How To Make A *Proper* Trade Review

Attached below are a couple of Nathan’s Playbooks/reviews for his trading days. This is the work required daily to become a successful and profitable trader.

Notice the evaluation of market structure this day, which sectors are strongest, and a complete breakdown of the most important trade of the day for Nathan. Feel free to reach out with any questions.

https://drive.google.com/file/d/1tC349C-dneXpRwcfOz7tTmNz007PyJvq/view?usp=sharing

https://drive.google.com/file/d/1IIht7gcy1Y7H90HWZAuU8W6_jszATzhe/view?usp=sharing

Options Trading For Beginners

First,  

When it comes to options trading, there is more risks and flexibility, and everyone should acknowledge that. Each one of you have to take responsibility for your trade and understand your limits. Greed is not good!

Stocks and Options are two different subjects. Owning stocks mean you own a piece of the company. Option is a contract between two parties (Buy or Sell). Option buyer has the right to buyor sell a fixed quantity of the underlying asset at fixed price, which called strike price “On or Before” option expiration date. If the selected contracts do not reach the price or head to the direction you want it to be, please evaluate your position and cut losses instead of holding it. By cutting losses, you will have the opportunity to re-enter another trade. In options, your contracts will expire in a fixed date, and if you don't reach the strike price before it expires, your broker will automatically sell your contracts before the market close on that day. Please do your own due diligence instead of following others’ options trading signals. 

The Undergraduate Trading Society at UCSD empower students to TRADE the financial markets instead of investing. Options is considered as “trading”. Warren Buffett, who is noted for value investing, holds the stocks and expect it will raise in a long term, which is considered as “Investing”. In my opinion, it is unrealistic to invest like Warren Buffett as a student since we don't have the capitals he has. Therefore, UTS promotes the idea of trading the financial markets instead of investing.

Terms you need to know before you start trading:

Strike Price: the fixed price is the price at which a call or put option can be exercised.

ITM: In The Money, which means “Intrinsic Value”. In the money is when the current stock price is higher than the strike price. 

ATM: At The Money is when the stock price is close or equal to the strike price. 

OTM: Out The Money is when the current stock price is lower that the strike price. 

Delta: measure the degree to which an options is exposed to shift in the price of the stock

Vega: measure the sensitivity of volatility of the underlying asset 

Theta: measure the rate in the value of an option decline due to time decay

Gamma: measure the rate of change in Delta

 

Good luck and happy trading!

Zhiyao Li

Vice President and Head Options Trader 

The Most Helpful Trading Content for New and Developing Traders

When I started trading back in April of 2018, it seemed nearly impossible to find information on how to start out as an intraday equities trader. There was so much information to learn but it was scattered out across the internet waiting to be found like some kind of hidden treasure. It took months of digging to find the most useful websites, blogs, and videos with the necessary content on how to become a consistently profitable trader.

There is an incredibly long learning curve with trading. When I first started trading I thought I was ready to go and able to beat the markets after only two months of studying and paper trading. I learned the hard way and it cost me. The number one issue I had was controlling my emotions and fear. I still deal with these issues today and am working diligently to try and combat these major issues. There is no emotion with paper trading. Please remember that. If you think you are ready to trade live, the hard truth is you probably are not. No matter what you do you, will fail at first. This is a fact and this is the truth. You will lose money, you will get emotional, and you will make stupid mistakes. However, with every mistake you make and loss you take the markets are giving you a chance to step back and learn from these mistakes.

Keeping a trading journal is the only way you can become a consistently profitable trader. This was my biggest mistake when I started trading live. I had no journal and no knowledge on the importance of keeping track of every trade you take. If you don’t track your trades how will you ever know the what you’re good at and what you’re bad at? How do you learn from your mistakes if you don’t know what you are making mistakes about?

If there is any one piece of knowledge you take away from the SETC, it is to KEEP A TRADING JOURNAL. Paper trading or live trading, just have a damn journal. I cannot stress how much I wish I had someone to tell me this before I started trading live. It will save you a lot of money and cut down on the inevitable learning curve.

But, before you can keep a trading journal you have to know how to trade. So for those of you who don’t know anything about day trading or the stock market, in this post I will attach the most useful information I’ve come across during my time as a trader. I recommend studying as much content I share here as possible because it’s the only way to learn the fundamentals of trading.

The most helpful youtube channels

  • Ricky Gutierrez - The first person I found when I began researching trading. I actually purchased his course and found it incredibly helpful. If you have absolutely no knowledge on trading he has tons of videos for beginners.

  • Warrior Trading- A great channel for beginners as well. Although I don’t trade the same style as Ross Cameron the founder of Warrior Trading, there are still plenty of useful videos for those just starting out and interested in momentum trading.

  • The Boiler Room- Awesome channel with tons of videos for beginners. They also run a free discord chat which I use as well. I recommend joining it as it allows you to talk with other traders and share ideas as well as feel less secluded if you’ve been trading alone.

  • Timothy Sykes- Those of you interested in penny stocks, this is your guy. I don’t focus on this style of trading too much but for those interested I highly recommend him.

  • Steven Dux- A student of Timothy Sykes. He has made millions trading pennies and shares great information.

  • Adam Khoo- Great channel for those interested in Forex.

  • Jason Graystone- Another great Forex trader with hundreds of useful videos.

  • Trading 212- Great channel for all types of trading.

  • True Trading Group- Great videos showing actual trades and the techniques used.

  • SMB Capital- a prop trading desk based in Manhattan producing hundreds of videos on how to become a consistently profitable trader. My number one recommendation for those of you have the basics down but need further skill development. I learned so much from these guys I am so grateful for the content they produce.

Best Websites

  • Stock Twits- The twitter of stocks. The website has trending stocks and thousands of professional traders sharing thoughts and ideas to the outside world. It can help you find stocks in play and give you a good laugh as you read the bulls and bears fighting in the comments.

  • Wall Street Journal, Bloomberg, CNBC- All of these are in my opinion the best news websites for trading and monitoring the markets for any big news catalyst. I don’t follow any of the TV hosts on CNBC or other finance cable news channels because in my opinion they manipulate stocks and will say anything to get the highest ratings. Always do your own due diligence before making a trade decision if you do believe in something said on TV.

  • Chat With Traders- By far the most valuable trading blog on the internet. There are hundreds of different podcasts where professional traders sit down with the host and talk about their trading careers and give advice to us new and developing traders. It is a must if you want to be real trader one day and I wish I learned of it sooner in my trading journey.

  • Investopidia- For any information regarding the markets, trading, or finance this is your new best friend. The name is all you need to get an idea of what this site is. The encyclopedia of investing.

  • Udemy- Cheap courses on literally everything. There are some great courses on stocks and trading which makes it a lot easier having all of the basic information on trading in one online course that you can learn at your own pace.

I hope any new traders out there find this information helpful. Please do not hesitate to contact myself or any other member of the organization.

Nathan Fagan

President and Head Equities Trader