Recently I sat down with Mari, my first female millionaire student for an interview.
This time the tables were turned as Mari interviewed me for her YouTube channel.
Mari is another great example of a student-turned-master who is giving back by teaching others.
Watch the video and take notes.
Also, make sure you like it and subscribe to Mari’s channel.
First up, here’s the interview…
Table of Contents
The Mistakes That Made Us Better Traders
The interview ended up being longer than Mari expected, so here’s part one..
The video is packed with lessons, but here are…
3 Mistakes That Made Me a Better Trader
One mistake I made early on (and I’ve seen a LOT of traders make) is…
You Can’t Fake It
Let’s say your account is growing in a hot market. But it’s only because of the hot market, not because of you.
And because you don’t have proper risk management, when the market changes you lose everything.
I managed to navigate the big shift when the dot-com bubble burst. But I still lost more money than necessary.
Why? Because I didn’t know how to cut losses quickly right away.
I was making money in a hot market and when it changed, suddenly I was losing money.
You can’t fake it because eventually the market will expose your strengths and weaknesses.
That mistake is also kinda beautiful because you find out a lot about yourself (but you have to get introspective and blunt about who you are).
Never Go All In, Even When You’re Confident
My first six-figure win was in college.* The company was ISCO International (formerly Illinois Superconductor). The stock was delisted from the AMEX in 2010 after years of financial struggles.
Here’s the chart from December 1999 to May 2000…
You can see the big gap up on the chart in March 2000.
The company announced it was going to be on TV over the weekend. So, I thought, “Okay, this is going to be a hype play.”
It was already up from $5 to $17 on the week. I bought roughly 10,000 shares.
That was about three-quarters of my net worth at the time. That was stupid (and I DON’T recommend it).
I thought I could make $10,000 or even $20,000. That would have been my biggest gain ever.
But instead, it gapped up to $27. I made six figures in one day as a college freshman.
Another mistake I made was due to pure naivety…
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Never Fall In Love With a Company
My best friend’s dad had a company called Cygnus eTransactions Group, Inc. It traded under the ticker CYGT.
I believed in the technology (I had restricted AND unrestricted stock).
I was so invested because Cygnus had deals with AOL, Expedia, Six Flags, Universal…
It was an amazing company, right? Unfortunately, falling in love with the technology didn’t save the company from failing.
And as the company was failing, the stock kept going lower but I couldn’t sell my shares because it was so illiquid.
Eventually, my best friend’s dad got thrown out. The new CEO, Stephen K. Brown looked at me over coffee (with a straight face) and said “Don’t worry, Tim. Your investment is fine.”
A few weeks later I found out he’d bought the company out of bankruptcy, changed the company name, and somehow kept all the contracts.
Later he sold it for $100 million.
I was right about the technology, but I didn’t anticipate such a sleazy CEO (I wasn’t cynical enough).
I lost roughly $1 million. It was a tough lesson.
You have to expect the worst out of every company and every management team.
But that mistake helped me develop the plan where I only trade liquid, volatile stocks.
The hilarious thing is that Page Six ran an article called “Party’s Over for Hedge King.”
I used that as fuel when I started teaching.
Apply for the Trading Challenge
All my millionaire students came through the Trading Challenge.
If you’re ready to join Mari and the other traders we talked about in the interview…
Apply for the Trading Challenge Now
Fair warning: not everyone gets in.
Why? Because my team is meticulous about keeping scammers and people who aren’t ready to work hard OUT of the Trading Challenge.
Since you read this far, I’m guessing YOU want it bad enough that you’re willing to work your butt off.
Apply today.
See you on the inside
Cheers,
– Tim Sykes
*Past performance is not indicative of future results
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