Chat With Traders | Weekly interviews with profita

Chat With Traders | Weekly interviews with profita

Norway

If I was to say trading is a tough game to win, would you agree with me? Well I understand first hand exactly how tough it can be. And I also understand that if you truly want to master anything in life you need to absorb many powerful lessons from the greats. Through the Chat With Traders podcast I am making it my mission to give you direct access to these hard-hitting lessons. I am on a journey to becoming a super-trader and I want you to come with me, so subscribe now and never miss another episode. All show notes, resources, and links can be found at: chatwithtraders.com || Follow me on Twitter: @chatwithtraders

Episodes

117: Larry Alintoff – Traders' opportunity—when things that "should" happen, don't happen  

Larry Alintoff was a prop trader for Paul Tudor Jones, before running the largest group of traders on the AMEX (at the time). When he later went over to the NYBOT, Larry became the largest trader in the Frozen Concentrated Orange Juice pit, and now days, he’s CIO of The Toro Fund.

During this episode, we cover; the thing which helped Larry to become consistent, why there’s great opportunity in knowing when things that “should” happen, don’t happen, and how he’s been able to successfully apply a similar trading style from the floor to the screens. Plus, how a market obsession has carried him this far…

116: Sean Hendelman – Taking losses, ultimately winning, and keeping pace with markets  

Sean Hendelman is the co-founder and CEO of T3 Companies.

T3 is one of the larger proprietary trading firms in the U.S. And incase you’re curious, the three T’s of T3 stand for; trading, training and technology.

A few of the things Sean and I spoke about, include; how he got his start, how he lost all his money twice—and why it was a worthwhile experience (in hindsight), and some of the great lessons he’s learned from the business of trading.

Even as CEO today, Sean is still very hands on with T3’s automated trading, so we also had an interesting conversation around this—some of his comments and views may actually surprise you. And hand traders, need not feel neglected, because there’s something in this for you to!

115: Adam Grimes – What hand traders can learn from system traders, and vice versa  

Adam Grimes has been a trader for more than 20-years, he’s traded all major asset classes, across various timeframes. He’s traded independently, with a prop firm, and he’s run other trading businesses also.

The main focus of this episode is to explore some of the things which discretionary traders can adapt from quantitative traders, and vice versa—meaning, what things can quants take from those who rely on discretion.

Then in the later part of this episode, Adam lays out a solid framework which can help struggling traders to move forward. As well as, the types of questions you should ask when you don’t know what you don’t know.

114: Brannigan Barrett – The process of becoming a bigger (and better) trader  

Brannigan Barrett is a futures day trader—who trades a total of eight markets, across; bonds, equity indices, currencies and commodities. He was previously a trader at prop firm, Futex, but is now part of Axia Futures.

The subjects we cover during this conversation, include; how to progressively become a bigger (and better) trader, how a “dogfight” attitude has helped Brannigan’s trading career, how he prepares going into major news announcements, his daily process for journaling and being ready for “one good trade.” Plus, how to think about and achieve your trading goals.

113: Benjamin Small – Normalizing Bitcoin, and exploring the cryptocurrency ecosystem  

Benjamin Small is an electrical engineering PhD. He’s worked in quantitative research roles since 2006, at UBS, Citadel, Credit Suisse and the stock exchange, IEX.

Today though, Ben is head of market structure at Gemini—the world’s first fully licensed and fully regulated Bitcoin exchange, which is based in New York.

During this chat, we get into; payment for order flow and high frequency trading, why there’s an incentive to normalize Bitcoin, the cryptocurrency ecosystem, potential outcomes for the future of Bitcoin, and becoming a cashless society.

112: Jorge Soltero – Reminiscences of a trader at Hull Trading Co.—and a sell-side career  

Jorge Soltero began as a floor trader in Chicago, where he was an options market maker. A few years into his career, he landed a position at Hull Trading Company (the renowned firm of legendary trader, Blair Hull).

After Hull Trading was bought by Goldman Sachs in 1999, Jorge became more of an institutional trader—not only working at Goldman, but later, UBS and Merrill Lynch too, where he specialized in options and ETFs.

Listening to this episode you’re going to hear about; the culture of trading pits, exactly what it was like to be a trader at Hull Trading Co., the transition to electronic trading, what makes ETFs an attractive product, and more…

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111: David Bush – Strategy objectives, statistical significance, and market behavior  

Returning to Chat With Traders for a second time is David Bush—first on episode 23.

David began as a discretionary trader, more than 20-years ago, but over time he’s developed into a quant trader. And he’s exceptionally good at what he does; David’s been the first place winner of two (real money) trading competitions in recent years.

Last time David was on we spoke fairly extensively about his path as a trader and a high-level overview of his process. This time around we covered plenty of new ground—exploring David’s process in greater depth. Also, I particularly liked David’s comments towards the end about, “Intensity, not time.”

110: George (@RollyTrader) – Learning to trade, momentum setups, and becoming a venture capitalist  

On this episode, I’m joined by George—who goes by @RollyTrader on Twitter.

George is an Australian equities trader, with a momentum/swing trading type of approach. In the past, George has held a few finance-related positions, but since late-2009 he’s mostly traded independently.

During the interview, George and I got speaking about; lessons he learned early on, the effect that coaching and mentoring has had on his trading, specifics about the setups George trades, and also, his involvement with venture capital.

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109: Edward Thorp – The man who beat the dealer, and later, beat the market  

I’m not sure how to best say this, but Edward Thorp, is kind of a big deal…

Not only in the world of financial markets, but he’s also a household name amongst the gambling scene. He’s the man who beat the dealer, and later, beat the market.

It was during the late-50’s and early-60’s, when Ed, a math genius and professor at MIT, took on the challenge of discovering a way to get an edge playing gambling games such as blackjack, roulette and baccarat. Long story short; Ed won—and he’s now considered the father of card counting.

From there, the next obvious move for Ed was to take on financial markets—which he also did with a great degree of success. His first hedge fund, Princeton Newport Partners, achieved an annualized return of 19.1% (before fees) over a 19-year period, with 227 of 230 months being profitable—the worst monthly loss being less than 1%.

Ed’s most recent book, A Man For All Markets, is now available on Amazon.

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Q6: Delaney Mackenzie – Your Quantitative Trading Questions Answered  

Throughout this series, which has been a window into the workflow of professional quant trading firms, we’ve encouraged you to submit questions and requests for further clarification. So, in this episode, being the final installment, Delaney answers as many of these questions as possible (within 80-mins).

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108: John Netto – Being a versatile and adaptable trader, while testing your comfort zone  

John Netto, a former U.S. marine, describes himself as a high velocity, cross-asset class trader. He connects the ability to be versatile, adaptable, and interpret large amounts of information to be his greatest edge—for making lucrative returns.

These are all things we cover during the interview, which includes discussion about; process, research, strategy, macro, and market regimes. We also talk about the benefits of stepping outside of your comfort zone, why there’s a need to embrace growing pains, and when emotion can be an ally.

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107: Anthony Saliba – A 40-year trading career fueled by necessity—the mother of invention  

For the great, Anthony Saliba, his initial 13-years in the field were spent as a market maker on the CBOE floor, where he made approximately $9,000,000 before 30 years old (and that was during the 80’s). At which point, he was one of the traders featured in Jack Schwager’s first Market Wizards’ book.

Since then, Anthony’s continued to scale up—making major moves, both, through trading and through various business ventures.

We spoke for close to two hours; about his experience on the floor, a trader education company which he founded, some of the non-cliché traits of great traders, longevity, and how he’s grown wealth as a parallel entrepreneur, amongst other topics.

Anthony has also authored a new book for options traders; Managing Expectations.

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106: Turney Duff – A Wall Street trader’s tale of spectacular excess  

Turney Duff was a hedge fund trader on Wall Street who lead a truly excessive lifestyle. In 2013 he released a book about his experiences—titled, The Buy Side. And currently, Turney is a consultant on the Showtime TV series, Billions.

On this episode we cover everything, from what it was like to trade more than one billion dollars at Galleon Group—which was the hedge fund run by Raj Rajaratnam, currently serving an 11-year prison sentence for partaking in one of the largest insider trading rings in U.S. history.

Following on from this, we discuss Turney’s relationships with the sell-side and the extreme measures they’d take to win his business. Which leads into the shenanigans which took place after-hours—the cocktail of drugs, alcohol, sex, money and power.

We finish up with Turney’s fall from the top, some of the greatest realizations he’s come to, and the life he leads today… Enjoy!

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105: Brendan Poots – How a former punter pioneered a premier sports betting hedge fund  

Brendan Poots is the founder of sports betting hedge fund, The Priomha Group, who mainly bet on football, cricket, golf and also horse racing and tennis.

Priomha setup shop in Melbourne (Australia) in 2010, and more recently, have expanded with a second location in Gibraltar (Europe). From inception up to the release of this episode, Priomha’s Cloney fund has returned a little over 220%.

From listening to our discussion, you’ll gain great insight to how Brendan runs his operation—from getting investors to buy in, to controlling risk and minimizing the volatility of returns, and how the fund makes money trading sports games.

104: Alex (@AT09_Trader) – An appetite for risk, and hitting hard when opportunity arises  

Alex (@AT09_Trader) is a 22-year old, discretionary day trader, who’s seen great results in the few years he’s been grinding away at this. He trades small caps, and he trades aggressively—as you’ll soon hear, Alex is far from conservative.

This conversation was recorded on the 16th of November (2016), right around the time when the madness in the shipping sector was unfolding. So we got talking about the ticker DRYS and how Alex racked up a $40k loss a day or two before our interview (although, he had his first +$100k day shortly after too).

Also we spoke about how Alex got started, the types of trade scenarios that he looks for, areas that he’s working on to improve, and also his venture into real estate—where he flipped a foreclosure property for a tidy profit, plus much more.

Note: Nothing you hear on this podcast is financial advice. You’re entirely responsible for your own trading decisions.

Q5: Max Margenot – Good (and Not So Good) Uses of Machine Learning in Finance  

Machine learning is a hot topic right now, with a lot of people wondering how it could be used in finance and trading. Used naively, machine learning poses a great deal of risk. We’ll discuss why that’s the case and also some good ways to use it carefully.

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103: Dave Bergstrom – Escaping randomness, and turning to data for an edge  

On this episode, I’m joined by a quant trader who works at a high frequency trading firm—though you might be surprised to hear, he started out on the same path that many retail traders do—his name is; Dave Bergstrom.

The thing that makes Dave unique from most traders who’ve been on this podcast previously, is how he uses data-mining techniques to develop trading strategies. Though data-mining, in trading, often has a negative connotation attached to it, Dave believes this stems from bad practices and poor evaluation of methods.

In addition to the above and ways to reduce curve-fitting, we talk about escaping randomness, learning to write code, Dave’s three laws for strategy development, setting expectations and plenty more.

Q+A: Got a question for Dave? Write in the comments area at chatwithtraders.com/103.

Q4: Scott Sanderson – Portfolio Optimization: Risk Preferences In, Trades Out  

When one has a price model that they think will work well for forecasting returns, the next step is to actually trade it. This isn’t that simple for a variety of reasons. For one thing, you need to define how much risk you’re okay with taking on in a portfolio, and then try to maximize your returns while staying within those boundaries. This is the foundation of modern portfolio theory—we’ll discuss some real life issues with this.

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102: Eugene Soltes – Unraveling a $65-billion Ponzi scheme and notorious cases of insider trading  

Eugene Soltes is an author and finance professor at Harvard Business School.

Over the past eight years, give or take, he’s spent a lot of time with many big-time executives and professionals who have been convicted of major financial crimes, such as; cooking the books, fraud, Ponzi schemes, and insider trading.

What initially began as nothing other than self-interest has materialized into a 464-page hardcover book, which was released in October this year (2016). The book is titled, Why They Do It: Inside the Mind of the White-Collar Criminal.

Intrigued by the subject matter, I invited Eugene onto the podcast and we got talking about; how Bernie Madoff became the mastermind behind the biggest fraudulent scheme in US history—sucking billions of dollars from unsuspecting investors, some of the notorious insider trading cases, and ultimately, why they do it.

Q3: Jonathan Larkin – Seeking Alpha? Try MORE Alpha Factors  

In practice, no one trading model will ever be that good on its own. Luckily statistics has come up with a lot of theory about how you can combine weaker models to create better overall predictions. We’ll discuss how to combine many different trading signals into overall models and some of the practical considerations in doing so.

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