In this week’s episode of Beyond the PDT, Matt and I had the pleasure of talking to J Trader. He is a very well-seasoned veteran in the trading community and has been trading for nearly 20 years now. With all of this experience, it is clear that there are a lot of great bits on knowledge to be picked up in this episode.
However, as I say every time, it is nearly impossible for us to fit everything into just this blog post. If you have time, be sure to check out the full episode which can be found here. These interviews have genuinely helped both Matt’s trading and mine, and we think that there are great lessons to be learned regarding risk management, discipline, and even some trading strategies you may not be familiar with. We hope that with these episodes, we can help you in your attempt to make it Beyond the PDT.
How Did J Trader Begin His Trading Journey?
Having been involved with trading for so long now, it made us wonder as to how he actually got into it to begin with. Because of the time frame, he did not have a lot of resources out on the internet which made it much harder for a lot of people who wanted to start trading back then to get a true start at it. However, J Trader was in a relatively unique situation in which his parents were both involved in the markets having worked for some large firms in New York City when J was very young.
Upon moving to Rome, J Trader would walk with his father down the street and every so often they would stop in front of screens that had tickers reading on them. His father would tell him, even when he was only 8 or 9, that he needed to learn to invest when he got older. Around the age of 19, J Trader began versing himself in the markets with the help of his network, and from there he became who he is today.
What Types of Stocks Does J Trader Trade? Does He Have a Bias?
J Trader tells us in this interview that he does not play one particular type of stock or one setup either. In fact, he even tells us in this episode that he plays options as well and over the course of his 20-year career, he has traded a number of other markets. At the time, though, his primary plays are both in the options market and with small cap, low float runners. The reason for this is because he – like many of us – love the volatility that come with these small cap plays.
It is the same reason that he trades options frequently as well, though, as there is the potential for a lot of upside when the opportunity presents itself. When it comes to options, he particularly plays stocks like TSLA, AMZN, NFLX, etc., of which have a lot of volume and decent range on the day.
That all being said, there are times when he plays large caps as well. The reason that he tends to stick to small cap low float stocks is because of the volatility that comes along with them. However, this is not to say that large caps do not get volatility and when they do, J Trader will play them as well.
Regarding J Trader’s bias, he does not have one that he focuses on 100% of the time. Because of the nature of low float stocks, we know that most of them fail and the inevitable edge is generally short (when patience is able to be attained.) That being said, it is also clear that there can be a very strong edge going long when these low floats have news. Seeing that J Trader has been doing this for such a long time now, he has recognized how to attack both long and short with these low float runners and is able to play both sides of the run.
Does J Trader Have a Strategy?
As Matt mentions in the beginning of the episode, J Trader has what he calls his “J Lines” of which are a particular and undisclosed indicator that he uses to gauge some of his trades. He has not told us whether or not this is the only indicator he uses, nor has he told us if this is his only strategy. However, they are simply a set of lines that have the ability to give confirmation and a set/defined risk level to play off of.
Furthermore, by using these lines he is able to develop the bias that he would like to use for the particular trade. That said, this is the same way that a lot of people use something as simple as VWAP – they are nothing more than a set of indicators that work for him.
Psychology and Small Account Advice
J Trader and I have a very similar outlook on discipline when it comes to trading. This is something that I have even posted about on Instagram within the past few weeks. The idea is that finding success in trading simple comes down to your mindset. Hard work and consistency are what makes a strong trader, but this is hard to do when you do not work hard or have consistency elsewhere in your life.
Like myself, J Trader works out quite a bit. I personally like to think of this as something that is very similar to trading. A lot of people want to do it for fast results, but they do not know how to stay consistent with it. Furthermore, some people may be great at going to the gym every day but have an awful diet and are not disciplined in that regard. It takes working hard even when you don’t want to in order to find success in something like working out, and J Trader tells us the same is applied to trading.
Those who can find consistency elsewhere in their life paired with hard work are likely to have a better shot succeeding at trading because they will know how to apply those same values to their trading.
For small account growth, J Trader tells us that it is something that is very possible. However, because of the short-term mindset, people want to grow their $2,000 accounts into $1,000,000 accounts which is simply not possible. Instead, he recommends that we all look to take those small accounts and turn them into a more achievable number such as $10,000, and from there turn that into $20,000, etc. With time, goals will be achieved.
Simply put, this was a fantastic interview. There was so much great advice that was given throughout and it is one you are not going to want to miss. J Trader is so experienced, and we feel that there is a lot that can rub off on you if you are able to apply what he has mentioned to your trading. We hope you enjoyed this week’s episode and that through these interviews, we are helping you find ways to make it Beyond the PDT!