In this extremely valuable discussion, hear from Dr. Brett Steenbarger, Mike Bellafiore, Anthony Cheung, Jason Graystone, and Darren Oglesbee. We discuss trading psychology, fundamentals impacting the current market environment and ways traders are profiting.
View Video Transcriptwhat we’re going to discuss in this
roundtable discussion it’s going to be
extremely valuable for the trading
community this is how we try to
keep the flow of these events going just
delivering value to the trading
community and that this is going to be
no different
i want you guys to imagine that you’ve
kind of stumbled into
the back of a restaurant into the back
room and there’s
some guys some kind of traders that have
been around the block a little bit all
discussing talking shop talking trading
and you get to listen and we’re going to
go through some really important topics
[Music]
we’ve got dr brett steenberger who’s in
my opinion one of the the leading
world leading trading psychologists uh
he’s an author of a couple of books i’m
going to let you
introduce yourself in just a moment um
brett but
insanely valuable guy to having this
discussion
just a talent beyond belief we’ve got
anthony chung who’s
the best fundamental analyst that i know
and you know he’s a
real great guy he’s been to our we’ve
been in one of our events before
um you guys that came to the vault in
london i did with mike
and and the other guys anthony was there
providing lots of value
and i’ll let him introduce himself
briefly in just a sec
and of course we’ve got mike bellafiori
who’s just too good to even
like show up he’s just so good he’s just
not even gonna even
like bring his camera it’s not even
worth it his name’s there that’s enough
he was here in spirit um let’s see if i
can make him a presenter that might
that might work better for him that’d be
cool so um
dr brett steenberger do you just want to
give us a quick introduction about what
you do and how you spend most of your
days in the trading world
how do i spend most of my days in the
trading world digging out of holes
usually
um i’m a psychologist
i teach at a medical school in syracuse
new york and my main work is
as a performance coach for traders and
portfolio managers at hedge funds
proprietary trading firms asset
management firms
and so forth but i’m really helping
people with their
performance i trade stock indexes myself
and have done so oh wow i’m gonna date
myself since the late 1970s
wow so yes i’ve been in the interested
markets falling markets for quite a
while
and uh love uh trading and love working
with traders
amazing excellent and it’s great to have
you here so uh anthony tell us a little
bit about what you how you spend your
time
yeah well i was supposed to have a day
off yesterday but i think when you’re
involved in markets it’s always quite
hard to
to distance yourself especially nowadays
i think that buying an apple watch was
the worst idea in the world
now i shake down the street half the
time but um
the yeah i mean i my background is
um as a kind of macro
strategist analyst however you want to
give it the title
but uh my career started back in 2006
i worked on kind of like a global macro
cross asset
desk where we were covering uh basically
scheduled things that were going on in
the market so things like right now
if if faiz or moderna come out with some
news i’m supposed to be the guy that can
tell you everything about
how much it costs when it’s going to be
distributed what the infrastructure’s
like of that firm
all these types of things the ability
then to be able to
i guess interpret news flow is kind of
my
area of expertise and and try to help
traders understand what otherwise is a
very noisy environment
typically for people who don’t have too
much in the way of a structured approach
to these sorts of things
it can be very intimidating i guess when
you kind of
maybe if you learn self-trading and you
branch off of technicals and start
entering the world of
macro fundamentals it’s you know where
do you start things like that so i kind
of spend
nearly all of my time helping traders in
that area
i used to just do it for clients and now
since i joined amplify
trading which is where i work now the
last few years i’m in more to helping
assist and teaching on that side of
things
i also lecture a number of universities
across the uk
in this area try and help young people i
meet are incredibly intelligent way more
intelligent than i could ever hope to be
that i meet at university
but the the problem they have is they
don’t have any actual
practical understanding of how this
stuff that they’re learning really
applies
a real world sense so i’m that they
bring me in basically as the
um market practitioner to try and give
them a little flavor for that
um and especially like real world stuff
that they get challenged
on when they’re looking to pursue
careers that otherwise they’re they
really are
not very good at because they’re too
busy
deep into the theory stuff so yeah
that’s my background
amazing so look thanks for both coming
on to the discussion
i think mike’s just having a little bit
of a trouble with his mic i’m going to
the other guy in the room is darren
oglesby and he’s our
he’s a he’s he’s one of our guys he’s uh
he’s going to be moderating this
discussion because i’ve
spoke way too much so i’m going to hand
over to darren who’s going to kind of
kick off some discussion here
and if you guys any questions you want
to join in um
feel free to i’m going to try and get
mike in as well so
let’s go i’ll hand it over to you darren
sounds good yeah so guys i just wanted
to
kind of provide a framework for the
discussion because what we had is
an internal discussion within our team a
couple weeks ago
and we were kind of taking this time to
reflect and look back
at what 2020 has been and all the events
that have happened
and obviously nobody was prepared for
what was going to happen
i don’t think anybody at this time last
year was
structuring their positions and basing
their trading plan on the idea that
we’re gonna have this uh
unknown virus you know come around and
cause mass casualties and global
economic
uh shutdown and so nobody was really
prepared for that but
even so what we found is that there were
kind of two narratives
or two stories that have come about this
year and one is a story of
uh destruction and despair of financial
loss
and the other is a story of opportunity
of record growth um and
what we’ve tried to do is kind of look
at those the people that are in those
two categories and identify
you know what was it about those people
that you know for 2020 it’s been a
record year
they’ve seen record growth and they’ve
been able to capitalize on the
opportunity what is about those people
that allowed them to be adaptable under
pressure
that allowed them to kind of make the
necessary changes required to
be successful in this type of
environment and so what we wanted to do
is bring you guys on because you each
offer
a very unique and valuable perspective
on
those types of issues and so
brett i might start with you with this
question um
i think you probably agree that under
quote-unquote
normal circumstances uh trading
psychology
managing your emotions is a difficult
thing to do i know akil talked in his
session earlier this morning about how
it’s probably
the most difficult challenge that
traders are going to have to overcome
but then you add on to that this global
pandemic uh the pressure of economic
shutdown
and all these different things that have
kind of come about in in 2020
what do you see as kind of the primary
challenge
that people have had to overcome and do
you see that that’s really any different
from
the normal challenges that a trader
might encounter
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so the number one challenge for 2020
2020
is not a typical year obviously and
you know you mentioned about the
pandemic and
people who have succeeded in the
environment of 2020 well the real
problem is that
2020 has not been an environment 2020
has been multiple environments
and it’s the people who have been able
to switch gears who have been able
to recognize shifts in those
environments that have succeeded
and that that is partially an issue of
trading psychology but not entirely
we have to recognize different types of
markets and market conditions
so if we just start with equities you
know early in 2020 we were grinding up
in a low vix market and we
uh hit a peak in uh january and then all
of a sudden we started to make some new
lows
uh in um february and boom
you know the wheels came off the bus and
volatility exploded
but also liquidity really dried up
in a number of markets and so
that completely changed the trading
environment for a number of people
and then off the march lows we got a
bounce and what was everyone saying
double dip we’re waiting for it to test
the lows etc etc
well it never did and so we went into
this
rising market where certain sectors
in the equity market were strong like
tech
uh and some of the stocks benefiting
from a uh companies benefiting from a
pandemic
and then other sectors were relatively
weak
like some of the value stocks the
small caps lagged but then more recently
as we have had the prospect
of a vaccine on the horizon the rally
has broadened out
significantly we see small caps
performing very well those value names
have
have done quite well and so the whole
rally is broadened creating a totally
different environment so we went from a
strong rotational environment
to what is now actually a momentum and
trending market
and recognizing those shifts which means
psychologically having an open mind
not getting caught up in one scenario
ends up being super important
right absolutely and that’s kind of what
we do i know back in
um it was early april i think we held an
event
and what we noticed at that time is like
that was like kind of the height
of i guess it was really it ended up
being the lows but it was the height of
the fear and the uncertainty
and what we were telling people was hey
be calm you know we’ve seen
these we haven’t seen this specific you
know scenario on play but the the type
of
fear and panic and you know
emotion that was tied up we’ve seen that
before so the idea was hey stay calm
uh you know be focused because there is
a lot of opportunity
that awaits you um unfortunately for a
lot of people i think
that message was too little too late
because they didn’t have like you said
the skill set to be able to see the
writing on the wall to see the signals
that the market was providing and then
to kind of be able to put themselves in
a position to to take advantage of that
um i kind of shifted over to anthony i
know um
you deal a lot on the fundamental side
and looking at those types of things
um i would expect that even the best
fundamental
analyst was caught off guard by the
stuff that we saw this year i mean we
got
oil went negative like the brokers had
to change the way they operate right
and so you know what what did you see
you know in the early days of the
pandemic and then you know kind of
from a fundamental analyst point of view
how did you have to shift and adapt to
to be able to operate in this new realm
yeah i think one of the things that
actually was quite
reminiscent of the financial crisis when
that was unfolding
that i remember very specifically for
another job that i was doing
so my job was to you know real-time
surveillance of markets with a
microphone broadcasting to all traders
to let them know what’s going on
i remember those periods during that
where
there was no news there was no catalyst
it was just
almost behavioral it got to a tipping
point where the selling took over the
mentality set in
and the market was just going down and i
remember at the time my boss
used to say to me get on the mic and i’d
be like
and say what i’m looking at the
terminals and i can’t see anything
and he’d say say something and i’d say
say what he said just speak
and then i used to come on and actually
during those periods of extreme
uncertainty and fear
uh it’s almost like my job uh
was to come on a microphone on the
tannoy system into all these traders
and just be a voice of calmness
to instill a more rational approach to
what they are doing because
you know anyone who traded them and
there were bouts of this to a certain
degree when the march sell-off was
happening
you see these big waves of selling come
in when you’re looking at it
in kind of real time in in the intraday
environment
and so a lot of it is yeah
definitely obviously experience is a
fine thing having seen that before
live seeing it again you kind of feel a
little bit more naturally composed
to interpret that the other thing that i
find that’s more relevant
particularly in the recovery is i think
bret hit a really good point which is
like not being too
married to one idea and that the
situation the environment
changes um and you know that’s a
difficult thing
because when you’re trading obviously
you’re you’re making a decision
and you’re getting a tangible result on
the back of your decision-making process
so you’re either going to be right or
wrong
ultimately an adjustment process
obviously takes a lot of time
but for me then interpreting news is
what’s been quite difficult
here for people a lot of people i think
is there’s a big disconnect obviously
between
wall street and main street and that’s
difficult when you’re subjected to such
media
when all you hear about is the like in
the america at the moment
you know as far as the uk we’re
concerned you guys are being ravaged
nationally and every state’s going into
large degree of restrictions being
enforced and yet
we hit 30k in the dow kind of yesterday
so i think a lot of people find it hard
to kind of pick
what is the most influencing factor at
that moment in time
and i think yesterday was a really good
case in point where you have a
simultaneous string of catalysts whether
it’s janet yelling being the treasury
secretary or biden’s getting the nod now
for the presidency
whatever it might be then you get
technical breaches of key long-term
levels and you
there is no other thing you need to do
than just follow the trend and
i think sometimes people can overthink
it to a certain degree
um so yeah there’s definitely
a couple of comparatives i’d say to what
i’d seen
working on the desk from from 2008 2009.
yeah if i could just jump in here
uh you know you’re making great points
anthony in one sense what happened with
covet is
completely different from the 2008
situation
because there we had a fundamental
situation
with housing with banks and
um you could see the banking sector you
can see the housing sector
unravel even before the big market
decline
so there’s a real fundamental basis here
this was like war breaking out the
the uh covid hitting was
not created by central bank policy or
anything of the sort
what people underestimated on a
fundamental basis i think anthony and
and i include myself here
is underestimating was the power of the
central bank reaction function
and the power of the fiscal stimulus
to turn the situation around uh i mean
they
really came out with a couple of
bazookas you know when we
hit that those lows in the march april
period and
looking back on it that was an important
turning point
of a fundamental nature those of us just
looking at charts
you don’t really miss that
yeah i mean we had the uk governments
come out today with the spending review
and we get to see the government level
of what they’re predicting for their
their bond sales uh issuance for the
forthcoming period
and it’s it’s more than double of the
financial crisis
so you’re absolutely right in context
this is multi-trillion dollars
comparative to singular trillion and the
response has been epic
in terms of uh this time around
certainly
that’s for sure totally agree now what
the long-term implications of that will
be
uh you know hard to know yeah and a lot
of the portfolio managers i work with
they’re monitoring inflation gauges
they’re looking
at how steep the yield curve might be
they’re looking at inflation break evens
five year five year forward
you have to try to get a sense of when
we’re pricing in
uh increasing inflation so far
not so much
yeah i see we got i think mike is on
mike
is your audio working for you now i’m
here oh it’s great to have you thanks so
much for being here
you bet thanks darren i just thanks
jason just to kind of fill you in um i
was talking to the guys um
you know we as traders we usually take
this time towards the end of the year to
kind of review the things that have
happened the decisions that we’ve made
kind of
try to prepare for what’s coming in the
year ahead um
and what we really saw to this year was
kind of two different story lines where
we had people who were just victims of
circumstance and then people that were
victorious over the circumstance
and so we’re kind of talking about the
the the qualities and the things that
separate the people who
managed to make this a record year a a
year of taking advantage of opportunity
versus those that were just kind of
steamrolled by it
and what i’d be interested to hear from
you since you have you know kind of the
the wall street prop firm
uh perspective on this is what kind of
challenges did you guys see
going into that march april time frame
and what were the discussions that you
were having with your traders in terms
of
you know this being more an opportunity
than
a time to be you know fearful and panic
yeah so we certainly weren’t fearful or
panicked we were
cognizant of the uh once in a generation
opportunity
i’ve been trading since 1997
and this is the best trading market
that i’ve ever seen this is better than
uh 2008 this is better than the late 90s
and probably by significant multiples
so we recognize that and
one of the things that uh is perhaps
challenging
for prop traders i’ll just share a story
from yesterday so
and look these are challenging times and
and so
i i say them with with sensitivity
understanding that
not everybody’s had as much opportunity
as we have uh
this year this has been a tremendous
year as a firm we’ve done
better than we probably ever thought we
would do traders did better than i’m
sure they ever thought they would do
uh these are life-changing years um
in terms of profitability for these guys
it’s both rewarding to see that
but we are cognizant of what’s really
going on sure um
but our job is is to do as well as we
can
as traders and yesterday um
one of our traders hit me up in a g chat
and you know said oh i
to the effect of oh i i blew it this
morning
and i have this leaderboard where i
check everybody’s
p l i hadn’t actually noticed this this
trader
had been doing particularly poorly so i
rechecked the leaderboard
started at the bottom and figured he’d
be down for this trade of hundreds of
thousands of dollars
and i look at the bottom of the
leaderboard i don’t find them and i go
up to
the line that demarcates positive from
negative and i still don’t find him
and then he chats me up again and he
says i made 200
i should have made four to five hundred
thousand and
you know so for the elite traders
one of the things that they have to
fight with is
you know making sure that they make the
most of the opportunities
making sure if they leave a couple of
bucks on the table you know the trader
felt like he left
to 300 000 yesterday morning on the
table
and he did for his skill level that you
know they
remain focused they don’t over trade
they don’t try and make it back they
don’t get themselves into trouble
that uh they they get to that place
where they’re focused and so
for us we we are seizing the opportunity
the challenge is to be focused to be
open-minded
not to come in it’s very easy to come in
and say oh
the electric vehicle space is so
overbought we should be shorting these
um you want to be you want to be
open-minded oh the marijuana sector is
so overbought we should be shorting this
oh
how can the market possibly rebound
we’re going to have a second wave
and we we’re going to go test the the
new lows
so volatility is at levels that are not
sustainable over the
uh over the short period we should short
that so we
we want to be focused and open-minded
uh and and and recognize the opportunity
and when we see the opportunity
we want to attack and attack the moment
for what it is because we’re not going
to get it again
for a very long period of time we’re not
going to trade a market like this
again probably i’m not sure when
and so we’re getting our traders and dr
steenberger
helps our top traders and and all of our
traders with this immensely it’s being
focused
it’s being prepared it’s being
opportunistic
it’s being ready to attack when we see
it i’m being open-minded
yeah i think you make a good point about
being prepared
because that’s something that we’ve
tried to hammer into to our clients and
as educators it’s it’s really like
um it’s either you’re in a in a place
where you can take advantage of
opportunities when they present because
it
most likely we’re not going to
experience markets like we’ve seen
over the last six months again anytime
soon but what we have noticed is you
mentioned 2008 uh 2009-2010 time frame
those presented some really big
opportunities
and the way that our economy is
operating right now where everything is
so
interconnected um i feel like maybe i’m
off base but maybe you guys can can
expand on it i feel like we’re going to
continue to see major moves in
in kind of a similar aspect um with the
type of government stimulus that we’ve
been seeing not only in
in europe but here in the states um you
know we’ve spent more
with this year than in u.s history
combined
like and and they’re talking about
another couple trillion dollar plan
coming out
i feel like the volatility isn’t going
to go away anytime soon
um and so what we’re trying to impress
upon people is that they begin to work
on those skills and develop a plan be
confident in their ability to analyze a
market and
and to make those adaptations that way
when the opportunities do present
that they’ll be in a position to take
advantage of that um
what i think is probably difficult um is
being able to stay calm in the midst of
all of that
and not just kind of sit it out and wait
and so
uh doctor i might ask you what what
advice would you give to people
when they’re in the midst of that chaos
when they’re seeing the market do things
that they’ve never seen before
how do you try to control yourself and
stay calm in that
well there’s an old saying if you can
keep your wits about you when everyone
else is losing theirs perhaps you’re not
aware of the situation
um and so you know
there are occasions where you see
something that’s unprecedented
whether it’s the uh drawing up of
liquidity
during this recent drop or or just
extreme volatility
if it’s something you haven’t seen
before how are you
prepared in your learning and your
experience
to profit from it well you’re not that’s
what makes the unique situations unique
and just because there’s movement
doesn’t mean there’s opportunity
movement is only opportunity if we
understand what the f is going on
right and there are times where we
might not understand what is going on
and so
the number one mandate
is to protect our capital we have to
stay in the game
because eventually we’ll make sense of
it if we talk to the right people
looking enough things eventually the
pattern recognition kicks in
we will make sense of it but you don’t
want to get
caught up in the activity to the point
where you’re trading something you don’t
understand
and where you don’t have an edge
yeah so sometimes the smartest thing to
do is just to sit on your hands
yeah right exactly exactly to sit on
your hands
but when you are backing off risk-taking
you want to
double down on idea generation
you want to double down on researching
and building the ideas
that will be the next generation of
trades
that will make you money uh and so you
read and you talk to people
you study and it’s out of all that that
the next set of ideas come yeah and just
on that
this discussion point has been very uh
relevant for
for quite recent because from a
cross-asset class correlation point of
view
there’s been a bit of a breakdown so
just taking something simply like
a normal flight to quality bid you’d see
it’s something like gold
comparative then to say covert worries
increasing and you’re getting a
different type of reaction now and say
the dollar inverse
relationship breaking down these types
of things sometimes just having the
ability to have the self-awareness
and the observation being made you’ve
already had some success in your
development to get to the point to
observe that actually
the tide has turned or the sentiments
shifted now’s the
best time to become a little bit more
pragmatic or conservative
reassess the one thing i always say to a
lot of the traders i talk to is
the normal pattern will
almost all correlations certainly
they’re always in flux but they nearly
always return to mean over time
it’s just identifying then when you’re
in that change
and so it’s a challenge but i i think a
good step for anyone
who’s in that development phase is just
the identification
that actually and then staying true to
the fact that you’ve made that
observation
that’s a good observation and then
acting upon it
is a good thing yeah jason the one thing
i always admire about
you and akiel and tier one
is you’re consistently putting out
to your community that our job
is to learn so our job
each day even when the market is
opportunistic
is mostly to get better is mostly to
learn
is mostly to grow i’ll share a quick
story about three traders
uh who two of whom work at our firm one
of them who works at another firm
these are three guys who all
made over 12 million dollars in that
trading profits this year
all of them and what do they do
yesterday that’s enough money to live on
for your entire life
what did the three of those guys do
yesterday after they’re having this year
they all got on a separate call
together and traded
the enormous opportunity in what we call
the ev sector
that’s going on in the states and
what was so awesome is that one of the
guys
was blown away at
how much opportunity one of the traders
saw during that day
so one of the traders literally saw a
million and a half dollars of
opportunity
in one trading session and the eb sector
and one of the other guys who made over
12 million
it was like wow i didn’t even think i
could make that much in a day
got exposed to the possibilities from
this other trader
and then the same trader who inspired
that other trader
learned the setups
that he was deploying from
one of the guys at our firm and had
never made these trades before
and is on this call
you know hitting away at this big
opportunity and so
now the best traders get to where they
are
for the most part with very few
exceptions because they’re always trying
to get better
and and that is it should never stop and
it never does stop for them
and one of these in one of these years
they’re just numbers
it used to be those guys thirty thousand
dollars in a month was a big month
you know now five hundred thousand
dollars of the day
is is a good day we’re just moving the
zeros
and you can do that you can move the
zeros
maybe one or two times if you just keep
trying to get better
i think it’s in that’s a good point but
one thing that we hear from newer
traders as they’re getting started
um they really focus on that dollar
amount and something that i’ve noticed
with elite traders is that they kind of
look out of it as a decimal point like
at some point
the dollar yeah the dollar amount kind
of goes away they’re
not they’re not focused on that because
yeah when you do focus on that that’s
when the emotions get
involved and that’s where the fear and
the panic the greed
sets in and they start making those
stupid decisions
or they they go against their plan um
and so it’s happy
it makes me happy to hear that you’re
talking about that from
from your perspective and it’s the same
thing that we’re saying to new traders
that are just starting out
is focus on the process focus on you
know
having a plan sticking to the plan
instead of focusing on on the dollar
amount the money figure
um yeah it’s very interesting
so let me ask you guys this as we as we
kind of go into the end of the year
starting to look into
next year there’s a lot of different
things on the horizon i’m seeing
headlines this morning about
you know british economy shrinks by most
in 300 years i’m seeing something about
oil tanker attacked in saudi arabia and
you know we got vaccine information
coming out we got political
uh power that’s shifting here in the
states we still have international trade
negotiations that are going on and and
it might be changing significantly in
the next few months
um as we go into next year what are kind
of some of those
fundamental aspects or or keys that you
guys are going to be watching
um as big movers for next year
yeah if i could jump in here there’s a
great comment on the chat about how
darren looks like conor mcgregor
damn
you’re on your spot that’s
awesome
that’s the most insightful comment i’ve
heard yet today um
okay well conor mcgregor is going to
give me the smackdown if i don’t shut up
so
okay so yeah
so you know um you know what’s going to
matter going forward
you know one of the pieces of research
that i passed along to traders recently
is what happens in the stock market
when we have very few names very few
stocks
showing distinctive weakness
so for instance in my research i track
the number of stocks making
three month new highs and three month
new lows
i also look at common technical
indicators like bollinger bands
how many stocks end the day above their
upper bollinger band
or below their lower bollinger band well
it turns out that one of the best
predictors
of upside momentum is the
absence of weakness among stocks
in other words if you have very few
stocks making fresh free month lows
very few stocks across all indexes that
are closing below their lower bollinger
band
then nothing is weak and if nothing is
weak
where is the economy going to roll over
yes you could have war breakout
yes an asteroid could suddenly you know
uh smash into but
but uh barring that kind of event risk
if no sector is weak if nothing’s
rolling over
how is the whole market going to roll
over so it turns out that that’s a
pretty good predictor of upside-down
venom the last uh several days last two
weeks actually
we have had very few stocks making fresh
three buck lows
very few stocks closing below their
lower bollinger bands
and so that tends to be predictive of
upside momentum 20 plus days
out so one of the things i’m gonna be
looking for is
do we start to see some sector rolling
over
do we start to see some weakness
somewhere
somewhere in the world somewhere within
sectors in in our market
uh and that will be a heads up for a
possible rolling over
of stocks but until we see that uh
you know if if the fed’s going to be
accommodative if we
end up getting some fiscal stimulus
perhaps from the new administration um
we got a freight train here anthony i
can
i can almost see the your brain spinning
when he’s talking about uh weakness and
how do you feel about that are there
things that are weak out there are they
being artificially
held up or do they they look
artificially strong because of the type
of stimulus we’ve seen
so so for me it’s all kind of um trying
to
almost reverse engineer it so as brett
was it
was alluding to there the fed the
mechanisms of fiscal monetary stimulus
you know what is the chief reason of how
much more will be adopted
ultimately comes down to how the virus
performs because the virus will dictate
then the stringency of lockdowns which
will then
dictate how the economy performs and
then as a net result
the actions that will neces will need to
be taken or at least provided as
guidance from the central bank and so on
so for me like when i look ahead for the
period coming forward
it’s then about okay with the virus and
the the market being quite amped up
now in recent weeks on the vaccine news
is what are the vaccines what is the
legitimacy of them actually getting
regulatory
approval not just being effectiveness as
a vaccine to be
stored as we’ve seen with the
difficulties of say
some of them have had with temperatures
and things like that but infrastructure
manufacturing distribution
phase rollouts in the order of who
actually gets it
before then a more mass inoculation of a
population
for me this is when i talk about all
this there’s a graph in my head
which is the economy’s dipped like this
it’s gone up it’s pointing
central banks are pretty confident with
the monumental stimulus that the economy
is going to go like this
the shape of that recovery is what we’re
trading
and that shape it changes day to day on
the back of
of these these new flow items that come
out so for me is that there’s a singular
thing that i think is above everything
else which is
yes there’s there’s tail risk on a china
even with biden flare up and
war in the middle east with tensions
growing as always between saudi iran
things like this
but ultimately the vaccine and
the then implementation of rolling out
and the timeliness of that through 2021
i think that will be the
the definitive or one of the definitive
themes that will guide
overall market direction but uh the
thing that was really
interesting about this week is of course
it’s now that trump’s kind of gone and
if yelling does come in
the ground is set for a repeat of almost
the type of approach that central banks
adopted post-financial crisis which is
gradual cautious and equities
love that environment um that’s what
history would prove so
um i guess what the upside risk to that
could be
very quick approval and distribution of
a drug and a vaccine then gets
dealt with fairly swiftly um i just
think when you actually get into the
nuts and bolts of
effectiveness and dosage and scalability
these types of issues
on a pharmaceutical level for a vaccine
it’s it’s it’s a challenge let’s put it
that way
uh we’re dealing with something on this
sort of global scale so
um yeah i mean it sounds all negative
but in fact
negative is positive because of the
resulting factors that it leads to which
is more stimulus in a more competitive
environment
in in many in many extents
anthony if i could just jump in you make
a really
you make a number of good points uh one
of the more popular macro
trades has been uh being long
the countries that are coming out of
covid quicker
and being short those that are
struggling longer with the virus
and so you’re looking for economies that
are going to bounce back uh
more quickly and certainly the ability
to
effectively roll out vaccines could be
part of that equation
and could make an interesting relative
trade in macro space
yeah i mean there’s definitely even with
what we know what we’re equipped with
already
a fisa modernist shot is 50 bucks but
then something coming out from
other firms that we’ve seen like astro
and oxford university is is
two to three dollars a shot so if you’re
talking about the
developed and emerging market world from
uh
a vaccine point of view that they’re two
completely different extremes and
um but anthony you know my favorite
single ball scotch
which is a hell of a lot more than fifty
dollars yeah
so that doesn’t necessarily mean it’s a
problem
i’m just saying no not showing off
mike is that is that consistent with
what you’re seeing up there
from wall street is are all eyes on
kovid in the vaccine is that really what
what the focus is or are you guys kind
of looking in some other directions as
well
so anthony is a much
a better expert to lean on for
macro ideas uh going forward
that’s that’s that’s certainly something
that
we don’t focus on we are
looking for uh what we say you know our
system is to trade the stocks that are
in play
and so to us that means we’re looking
for stocks that have a news catalyst
behind them
i have some unusual news or we’re
looking for stocks to have
a technical catalyst uh perhaps they’re
getting ready to break out perhaps they
are overbought perhaps they’re oversold
and
we move around to a bunch of those
stocks
if the market overall is in play if
volatility is high
then then we will move to trading the
overall market
but i will be the wall street simpleton
here
and and tell you that is our
smb system
can i jump in mike uh you know obviously
we work together with the sme
uh uh traders and one thing i’ve
constantly emphasized is that a big
part of the edge among the smb traders
is
not only knowing how to trade but
knowing what to trade
and finding opportunities where there is
movement where there is volatility where
people can make sense of it
uh moving from one kind of stock to
another sometimes moving to the overall
market
knowing what to trade has been
absolutely as
important to the success of smb is
knowing how to trade
thank you much better said than me thank
you very much
well i’ve had my coffee
they should just i should just yield my
time going forward
when we do these these joint events
oh it’s very interesting to get your
guys perspective on it because
like i said you guys each come from a
different angle and
obviously we deal with mostly retail
traders or the people that we’re working
with but we have seen a lot of them that
are making the move
towards uh prop firm and going towards
the investment side
and so if i was going to ask you guys
if you were going to give some people
some advice more from like retail
doing individual type investing um
what what type of advice would you give
them from the experiences that you guys
have
on how to deal with um being flexible or
being able to adapt
and and see opportunity as it arises
yeah i’ll jump in and then i’ll take my
meds and shut up
um just saying
um the number one predictor of success
in various fields this comes from
research in psychology the number one
predictor of success is
mentoring learning from
experienced people learning with
experienced people
i teach in a medical school that’s how
medical students become physicians
is by studying with actual practicing
doctors seeing how it’s done
and doing various rotations and you
learn from example you
learn from role modeling and mentoring
and so the best thing to answer your
question that traders can do
independent traders is join trading
communities
if they’re not joining trading firms and
find people to learn with to learn from
and that will accelerate your learning
curve
oh well i love that i think mike was
right i’ll just yield my time to brett
and he’s on a roll
well you know i was actually thinking
about it this morning because you know
we always tell our traders that they
need to have a plan that
they should be back tested and have a
clear you know if-then syntax
and that type of thing uh but on the
flip side again looking at this year
nobody had an iftan syntax for covet
like you there there has to be room to
adapt and and make some changes and then
also like you said being
open to continuously learning um that’s
really one of the reasons why we want to
bring you guys in because
having that community having the
different perspectives it gives you some
more
insight but also benefit from the
historical perspective
that you guys have and also like the
historical perspective that back testing
brings and being able to look at
how did the market react as a whole when
we hit 2008-2009 what were some of the
commonalities between
then and now um and ultimately the idea
is being able to take that information
and use it moving forward so that when
we have some major
shifts in the market in future months or
years that
instead of sitting back and looking at
oh the things that i wish i would have
done
or instead of being just steamrolled by
by the changes they’ll actually be able
to look at it and kind of make some
some predictive analysis and put
themselves in a position to to take
advantage of that
um so i know we’re we’re kind of kind of
running up against the end of our time i
know
you guys are all very busy men and i
don’t want to take up too much of your
time but i would like to
we got a lot of people here and a lot of
people are going to be watching the
recording
um so if if guys want to find out more
about what
each one of you guys are doing if they
want to follow you how how do they
how do they get in contact or follow
learn more
okay thank you very much yeah so as i
put on the chat
uh my uh blog site is trader feed
t-r-a-d-e-r-f-e-e-d all one word
traderfeed.blogspot.com
so old school with that url
so traderfeed.blogspot.com and
all my contact information is there
there are also links to the articles for
forbes that i write
there are blog posts on trading
psychology
and there’s a link to a free blog book
that i wrote
on the topic of training and
spirituality
which is a different topic yeah yeah
so uh how do we take the ego
out of our trading so that’s linked up
on thetraderfeed.blogspot.com
site and my email address is there and
uh i welcome
any questions people might have awesome
perfect thank you anthony how about you
how can they follow
yeah i mean they’re i guess just
incorporating this into bobby’s
comment he’s just left which is a lot i
guess access to
learning how to develop fundamentals um
or
certainly macro some of the stuff i
talked about um
it’s not a kind of binary fixed thing
you’ve got to have it’s got to be
developed over time so i do a macro
briefing that i put out delayed but onto
our amplifier trading youtube channel so
i’ll put the link in there
but the best thing to do is have a look
at those
see then the type of stuff i’m talking
about how i’m isolating certain types of
narratives and things like that of what
i think will be in focus
and then just leave me a comment i’ll
always reply i’m absolutely happy to
help
and engage in that way on the channel no
problem at all um you know with the
fundamentals my
main advice i’d give you is that you’ve
got to
have a realistic expectation i would say
i know
a little about a lot if that makes sense
that allows me then to structure
how i can interpret news and things like
that but that’s born out of
you know near 15 years experience now i
certainly wasn’t like that in the first
few years
you have to kind of i think of it as
little blocks
and right now let’s say trump presidency
or the u.s china trade war they’re just
little blocks that you accumulate over
time
and everyone’s a singular episode that
you then put in your your data bank
which is up here
and it equips you better than for the
future and you know as long as you can
research and understand each of those
concepts as they arise
at each point in time you will develop
you know undoubtedly over time the main
game then is about being consistent to
allow yourself that time for that
development
absolutely well well said and mike how
about you how can they how can they
follow up
learn more about where if you want to
see us
mentor some of our prop traders in real
time
you can follow us on youtube where we
share videos
of us doing that with our traders and
learn some of the lessons that we’re
learning about markets
awesome and i’ll share all those links
with this video today so that everybody
can go and learn more about you guys i
know like i said we have
we have i think probably a record number
of traders that have come through our
program this year and then moved on to
prop trading opportunities um and so i
know there’s a lot of interest in that
and i can’t think of a better place to
to send them so like i said we’ll share
all those links again guys thank you so
much for coming in today
i know this was i mean this was great
for me i know it was great for
everybody else you guys brought a ton of
value uh to our session
and so i i wish you guys the best um
happy thanksgiving for those of you here
in the states that celebrate that
um and uh hopefully we’ll be able to do
this again sometime hey go ahead and
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