Episode 10 ... Tim Grittani (52:48)
Finance major at Marquette
Learned that he didn't like finance
Was into poker and sports betting in high school
Opened account with ShareBuilder(?)
Started randomly buying and selling 30 cent stocks
Lost half his account within a couple of weeks
Joined Tim Sykes' "Silver Package"
Blindly followed trade alerts from "gurus"
Had emotional trouble once money was on the line
Hiding his P&L helped him become less emotional
Went full time after six months of struggle, $1,300 in the hole
November 2011 (?) back to breakeven
Made a new mistake, learned something new every day for six months
Learned to focus on a couple main set-ups
OTC Pump and Dumps
Buying multi-week or 52-week breakouts
Frustrated with listed stocks because too many factors affecting stocks
OTC stocks trade in a world of their own
Learned to understand promotions run on OTC market
Promoters have email lists with thousands of people on them
Understood all the connected promoter websites, subscribed to all of them
Would try to act on emails he received as fast as possible, beat the crowd on the spike up
Would also buy breaks of daily highs on the pumped stock
Fine line with fraud regarding stock promotions
Learned liquidity all important
Began short selling promotions instead of buying them
OTC promotions would get halted and would re-open weeks later down dramatically
OTC market dead until marijuana stocks ran in 2014
Began short selling listed stocks in the same way he shorted OTC promotions
When he sees patterns forming, he knows what to do
His edge is his experience
Spends 15 minutes every night putting together the next day's watchlist
Lost $290,000 on a single trade, LAKE, 9.90 entry, October 2014 (chart below)
Refused to cut his losses when mis-timed his entries, would always look to add higher
Before LAKE, trades would always work out for him in the end, developed a bad habit
LAKE experience taught him to cut losses
You need the right broker for your trading strategy
SpeedTrader best to buy OTC promotions back then
Only trade liquid, volatile stocks
Identify and focus on your niche
Traded only two OTC set-ups (new promotions, breakouts), nothing else
Trade charts and price action only (not hype)
Everyone knows OTC stocks are garbage, but just as many listed stocks are also garbage
Never hold and hope
Cut losses intelligently, not necessarily quickly
Base stops on chart, not some preconceived dollar or percentage amount
Figure your size from your risk level ... dollar risk is constant
"Trade the ticker, not the company" -- a Nate Michaud saying
Couldn't live without a market scanner -- how he finds his plays
Top percent gainers with dollar volume requirements is his main scan
Hasn't read any trading books, but interested in trading psychology books most
Don't waste your time following trade alerts or mimicking trades
Just make your own trades, win or lose, figure things out on your own
Be mindful about volume and liquidity -- avoid thin stocks
Twitter: @KroyRunner89
