The Dirty Secrets of Trading | Documentary

0:28 [music] A retail trader is a trader that trades their own capital with the hopes of making pretty good size returns. [music] There's not much of a information disadvantage. Now, the bigger problem for retail traders is [music] where there's too much information and trying to process all the information that's out there. >> It's [music] amazing. It doesn't matter where these guys come from, a lot of them have got so many shared experiences. Some of the things that have happened to them that have befallen them in terms of their early trading [music] careers. So we're here to try and put those stories to write and uh give [music] them a much better background and uh understanding for

1:14 going forward and actually becoming profitable traders and trading as we would in a professional way. [music] sometimes revenue expectations but basically forward 3 to 6 months you know expectations right forward >> because you don't pay something for performance because if you're buying it already gone right >> first thing we do we're going to do what we call lossaholics anonymous I want tomorrow all of your stories,

2:00 where you've lost money, why you think you've lost money. By getting all your stories out on the table, everyone will learn from them and then we move on because no one will make the same mistakes again. >> Cheers, guys. >> Cheers. [music] >> [music] [music] >> In terms of the infrastructure of the industry, the retail trading industry, the institute has been part of it over

2:46 the last seven years and there have been some quite big changes and meaningful changes. So for example like in the US uh these things that we discovered years ago called IB agreements introducing broker agreements whereby you have an individual who professes to be an expert in trading uh teaches retail something and introduces them onto brokerage platforms and they get ongoing lifetime rebate commissions from the trading activity of that person which obviously creates a huge conflict of interest and we've been talking that about that for a long time. Um, in the United States they were banned years ago and outside of the US in the rest of the world uh they

3:33 still exist although there's been some regulation changes uh over the last 2 or 3 years uh where those agreements have come into focus. 2011 12 we were literally turning up to brokerage companies and saying okay you're putting an in introducing broker agreement in front of us and we're saying okay well what if I wrote a zero on the contract and we had a lot of push back why because the brokers actually want people to be incentivized to make people or teach people to trade high volume strategies like day trading. So obviously day trading guarantees a certain amount of trades per day which generates more commission. The brokers then came back to us and said okay we'll

4:19 accept them. Now that that was a big change in the industry because we literally invented 0% introducing broker agreements and the effect that had was that the brokers started looking at all of our students who were going on the platforms and saying well okay we get to keep all of the commission and we don't have to pay it out. So why would we pay an educator >> right? who brings people on. So this kind of disrupted the whole industry. So what's actually occurred in the US is that retail have moved over to more leverage products like trading options and outside the US uh retail traders still trade on uh predominantly CFD contract for difference where they get a large amount of leverage. But what it comes down to is really the same

5:05 problem. There's the products, there's leverage, but people have no idea why they're trading these products essentially and on top of that why they are using them as uh an instrument to represent a trade idea. It's the same problem in a different rapper because what it comes down to is just having absolutely no understanding of how to generate a trade idea and then using a product to represent this lowquality reason to take exposure in an asset class. And then we started bringing in mentors not just in the US but in the UK uh Middle East, Asia,

5:52 Australia, all around the world. And that basically solved the second problem which is generating ideas. So teaching retail traders how to generate highquality trade ideas and express those ideas using the different products like options in the United States. Now the big key difference there is between what we're doing and what all of these so-called educators out there in the market are doing uh is that every single guy at the institute actually has a professional background having worked at investment banks and hedge funds and that has to be proven before they come in. So they're not guys they're not guys

6:39 who are public speakers. They're not guys who are salespeople. They're not marketers. So we've literally invented 0% IB agreements that's changed and disrupted the whole infrastructure in the rest of the world. The mentors and the regul the regulatory history that these guys have in the professional world that's disrupted everything as well because now everybody now questions everything which is brilliant. We absolutely endorse that because from our perspective, we've got an organization that's just full of professional traders who have the 10, 15, 20 year experience and have made tens of millions of dollars trading financial markets. So for us, it's fine. Whenever someone questions someone's background, dead easy. Just go online,

7:24 go to the regulators, find out their background. You know, we literally started this from zero. And if you look at our risk on a daily basis as a community right now, we're typically $150 million of risk every day. So, you know, starting that from zero and getting to this point, it's really testament to what we've actually done because the reason for the success is because we've just gone out there and told it how it is. So, retail traders get to understand the retail trading infrastructure. And people come through the institute who are genuinely understanding that infrastructure and who are committed and that's the place

8:10 to start. You have to start at the point where you really understand the industry and how it works. Now all of our mentors obviously have a ridiculous amount of professional trading experience. That's why we've brought them on board. So, while we're out here in Thailand, uh doing our program, um I think it will be useful if uh you ask these guys questions about the retail trading industry, they'll be able to answer those questions inside out because they've been in the game for a very long time. You know, these guys really understand how the infrastructure works and uh I think the viewer will get a proper insight into exactly how that works and that's really the first step.

9:00 Uh I did the um 90 909 90 three times. Uh first of all with stocks. >> Yeah. >> Then with options and then with forex. And although I did think I always had discipline and um I define my stops and everything like that. When I funded each uh account, I got a little bit too overconfident with certain trades. But I didn't realize exactly what I was doing at the time, but I was just breaking all the rules right from day one. It was a long only uh strategy as well. I think on that one I had 100,000. So there was no real strong defined strategy on ATR or anything like that. >> So what did you learn in in the on the option side? >> Oh, they uh they baff your brains with

9:45 science there. There's all sorts of uh different options and very difficult to grasp them all really. Rebates on a commission basis don't exist in the US. They were banned in 2010. So IB agreements were banned in 2010. >> It was prior to 2010. So >> Oh, good. Well, there you go. You've been screwed. >> Yeah. >> Right. >> Uh moving average and all this stuff. uh patterns and yeah just bought everything overleveraged went up to a million and then >> how much did you have in your account? >> Well I started with 20 then lost lost lost uh leave it with uh was until 10

10:31 approximately 11 and then stop stop and wiped out one day. >> So what made you open your account? um just advertising >> where >> on the media every everywhere came as well from real estate. I knew few guys that were doing but like arbitrar I think >> right what but back in ' 90s we are doing this stuff >> and online learning with like technical and broker explained some of stuff and 80% of the time it breaks and so you've got 20% chance not having it and this stuff >> but this is the difference between like technicals and fundamentals right if you take a >> company report annual report and you do a real fundamental analysis on the

11:17 company and understand the key performance indicators of that business and the industry that they're in. So I basically invested in a company Zinc Recycling Factory. So they make money based on the price of zinc. So, I was basically trading it based on uh I guess the Warren Buffett style of investing where you try to find a deal when the price of the stock goes down and then uh try to double that. I bought it based on uh following two hedge fund managers. Uh I just kind of cotailed them, I guess. So, I figured once the price skyrocketed or went back up, the price of the company would go up as

12:04 well. They ended up filing for chapter 11 bankruptcy. Basically, it went down to zero%. Yeah, I I lost all my money. >> So, where do you get the information about the two hedge fun managers being buyers of the stock? Where did that where did that come from? >> Uh there's a free website, but basically it lets us know which hedge fund managers have positions in what. Like, >> so they're basically monitoring SEC shareholding filings. >> Yes. I think they had five more than 5% uh in the company. So they had to file, >> right? >> All right. Okay. And they'd accumulated 5% holdings, >> right? >> So just purely on that basis, >> right? And the price was going down, >> you'd follow them in. >> Yes. >> So rather than that being something

12:50 where you've, you know, gone in and got massively leveled up or something, >> right, >> it's actually just a question of putting all of your eggs in one basket. >> Yeah. Yeah. And you hadn't done any basically no kind of research on the stock really. No, not really a process at all. Just following some allegedly smart money. Right. >> Right. Right. >> And I did actually course in Fort Lord close to Miami and they even taught me how to like overall stock market and they said you can use exactly the same approach to the Forex. Exactly the same. Just look at the chart bunch of patterns. It looks very smart. Then I narrow down to let's do simple supply and demand. >> Just see with a good stop loss then stop

13:38 loss keep triggering then you go lower in the stop loss. So make sure that you're not going to stop out because usually you stopped out and then the it's going other directions. This is just as long as it hit this supply level. >> Okay. >> And it kind of turning around that's the way to go like you have to put a position. >> Was a little addicted. I remember I was trading even on the phone and like in three minutes you make thousand dollars like wow it's working. At some point I just stopped doing stop losses at all because it was just annoying. It was like stopping me out and then going the direction that I supposed to be supposed to go from initially like on the pattern. You kind of see in the past it worked. You can see that it's been supply demand. >> Yeah. That's why you sign a piece of paper when you open your account with the broker which says I understand the

14:24 risks and I understand that the past has no guarantee of occurring in the future. >> But where was the the broker regulated? >> I have no idea. Didn't care. Didn't know. They taught me how to do just follow the charts patterns. I did um some good trades but over overall in the end of the day I was overleveraged one to 100 and I was uh like quickly wiped out. I tried it several times. So it didn't work and that's why I was searching constantly for the great educator for someone very professional who knows what they doing. First of all when you talking you understand wow like I didn't do my due diligence. I didn't

15:10 look for the great mentor and you kind of talk about it and you understand what mistakes you've done and then feedback from Anton and the group it's super valuable you trying to wow like mind opening and eye opening >> I've done forex trading on CFD >> just a very small account only €1,000 >> I've watched some videos there there was a guy online and he analyzed the market to the ducks opening and also some currencies and he wrote a book on Forex trading. >> Okay. >> And he has his own like he built it up his own academy. >> Okay. >> What's his background? >> I don't know. >> He said like he he's trading other

15:55 people's money but he never proved it. >> Yeah. You can't. >> So >> unless you're regulated, you can't. It's illegal. When I started looking at commodities, it seemed like those were more the real engines of the economy rather than slips of paper that you can't do anything with. >> So, I was always kind of, you know, kept an ear open for learning commodities and found out about a commodity system, made some pretty incredible claims and I didn't really trust it. So what I did is I went and bought the back data all the way back to like 1972 of commodity pricing. I wrote a program to trade it according to the system. And every time I found a bug, the returns improved till the point where I got really confident

16:41 that what he was describing is how this works. So I started doing it, showed it to my family, they put money in, we formed an entity and first two years were just absolutely phenomenal. So I made a lot of money there, made a lot of money again the following year and then we got into this cycle of quantitative easings, central bank announcements during the middle of the night and I'd wake up in the morning and there's a 20% drop in the equity curve. >> Yeah. So when things like that would happen, markets that I thought were uncorrelated were suddenly correlated when a central bank does something. >> Yeah. >> It sends a shock wave through everything. >> Well, futures are levered to begin with. >> And that's why I I learned the meaning of volatility running this,

17:27 >> right? >> This entity cuz you know 20% >> Yeah. >> up days and 20% down days had more down days than up days. >> Yeah. I remember at one point the whole account was sitting at just under a million and a half dollars and my finger was hovering over the mouse button to sell. >> Yeah. >> And I thought, "Wait a minute. This is a system. I have to trust the system. The system got me here. I got to let the system work." And I pulled my finger away. I woke up the next morning. It was down 12%. >> That was right before all the quantitative easing stuff happened. You can look at my equity curve and it's just boom boom boom. You know, part of being regulated and just the way I did things is I always sent out monthly statements and told them exactly where they were and they could move money in

18:14 and out at will. And so >> it was >> Yep. >> All right. >> I'm not ashamed to talk about those losses and what's happened with my system. And that's a big reason why I'm here is to fix those inadequate inadequacies and understand how money is professionally managed in a very different way. Focusing on the risk side, which is something that's been missing in my trading since, you know, 2006 when I started. People were going through past trades that they've done, uh, past trading accounts that they've managed, why they've lost money, or why they think they've lost money, and then we're actually telling them why they actually did lose money.

19:08 [laughter] That way. [music] >> [music] >> So, Raj, thank you very much for taking

19:53 the time. The reason I wanted to talk to you is because I've been speaking to our students, many of whom you will be mentoring. >> Um, and some of them have lost $10,000, some $20,000, and actually a few of them have lost a lot more than that. M >> uh turns out that they were learning information that they thought was relevant to financial markets and trading from self-proclaimed trading educators after that. So how do these guys who have literally no experience trading? >> How do they even exist and how do they get away with it? >> Yeah. So these trading educators, I think there's about four common methods that they all use. Uh the first one is they create this fake backstory. they um clearly exaggerate or just create this

20:40 background, their uh experience and this uh track record which just doesn't exist. They'll put in Excel like I bought 50,000 shares at five, I sold 50,000 shares at 9. They'll show a $200,000 profit and it'll just show up on the front of the of their Excel sheet and no one can prove it. >> So people will see a website, they won't see an Excel sheet in the back end, but that's what it is, >> right? They'll just show a profit on the on their website which no one can verify and it's clearly false but there's no real way to verify it. In fact, they've done some other methods like um for example, they'll create one account where they'll buy uh have a a long 100 shares of something of XYZ. the other one share in the other account they'll be short 100 shares of XYZ and clearly one of them will make money and they'll just show that on the uh on their

21:27 website and to prove that they made a lot of money you know and um yeah it's so actually what's happened is since like 2016 we really um you know went into overdrive and shown that you know these fake uh educators are basically showing fake money or fake P&L so they've had to delete these equity curves but they've still had to you know um push push this narrative or this backstory that they've been profitable. So because so many uh articles have been written about them as very rich and successful traders. So they've from so what they've had to do is they've had to move on to other methods and techniques to um show the the world that they're actual profitable traders even though we know and we know for a fact that it's untrue. Yeah. So, the second common

22:12 method I've noticed is they they create this this lifestyle narrative where they push this narrative that they've got uh fancy cars and they live in mansions, they're on yachts, they have fake girlfriends that are paid for by the day models. They'll even have fake students talk about how much money they've made by following this uh trading educator who's changed my life and turned uh $1,000 into a million dollars. And they'll even show like fake money that you can buy fake money online. You can buy 10 for $10 you buy $100,000 which is the money they use in rap videos like in like a like a ludicrous rapper rap video and they'll make it rain in casinos or other types of

22:57 environments. >> I didn't know trading was a cash business but they >> Well, apparently it is. >> So Raja, what else do these trading educators do? Yeah. So, one thing we've noticed recently as as these trading educators uh sales have declined because a lot of their uh claims have been debunked, they've switched over to this philanthropic um model. Basically, they're claiming that they're they're rich philanthropists that are um taking the money that they earn that are given to them that is given to them by you and they're going to Africa and taking videos of them in front of a school where uh African toddlers are going to learn how to read or they'll go to the Philippines where a monsoon's hit and they'll donate money to this charity

23:43 that will help these less fortunate. you know, they they've they've basically tried to push that they're uh they're Richard Branson or Bill Gates where they're so they're just trying to help the world rather than in truth what they're doing is they're using they're using this as a direct marketing expense and they're just um taking that as a tax deduction and just taking money in for them which is pretty shameful to hide behind the the ruse of a charity to get rich. So the education can no longer sell on its own merits. So now that they're they're pushing their product to appeal to your heart rather than your mind and you almost see it as a donation to help the less fortunate. So finally what they're what these trading educators are doing now is they're creating these subscription chat rooms where you have to pay a fee to get into

24:30 these chat rooms and all they're doing is pushing this technical analysis nonsense which you can literally learn for $20 off a book on Amazon. And you remember these trading educators have no experience. Uh, if you want to know what a real what a professional trader or any trader actually if he has any real experience, go to FINRA in the US, go to the FCA in the UK or in Europe, go to ASIC in Australia or really in any country. You can literally just type in financial regulatory authority, insert country name, and then find out if this tra this trader has any real trading experience because remember it, you know, it it exists online for 10 years or more if you were ever a professional trader. You know, it's I it's I find it

25:16 very funny that um retail traders will spend, you know, uh six hours to figure out where they're going to dinner by going to Yelp or Google or uh Google review or Trip Advisor, but they won't even spend 15 minutes to see if the trading advisor that's giving them advice actually has any real experience >> of running money professionally. Managing other people's >> Exactly. I mean, and then they'll on on their websites, they'll even have fake testimonials like they do on uh like Trip Adviser or like, you know, anytime a c a restaurant opens up right away, you can see there's 20 reviews right away from all their friends. This is what they get. This is what they do on their website. Even though we know for a fact, >> it's not real people. >> Sure. Sure. You know, sadly, people do fall for these techniques.

26:03 >> What is their target audience? >> Yeah. What's it's sad that but what they're really targeting are people with IQs of say lower than 90. You know, unfortunately they're also and the people that fall fall victim to this are usually u people with less money, people that are unfortunately less welloff uh minorities pe uh immigrants where they don't have any credit. So they'll run up debt on their credit cards and it's just this downward spiral of um losses. you know it. What they're really just going after are the financially naive because the financially slightly superior will realize that this is a hoax or ask the right questions. Instead, they just go down to they they just target these people with very aggressive um marketing techniques and

26:48 then once they're once they have them hooked, they'll uh lose all their money and then they'll move on to the next victim. So Raj, how does this tend to end for the retail traders, these students of these educators? >> Yeah. So what usually happens with the retail these retail traders will trade for a while, then they'll lose a good bit of money and then they'll just get frustrated and then they'll just stop trading. They'll just they'll think to themselves that um they're just really bad at it. They've they've been properly taught and they just can't make money and they'll just go away. and the re the trading educator will move on to their next victims with their fake broker statements or fake tax returns where they're literally I've seen this now they're literally photoshopping fake numbers into these uh broker statements

27:33 and showing them to their potential customers of the money that they've made in the past. I mean, laughably sometimes I'll see where they're even in a different font >> and these borderline criminals are just showing, you know, fraud to, you know, to to lure in new clients. And it's just sad and it's something that we in the institute are trying to shed light upon. Listen, 95% of what you learn from trading educators online is complete and utter nonsense. I know this because I worked on Wall Street professionally for 15 years and I've run option trading desk at Bank of America, NORA, BNP and really all Wall Street professionals know this but unfortunately most retail traders do not know this. >> So how can retail traders bridge that

28:19 gap? Can they bridge that gap? >> Well, sure. Well, the first challenge is for for them to for retail traders to understand the industry properly. And once you understand the industry properly, then you can start to make progress in trading the financial markets correctly and profitably. >> Good place to start. So that's the [music] last quarterly report. >> Ah okay. Right. So uh so today's homework day. This afternoon I've come down here to make myself [music] available for the students along with the other mentors. Um, and basically, you know, we're here to sort of give them a steer and help them if they're coming up against any, you [music] know, sort of major roadblocks. Um, so it's

29:06 not really about spoon feeding them. We're actually just [music] here to sort of get them over any road bumps, queries, etc., and just sort of set them on the right course. The market doesn't break their hands, [music] but what do they break? Maybe there's a break up party with the company or something. >> Okay. The [music] assets, do they break the balance sheet? Do they break the revenue? >> Yeah. So, uh, today I've been looking for short ideas. So, up nice and early in the morning. Uh, just thinking about from the macro perspective of things that are going on around the world, see [music] who's which sectors are exposed to different countries. Uh, so yeah, I think I found a short idea. I literally just dip in, get call and then uh probably five minutes and then get get straight back in there. You know, it can become a little bit frustrating at times

29:52 when you're looking at so many numbers and and sometimes you can't get the right number and you just got to be persistent and then sometimes it's good to just, you know, let your mind relax just to refresh. [music] Uh and then yeah, you you end up getting more ideas. You get more ideas sometimes when you're not staring at the screen than uh than when you are. So yeah, so mainly before [music] from a stock market, I've literally got hardly any experience. Didn't really know much about the market at all and mainly technical analysis as well. [music] So just starting the course uh a couple of months ago um online, it definitely gives you a completely different perspective on the markets. Um [music] I mean it's nice and easy looking at the numbers, but until you actually realize what those numbers mean, it's it changes everything. So, uh, yeah, it's just,

30:39 [music] yeah, I can't wait to get going and just get a good portfolio together. [music] Um you're based in the UK where there's obviously a very mature uh retail trading and brokerage industry. Um what changes have you seen? >> Uh the biggest changes were the ones that took place last year in 2018. Um and these were changes that took place at ESMA which is the European Securities

31:27 Market Association. And basically, you know, I'd advise people to Google that and have a look at the the changes that took place, but I'll give you a flavor, sort of a top level summary of some of the things that they changed. So, the big thing was that they raised the initial margin requirements for retail traders uh in terms of deposit the capital they need to deposit in their retail trading accounts. So that means of course conversely that's lowered the leverage that retail traders can obtain from their brokers. So I'll give you an example in equities the initial margin went from 10% pre the changes to now 20%. Which obviously means five times leverage >> as opposed to 10 before. >> Exactly. And with uh major FX pairs, the

32:15 initial margin has gone from 1.5% to 3.3% which sounds like small numbers, but of course that's more than a doubling. Um we would actually argue that the the FX margin requirements need to go higher still actually. So since 2011, we've been arguing that you need to put in a minimum amount of capital into your trading account because um under the previous regulations which we were talking about um people would open accounts with $500 or $1,000 and then take massive leverage. This is the way to blow up. So we've always been speaking and and and saying to people that they need to deposit at least $15,000 into their account. As I was saying uh in terms of

33:02 the initial margin um we don't think that you should be more than five times levered um in terms of equities and not more than eight times levered in FX which of course is still well within the current limitations um and that that's a sensible course of action once you've actually started to make money. There also there used to be things like um you know incentives for people to open their accounts. So, you know, open an account, get a £500 bonus, something like that. Referring people, you know, referring your friends. The new regulations um that ESMA have introduced have have certainly reduced those types of incentives. And actually we again were a leader in this respect

33:48 because we were the first people um anywhere that I know but certainly within Europe um that introduced these things called 0% um introducing broker agreements. And effectively what that means is that we never ever receive any compensation or incentive for any institute traders opening their accounts. And so we've got absolutely no conflict of interest. So those types of incentives, they're not completely closed, but they've certainly clamped down on them. And there's also they now have to declare a kind a kind of like standardized warning in in their promotional material in terms of um the risks that are inherent in um trading financial markets and particularly trading on high leverage. So I don't

34:34 think that ITPM's im influence on the industry can be understated. So for example, regulators from the FCA, which is the regulator in the UK, have actually been coming to institute seminars that we've put on in London since around 2012, 2013, actually asking us questions about the kind of riskmanagement policies that we um ensure that our students um implement and actually asking us, you know, what we think are the sort of appropriate levels of leverage, appropriate levels of margining. um and also um you know account size. So we've made it really clear to them that we thought that you know 10 times leverage in equities was way over the top. 100 times leverage on major FX pairs absolutely ridiculous. So

35:19 that of course um has meant that those people who you know who kind of believe that dream of opening an account with $500, $1,000 and becoming a millionaire, thankfully they cannot be um exploited, shall we say, now and we think that this is a direct result of conversations that the institute has had with regulators particularly in the UK. So we're very proud of that. Uh I think people would probably be interested to know that in the last seven years the number of institute traders has grown um so impressively that we are now um if you aggregate all of our London and all of our UK and and European institute traders together, we're probably the biggest retail broking client in London.

36:06 Um, and that is because a we've obviously grown our business, but it's also b because our guys don't blow up, which means that uh, you know, we we are there um, in terms of retention for the um, for these accounts. And these guys, they're not going to go bankrupt and they're going to be there for the foreseeable trading their assets to their trading accounts. And um, that makes us actually quite a valuable client >> for brokers. >> Yep. for brokers. >> Our guys survive and many thrive as well. >> Absolutely. They they do more than survive. They a lot of them are absolutely thriving with, you know, impressive returns that professional traders would be very proud to have. And also we're talking about risk adjusted returns. So adjusted for volatility of

36:53 P&L. >> Fantastic. >> F1.4 F2.61. >> Right. Okay. What did you say? What's 30? >> 36. >> 36 cents. Right. Okay. So, we'll stick that in here. >> F1 we had is 40 as well. >> Yeah. >> 40. >> So, I think there's there's some problem there with the way that that that's been brought in because clearly we can see from looking here that the 40 cent number is actually for 2020 which is F2. Mhm. >> I think the uh the data part it takes a few sessions for them to get comfortable with it but once they get through that it becomes second nature. The qualitative part however there's always

37:39 going to be holes in it and even a if me and Jason for example were discussing a trade idea I would ask him questions that he might not have thought of. So it's constantly a uh it's a work in progress. >> We've got three um patents that are pending at the moment uh for their technology. So they're improving and investing the technology to increase services to their existing dealers to increase the price of their monthly subscription. One of the biggest differences between retail traders and professional traders is retail traders think in terms of what's my upside. >> Most all all good professional traders, not all professional traders, but all good professional traders always think firstly what's my downside here. >> It was good. I I thought it was very beneficial because obviously when you're generating trade ideas on your own, you

38:26 don't really have a sounding board and obviously you have confirmation bias. You think every idea you generate is amazing and um and you you know with that bias you overlook potential weaknesses and risks in your idea and I think the the critical feedback from Jason and Raj was very beneficial and they they really helped sort of us finesse our process. Um so that was good. It was really nice to have. But I know I I got burned by by shorting a a stocks because overnight there was an announcement that there was a takeover and I and I got shot and the the price shot up and I lost quite a bit. I think it's in the region of five figure. >> Yes. With within a night overnight

39:13 >> on a short. And so what was your trading methodology before? What was your trading strategy? >> It's it's more of a technical when they break certain certain uh threshold we will short it and uh basically we are doing some swing trades over a few days. That is why I find that this fundamental classes are are actually very powerful and very useful. It is very hard to find uh people teaching macro hedge fund long short strategy in the market and I I was trying to look for this for a long long time. >> Do you think it's hard for retail traders to to learn about macro and fundamentals on their own?

39:59 >> Well, if if they of course if you're going to do it by themsel I think it will take a long long time and I don't think they would be able to do it actually. I suspect so >> you you can't just find it over through through the books or even through the internet. >> Is there too much information? >> Yes, definitely. You need someone that has been there uh who could summarize and summarize everything and make it short for you and you you'll cut short a lot of the learning curve the whole learning curve. Yeah. They the wording they're using is the merchant merchandising team has successfully mitigated cost pressures from the 10% and they're implementing solidar plans for for the other 25. We got to go back and do a bit of more

40:45 homework and look at the um super sector and pick out the um the bigger companies and uh see what they're doing and uh do they have a similar uh process as what company we've selected and uh and work out those differences and where our companies um has got the upper hand on um on the synergies. Um yeah, >> I think you need more information on the way that the tariffs have affected the business. I'd like more information on the um net profit margins. >> We'll go away. We'll think about it and then we'll we'll adjust our thinking and then uh and do it again. >> What you've just witnessed is actually the difference between what professional traders do and what charlatan educators do.

41:31 >> So imagine that one word document >> and imagine what they tell you before. >> Right? >> Follow this line on the chart. This is how you make your decisions. What's on that onepage document? Totally different. >> Right. >> That's the difference between professional traders and charlatans. >> You've just witnessed it right there. >> Oh, this one. I've been trained by educators before and they didn't come they didn't have the same types of processes as what you learn here.

42:16 >> Yeah. A little bit my process before I actually started with the institute was mainly technical analysis. So we choose a stock or a currency on technical terms and trade it to another technical level before we get stopped out trade. Yeah. Or get stopped out. Yeah. More often than not, it was getting stopped out. Fortunately for me, >> that's why I'm here. >> Right. >> It's enlightening to see what types of process these professionals go through. And there's a lot of work goes into it. And it's hard work at first, but the more you do it, the easier it becomes. [applause]

43:10 in the retail trading industry. It seems quite obvious that there's a lot of misinformation out there and poor information delivered by people who, as it turns out, don't actually have professional level trading experience. And I emphasize the word professional. How should people go about learning how to trade financial markets properly and successfully? >> Well, this is something, you know, coming from the professional side of trading that I've never understood when I look at the retail trading infrastructure. People seem to go about learning how to trade in a different way to just learning uh any other new skill. So I always look at for example uh the classic four stages of learning which is basically unconscious incompetence,

43:55 conscious incompetence, conscious competence and unconscious competence. And the problem with most retail traders is and you know it's an unfortunate situation in the retail trading industry. They end up just circling around at the beginning at the first level of unconscious incompetence. What does that really mean? It means that you just don't know what you don't know. And this is all because of the misinformation and retail brokers and charlatan trading educators. People end up just circling around with unconscious incompetence and they never actually get to the next level which is conscious incompetence. So that's for example like sitting at a trading desk literally next to a professional trader and them showing you what they actually

44:42 do at the professional level and then people realize you know even when they come to an ITPM seminar and we show them that like we were at an investment bank or a hedge fund and you came and sat next to us we show them that and people become conscious of what they don't know and they say oh my god how have I been so stupid to lose five ten$25,000 by learning all of this nonsense that doesn't actually make me money in financial markets. Then you go to the next level which is uh conscious competence which means you're actually doing it for real in the markets and applying that information and making money. Then you go on autopilot. So it's kind of like driving a car and not thinking about it. It becomes

45:27 unconscious competence. It becomes part of you. It becomes second nature and you just make money on autopilot. So people end up really in the retail trading infrastructure just circling at the beginning it with unconscious incompetence. And I think if you just take that template of the four stages of learning and apply it to the retail trading infrastructure, you you'll be already winning and you'll be far ahead versus so many people because you'll just get to the next level where you realize, oh my god, this is the stuff I didn't know existed. Then you just have to learn it, apply it, make money and then turn it into an autopilot situation which takes quite a while. It can take a year, two years. But you know this is the way we do things at the institute and this is and we apply this template

46:14 to the retail trading infrastructure in order to change the way the industry works. So this is what we're trying to do here for example in Thailand you know with our with our mentoring programs and having direct access to professional level traders. Yeah. Downgrades to recommendations or earnings forecasts. Downgrades to what? >> So when you say downgrade, >> what are you talking? You know the downgrade to what? >> Your background. You have experience in trading? >> No, I do not. Okay. >> Uh I am a retail trader like everyone and basically punted and made money and lost money as well. And so uh but I have decided that uh to stop all that crap

47:00 and just come to the institute, learn to do it properly and then start again. >> So I just asked you then if you had experience of trading and you said no you have traded punted in your own words. >> Yeah. Punted. Exactly. >> To you do you not consider that as proper trading? >> No it's not proper trading. you realize um you do realize when you come here that uh it is a completely different world the world of professional traders and the world of retail traders and uh yeah so I'm really really uh happy that I came here because I'm learning the the to do it the right way. [laughter] it is more uh it is it is it's a process so it is very difficult at the beginning to find all the answers but obvious

47:46 uh but I'm still a long way away but I'm confident after the 3 months mentorship I'll be fine >> so how's the week been and uh where are we going >> uh so now we're after Anton's um we're just going to pitch a couple of ideas so we've got do two shorts and two long ideas from where we started is we're just completely different people. So, it's Yeah, it's it's it's great.

48:32 pretty impressive, eh? [laughter] >> They've had a couple of big contracts recently that was more to do with the civil parts. So, they've had two contracts in the last month which were 37 38 billion that from from what I've read in the 2018 report. Yeah. Contracts wise, obviously, it's pretty hard to look future wise of the contracts. They're usually over mainly they're usually 5-year contracts. >> I'm very happy with the work. We've got three positions on decent positions. Not like home run knock out the park positions, but it's a good start and uh the progress from the first session has been pretty outstanding. You're now basically I would consider just one rung below being able to uh process and verbalize at a professional

49:18 trading standard. Oh, >> I'm going to put that on. >> Well, like he says, always stay in motion. >> So, always be thinking about where things are and what can be done to maximize uh reward risk. >> They're basically growing rapidly is essentially what's going on here. uh that's their their core business is growing rapidly and that's being driven by a couple of trends that I identified like the thematic sort of situations. >> They're the little bit behind the eightball with the R&D because they're transferring to a new um architecture

50:04 for H hard disk drives. >> So that's the one you do because you don't have any wasted time premium when you compare your progress to the beginning of the week. Obviously, there's still some things we have to iron out in terms of quant numbers, arithmetic, attention to detail. It's far better out of 20 people. So, if you adjust it for the amount of people, it might not be the case that it's like we're walking away with the most ideas, but walking away with uh seven positions already on is a record capital committed. Now, if I just mentally add it up, we're looking at probably a quarter of a million already committed, which is pretty cool. Like there's

50:49 there's genuinely I would say 50% of this group could genuinely have proper portfolios now and we'd be able to trade them and probably make money. So, you should be proud of yourselves. It's been worth the trip. So, round of applause [applause] >> and time for a few drinks and a barbecue. >> Happy? >> Yes, very happy. I'll go to put the position on. >> [music] >> Cheers. Thanks. >> I've tried many different processes. Obviously, all of them no good. Um, technical analysis, you know, reading the annual reports, not really

51:34 understanding what I was seeing. And then when I put the trades on, not really believing what I was doing, which made me feel like I had to monitor the trades from minute to minute and it it h you just don't have confidence. You know, you put the trades on and you don't really believe that they're going to go in your direction. So, it's basically fumbling in the dark. This time with with the knowledge I've learned, I do feel there's more confidence in my ability to make the decision to buy something and be confident that that's the direction that the stock will go rather than thinking I I really don't know where it's going basically. >> Yeah. Yeah. I've traded some forex

52:21 stuff. It just went bad. Yeah. Basically, I've never made money. I didn't screw up, but it was just because my my positions were so so tiny. If I would have picked bigger positions, I would have blown up blown up. >> And so what is different now? >> I have a process behind that I can go through and that I can rely on every time. It's not just looking on the chart. I really have to dig deep and and really find something. It's not just a oh just have a quick look there and a look there and there and then the work is done now it's actually it's way more to do and to dig deeper and you can look for for some

53:07 problems. What have you missed in the process? Have you made some mistakes and then you can [music] refine it and build it. One sentence to sum it up. This is Dank. >> Dang. Thank you. So, Anton, uh, I've been talking to the other mentors throughout the week, both >> on camera and offline, >> and as ever, I'm struck by their

53:54 experience, their pedigree, the quality of the firms that they used to work at, the things that people say about them and so are the students. For them to have access to these guys is is great. Where did you find them and where did you find so many of them? >> Well, it's a good question. Um, finding these mentors is not easy. It's not one of those things where uh you can go on LinkedIn for example and have like a filtering process where you know you type in uh some requirements like professional trader for 10 years minimum uh made over a certain amount worked at all these institutions you can't do that we have to use our networks and we've done it Jason came on board first

54:40 followed by Raj then other guys came in and I had to genuinely go out hunting globally for these guys through our networks and uh they have to be over certain number of years, certain net worth and a certain standard uh in the professional trading world to just even be spoken to or considered. And it was a real massive challenge for us to find them. And really, it's no different to the challenge that retail traders have themselves because they have to find these guys themselves. Mhm. >> So we've gone out kind of done the work for the retail trader in bringing all of these professional traders under one roof and uh it it's really the same

55:26 challenge that [music] they have. >> So today's Saturday, it's the final day of the mentoring program. Uh I feel the students have come a long way. They started out knowing a little bit and they've come a long way and I'm really excited for their prospects going forward. Yeah, I'd say that this group more than any others has really u bonded and kind of expect them to keep in touch. [music] Uh I did have experience a little bit with the trading overall it wasn't profitable and um that's how I came across Anton. I was looking for the guide. I was looking for the mentor. [music] Um I found Anton I found the team. uh also we get [music] amazing

56:12 team between us as a mentees and I'm very looking forward to work with rush and uh continue with the mentorship and uh overall it was fantastic >> and we've all got different backgrounds but we all have this same shared interest everyone seems really driven we all turn up for breakfast doesn't matter who's there you just go sit down and you start your daily conversations and it's kind of all revolving around trade ideas generation what's happening It's a It's a good community. >> I've never seen anything like it where you can sit in a room with four mentors who've been there, done that, and they literally something they can make something that seems very complicated and can be very complicated and they [music] break it down so simply. It's

56:59 it's just great to watch everybody in action. So, yeah, [music] takes you away from the domestic daily routine. So you can actually really kind of focus on what what you're here for. It does take time. We spent I think the first day for our homework most people work 10 to 12 hours. Yeah. To have that clear [music] mind so you can focus on it really helps. And it helps having such an amazing view. >> I mean trading can be quite a lonely game. So, without a doubt, now [music] all 20 of us are just going to be staying in touch and uh just being one massive group together. So, uh yeah, it's going to be a going to be a fun future.

57:45 >> Oh, I absolutely think these guys have a good chance. They this group is focused. They worked hard and they've come a long way and I I really feel like these guys are going to be very profitable going forward. >> You know, meeting your mentor face to face. You know, one of the first things we do is obviously the confessional. How have you lost money? Tell me the whole story start to finish. They know that there's nothing else to hide. There's nothing left to talk about. There's only upside from them. [music]