had that; right when you’re about to be successful, you should yourself in the foot because maybe I’m lazy. I don’t know what it is. I think I minimized my losses. What am I trying to say? [crosstalk 00:47:09]
Clay: I know what you’re saying. I feel like that’s almost a good thing in trading though, because, if you’re scared of, “Oh, crap, I’m going to shoot myself in the foot. Oh, crap, I could shoot myself in the foot.” Yeah, but that’s actually true in the markets. The minute that you don’t follow a trade plan or honor risk, you are going to shoot yourself in the foot, and it can all go away very, very badly. I would almost say you would want to leverage that. Take that … I don’t know if paranoia is the right word, but take that fear of, “Oh, crap, I’m going to shoot myself in the foot.” Exactly, you might, so you better keep honoring that risk, which is also maybe why, at first, those stop losses were maybe a little bit too tight. But, it sounds like you’ve now overcome that by understanding the position size and loosening up those stops. I don’t know. I’m just spitballing ideas, here. It seems like that-
Jacob: I think I’ve just been smarter about taking my profits out. For a long time, a part of my problem was I basically was doing everything wrong. One of the things I was doing was I would turn winning trades into losing trades just one after another.
Clay: How would you do that, because a listener is like, “How is that even possible?” Maybe you can-
Jacob: I think that’s greed. I think it’s just not enough. It’s like, “That can give me 10 more cents or 30 more cents.”
Clay: Okay, so you would have a winning trade, and instead of-
Jacob: I would ignore what the chart’s telling me because I wanted more money.
Clay: You just wanted more money, and then, all of a sudden, everything would reverse around on you, and, what had been a trade where, had you listened to the chart, it would have put money in your pocket. Because you didn’t listen to the chart, now, all of a sudden, it’s taking money out of your pocket.
Jacob: Yeah.
Clay: Okay. I should have asked, but what are you actually trading? Are you doing stocks or options or what?
Jacob: Just stocks.
Clay: Okay, okay. Do you ever scale out?
Jacob: Yeah, I try to follow that process the way you’ve set it up.
Clay: Is that a difference that you’re doing? I can see someone, “Well, I think it’s going to go a little bit more and I want a little bit more.” Okay, I’m not necessarily opposed to that, but at least maybe pull some off the table. It sounds like you’ve started to do that then, now, too?
Jacob: I’ve started to be consistently doing the same thing over and over again, and that’s part of it, is scaling out, yeah.
Clay: Okay. What are these other things that you’ve been consistently doing over and over again? Which is very good. You don’t want to have randomness, so that’s good that you’ve now started to find a little routine here and groove.
Jacob: I consistently try to honestly evaluate what my head’s like at that moment, like, “Am I even emotionally trading at this moment?” My wife was diagnosed with cancer actually at the very beginning of last year, so last year was a tough year for us just family-wise and emotion-wise.
Clay: Yeah, goodness, and the world changes.
Jacob: Yeah, then all of that. Then, my wife’s dad died at the end of September. It’s just been a nightmare for her. My whole life sucked for years because of my back problems, and that affects the family and all this stuff. And then, this last year has been all just attack on her, so I’ve been trying to support her, and we’re going through all this stuff at the same time. It’s a lot of emotional and psychological evaluation and just making sure that I’m in the …
Clay: Go ahead.
Jacob: [inaudible 00:50:48] that day.
Clay: Yeah, no, that’s super self-aware and wise because, if you’ve traded before, then you well know how much of a psychological game it is. But, because of that, you do. You need to just there like, “Okay, as bizarre as it feels, how am I feeling today?” That’s actually a super good question that all traders should be asking themselves before they ever really step into the market for that day. Because, if something is off, you just got to be honest with yourself and be like, “I’m just …” You don’t have to necessarily identify it, but even the feeling of being off, you got to be very careful.
Clay: So, you’re absolutely right, and that’s where everybody’s … Well, what’s the feel? I don’t know. Everybody’s life is different. Everybody goes through different circumstances, so I don’t know what it’s going to take for your mental mind to feel some way. But, if it is feeling in that particular way, it can get sketchy in a hurry, can’t it?
Jacob: Yeah, really.
Clay: Really, really quickly.
Jacob: Really fast.
Clay: Before I forget, so, you’ve had a couple losing days because, had you sat here and said, “Yeah, I’m on this eight-day winning streak,” I would have to question and be like, “Well, is that just because you refuse to actually ever take a loss and you just keep getting lucky?” But, you’ve had some losing days, so that tells me that you must be honoring stop losses and stuff. These two losing days haven’t wiped everything away, have that?
Jacob: No, they’ve been fairly small losing days.
Clay: Over the eight days, you’re still green though, right?
Jacob: Yeah, I’m green over the eight days.
Clay: The losses have just been situations that don’t work out?
Jacob: Yeah, just didn’t go my way.
Clay: Were any of these days where you had three winners and then that one loss took you down to red?
Jacob: Exactly, not that, which had been what I was doing. I would be up. Again, I would turn winning trades into losing trades. I would take winning days and turn them into losing days, a winning week and then just tank Friday. I don’t know, but so, on my losing day, I can’t remember which one it was. I think it was Wednesday or Thursday or something last week, but I was 20-some dollars down. I had two losing trades in a row, so I was, “I’m done. That’s it. I’m done.”
Clay: Now, is that a rule, two losing trades and you’re done, or is that just more of a mental … You could just tell that you needed to be done?
Jacob: At that moment, it was, “I’m either going to fix this or make it worse, and I don’t really feel like I’m in the mood to make it better. I just really feel like I need to quit.” So, right then, I was like, “I’ll just come back tomorrow.” Because, the day before, I had $35 or $40 or something, so why would I … already a couple trades down, not doing that great, kind of not feeling it. Why would I turn yesterday into a losing day? Yesterday was a winning day. Why ruin that?
Clay: Exactly, especially when you know that you took a couple of good … Well, I’m assuming they were good setups that just didn’t work out, and that you know that, over the long haul, if you keep taking truly good setups and situations where that’s most likely to happen … Nothing’s guaranteed to happen. In that situation, what’s most likely to happen is X, Y and Z, yeah, if you just keep taking those setups when you’re in the right mindset, which is very clearly what you’re on guard against, which is super important, yeah, that’s a huge step in the right direction to be able to take those losing trades, losing days.
Clay: Like you said, you can always look at it and say, “Well, I can either fix it now or make it worse.” For me personally, way too many times, I say, “I’m going to fix it.” But, what I’m really saying is, “Screw this. It’s time to revenge trade. I’m going to get that back.” My solution of fixing is revenge trading, and, again, from personal experience, don’t listen to that voice. More times than not … I love the logic you use, “Okay, today’s red. That’s fine, but do I really want to turn yesterday red also?”
Jacob: Yeah, that’s stupid.
Clay: “That’s really going to probably irritate me.” And then, all of a sudden, you have another day red. And then, all of a sudden, it’s the past three weeks that are red all because you wanted to just-
Jacob: And then you end up laying everything on the line for one Tesla trade, and that’s going to resolve everything one way or the other.
Clay: Yeah, and that’s where you just don’t want to go to. You’re absolutely right. Do you remember how the next day went? Did you make money the next day, or was that another-
Jacob: Oh, I don’t think I got back on my … no, I didn’t trade after that. It really shook me.
Clay: No, I meant that-
Jacob: I didn’t trade for at least a week after that.
Clay: No, I meant the $20 losing day that was part of this eight-day period.
Jacob: No, I was green the next day.
Clay: You were green the next day. Do you remember if it was more than $20?
Jacob: Yeah, I think it was more. One of them was $50, and I want to say I think that one was the $52 day, the next day after that.
Clay: Doesn’t that feel good though when you wake up the next morning … If it were me, we’re all different, but I wake up. I’m like, “Oh, $20 down. I can recoup that. That’s not a massive hole.” You feel good the next morning that you decided to just stop trading the previous day. Do you ever have that feeling. That’s something I just got to remind myself. “Clay, you’re going to feel better about it tomorrow morning. You’re going to be glad that you just stopped right now when you can start afresh.” It’s just kind of funny how my mind works is I just got to remind myself that, in the heat of the moment, by tomorrow morning, don’t sit there and be like, “I wish you would have just stopped because, now, with my clarity of mind, why did you got to make it so much worse, Previous Day Clay?”
Jacob: Yeah, exactly. I do that, too. I don’t learn.
Clay: Sometimes, like you said, be done with it. Realize tomorrow is a new day, and, in your situation, you came back and not only recuperated those losses, but put more green in your pocket, which has kept and is keeping, it looks like, a nice little groove of things going on here. Yeah, that’s really … once again it’s showing up, is lowering position size.
Jacob: Yeah, that changes everything.
Clay: It’s amazing how much … Yeah, it changes so much, doesn’t it?
Jacob: It really did because it just took all the pressure off. And then also, it’s like, if you have a certain position size and X amount of dollars, then you have a finite number of trades before you just blew everything up.
Clay: Exactly.
Jacob: So, how much learning and progress are you going to make in that time? But, if you are doing 10 shares, 25 shares, I can trade for a couple months and not blow everything up. That’s a lot of experience.
Clay: That’s a lot of experience and a lot of good habit building, too, which, just listening to you talk right now and listening to your rationale on things, it’s like, “Yeah, that’s good quality experience that you’re getting when you can just walk away from a day being red because let’s just keep it green.” Then, the next day, you come back and you then have … Now, if you came back the next day and you made like, $500, you’d be like, “Okay, what a second. Did you just all of a sudden leverage up your position because you wanted to get back the previous day’s losses?” That’s a much different situation, but if you came back the next day and were up $30, $40, $50 or whatever, it’s like, “Okay.” That’s just keeping on and you had a bit better of a day there, so that’s smart.
Jacob: Yeah, it all comes back to being in the moment, to kicking everything else out and bringing my focus to just what I’ve got in front of me.
Clay: Exactly. Be focused. Get out of the particle physics mindset and realize that you’re in the restaurant, right? You’re officially entering the restaurant and math works a little bit different in that regard because the math happens to be money that you’ve worked hard for and that you don’t want to lose, which creates all sorts of different voices. Awesome, well, did you want to throw in anything else before I move into the fun questions? But, coming up on an hour.
Jacob: I don’t think so.
Clay: I don’t want to … Okay. Hopefully, we’ll have you back. I’d love to have you back if you come back just so we can hear how this continues. It sounds like it worked out well for you. Maybe we should have you every other week. We can keep these win streaks, these six out of eight days.
Jacob: I just did not want to come on here. I don’t know what it was. After about the third winning day, I was like, “That’s why I’m winning, because I don’t want to go on there and tell him, ‘Yeah, I’m still losing every day.'” I don’t know. I wanted to have something-
Clay: I guess maybe keep it in the back of your mind like, “I never know when Clay’s going to be like, ‘Jacob, it’s time to come back.'” So, just have that, that I could spring upon you like a leopard up in a tree or like a cheetah.
Jacob: If you emailed me, it’s like, “Okay, I need your report for last month,” I’d have to send it to you out of being a member of the community and accountability. So, maybe I’ll keep that in my head that, if Clay ever wants my receipts, I can show him.
Clay: Just keep that in mind. I could ask you, just spring out of a dark corner at any point and say, “Hey, you’re up again for the podcast,” and maybe that’ll help you out. What you’ve said to me makes sense and why you’re starting to see that turnaround, what you’ve done, again, nothing fancy.
Jacob: No, it’s not fancy.
Clay: Just lower that position size and it’s amazing just how much more that can open up. I kind of feel like I might know what you’ll answer this, but we’re going to do the time machine question anyways because I could be totally wrong. But, if you had the time machine and you could go back to the start of all this and give yourself one bit of advice, what would that advice be?
Jacob: The first thing I would do … I have given this advice to people. It was like, “You have to be a member of a community. You can’t just sit down and begin trading and do it all on your own. If you want to be a member of a community, I know where you can go. If you’re not going to go in and commit to education …” and, that’s what it is. It’s education just like if you would go to college, or like I went to and learned how to do the NDT stuff. I paid $25,000 to learn how to use that. So, you’re going to make an investment. Educate yourself before you start trading. Learn what you’re doing before you start trading.
Clay: Yeah, I was going to slightly disagree with join a community because I could see somebody being like, “Well, I am part of a community. It’s called WallStreetBets on Reddit. It’s like, okay, well, correct, you are part of a community, but I’m not quite sure if that’s the exact type of community that you want to be with.
Jacob: That’s not what I mean, no.
Clay: But, you did preface it when you add in, “Yeah, a community combined with some structured education.” That’s a much different scenario than just, “Diamond hands, YOLO,” because that’s what my community is part of. That’s an answer we’ve heard before and I would say a smart answer because there is a lot of value in that. Let’s get to know you a little bit more on a personal level. You’re in Oklahoma out there. What is your favorite movie?
Jacob: I love movies. Me and my daughter love movies.
Clay: It’s got to be some sort of science fiction if you’re a particle physics guy. What is it, Star Trek?
Jacob: No, but it’s not going to surprise you.
Clay: Star Wars?
Jacob: The Matrix.
Clay: Oh, okay, yeah, yeah, all right, that’s not surprising at all.
Jacob: I walked out of that just blown away. My daughter, she’s like a movie critic. You talk about smart, that girl’s smart. I got her to watch The Matrix with me a little over a month ago probably and she loved it, so I was super happy.
Clay: That’s awesome. That’s just a classic. The other Matrices, okay, but the first one, how can you not like the first one?
Jacob: Mind-blowing.
Clay: Especially at that time when it first came out. Were you around when it first came out in theaters?
Jacob: Yeah, 1999, and I didn’t do a lot of movie watching stuff back then. But, a guy that I worked with, he found out I had never seen it and was like, “I’m taking you to watch this movie.” So, he drug me out, paid for my ticket and took me to go see The Matrix.
Clay: Because that was groundbreaking special effects back then, too, seeing all that. That stuff was-
Jacob: It changed movie making.
Clay: it did. We sound like a bunch of old guys right now. These young kids are like, “Get off my lawn.”
Jacob: I’m pretty old, yeah.
Clay: I am officially that person that’s reminiscing about the good ol’ days and everybody is like, “What are you talking about? All movies have awesome special effects.” It’s kind of like … anyways, what about food out in Oklahoma? What’s your favorite food?
Jacob: I love sushi.
Clay: Sushi?!
Jacob: Yeah.
Clay: Fresh from the ocean in Oklahoma?
Jacob: Yeah, there’s a great place that opened up in our little town not too long ago, and so I take my daughter once a week. We go get sushi and it’s good.
Clay: I love sushi, too, but sushi … Do you understand my perspective though that sushi in Oklahoma seems a little ironic?
Jacob: Yeah, yeah they don’t have tuna in the lakes out here.
Clay: Is it good? It doesn’t have a distinct smell to it or anything?
Jacob: No, it’s good. It’s fresh. I don’t know how they do it if they freeze it. It seems fresh, anyway. Maybe they have a trick.
Clay: Yeah, tuna, maybe it’s-
Jacob: It’s good.
Clay: Hey, I do like sushi though, quite a bit. And then, finally, what do you like to do for, I guess, hobbies, besides thinking about quantum physics and stuff like that?
Jacob: I do 3D printing.
Clay: Oh, cool.
Jacob: I got a little 3D printer, a couple of them actually. I make a lot of Marvel props and stuff just for fun.
Clay: Did you say marble?
Jacob: Marvel.
Clay: Oh, Marvel like the comics.
Jacob: Yeah, like Stormbreaker and Mjolnir. I made Captain America’s shield.
Clay: Are these actual size things?
Jacob: Yeah, life-size movie-quality proppers close as I can get them.
Clay: Do you sell them?
Jacob: I should. I’m not a real go-getter, man.
Clay: I would love to have a Thor hammer in my office.
Jacob: Yeah, I could do that, man, if you’re not in a hurry to get it.
Clay: Yeah, give me a price or whatever, assuming it’s not some sort of astronomical-
Jacob: No, it wouldn’t be.
Clay: We’ll talk after this. That actually sounds super, super cool.
Jacob: Yeah.
Clay: Anyways, all right, well, and 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?
Jacob: Education, patience and circumspection.
Clay: Okay, what is that word? Is that like self-reflection?
Jacob: Circumspection, it’s kind of like making good decisions and all that. My definition of it is you got to go to the root of the word. To be circumspect is to look in a circle or observe what’s around you.
Clay: Okay, that makes sense.
Jacob: Only then can you make the right judgements. You have to know what’s going on.
Clay: And you have to have full context, hence the circle. You look all the way around.
Jacob: Yes, all the way.
Clay: That makes sense. I like it.
Jacob: My coach used to say, “Keep your head on a swivel,” and I always liked that.
Clay: There you go. I’ve heard that one, too.
Jacob: It’s circumspection.
Clay: Yeah, yeah, that’s good stuff. All right, man, thank you for doing this. An extra thank you knowing you were nervous to be here.
Jacob: Yeah, it’s outside of my comfort zone, for sure.
Clay: Nothing but respect to know that you volunteered for something that is out of your comfort zone when you are not being paid or anything to be here. Man, that’s awesome. I think a lot of people could learn from that.
Jacob: I just feel kind of grateful a little bit that you have went ahead and made this the way that you’ve made it. It wouldn’t be what it is if your motivation wasn’t for people to be successful, to be a good coach like you say. That comes through. So, if it weren’t that, I wouldn’t have gotten as much out of it as I’m getting and hopefully will keep getting out of it.
Clay: Yeah, no, well, you’re just … Like I said, I don’t think I’d rip you to shreds, but I will say with full certainty, just the conversation, you can tell that your reasons for doing things just makes sense like, “Okay, yeah, that is actually a good lesson learned,” not some sort of lesson like, “Ah, man, I bought a penny stock and it didn’t work out.” So, how’d you change? “Oh, yeah, I learned a lot from that. Now I’m off trading some sort of random altcoin that was just invented two days ago. That’s what I learned. I don’t need penny stocks. I need random altcoins.” It’s like, “Okay, I realize you think you learned a lesson, but I’m not quite sure you learned the right lesson.”
Jacob: I can’t trade stocks, so now I’m going to trade options.
Clay: Yeah, but I would say that, for you, there’s a lot that people can take away from it. We’ll have to have you back at some point. Like I said, when oh when that will be, we’ll have to just leave that so that you have that little voice and you can just keep staying extra disciplined in your training. But Jacob, in all seriousness, thank you very much for being here and volunteering.
Jacob: Absolutely, Clay, thank you.
Clay: Now, for you listeners out there, before we go, a couple final things: first off, if you are listening on iTunes or any of the other podcast players, be sure to subscribe. Especially on iTunes or any of the players, if you could leave us a rating or, better yet, a written review, those things really do go a long way. It’ll just help to communicate that it is still worth the effort and time to put these together. As long as I know that people are enjoying and you’re getting value from them, then we’ll keep the show going.
Clay: Again, all it takes is to communicate that. Just leave a review on iTunes, hopefully a five-star review. Better yet, even if it’s just a small, simple written review, things like that go a long way. And then also, if you’re listening at claytrader.com on the show notes page, there is a little area to contact us. In the bottom right-hand corner, there’s a bunch of frequently asked questions, but then there’s also a choice to reach out directly to us as we would love to hear from you. Nothing better than hearing from somebody that starts off the conversation with, “Hey, I listen to the podcast,” so always like to hear from everybody out there. But, we thank you again to you as listeners. Thanks, Jacob, and we will see you all 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 ClayTrader community, including the trading team, premium training and more, visit claytrader.com.