In this video, learn how a former part-time retail trader, who blew up his trading account, rebounded to become a prop firm. A firm trader shares his turnaround from blowing up his retail trading account to landing a seat on our trading desk.
View Video Transcriptin this video you’ll learn how a former
part-time retail trader
who blew up his trading account
rebounded to become a firm prop trader
hi i’m mike bella fury co-founder of smb
capital and we’re a proprietary trading
firm located in midtown manhattan
and i’m also the author of the trading
classic one good trade and the playbook
in this video a firm trader
shares his turnaround from blowing up
his retail trading account
to landing a seat on our trading desk
let’s get to work on sharing this
inspiring trading story
for the trading community so you can
grow your trading account
so scott appreciate you joining us again
and and sharing your thoughts with the
trading community can you please remind
us
about the last time that you presented
to the trading community and where
you’re at in your trading
yeah so the last time we talked mike we
had done a video
after you reached out to me when i had
taken a big hit
uh shorting codx
back when the kovid names were running
and
so we got together did a youtube video
and discussed how that played out and
lessons learned
etc and so since then
i’ve basically been kind of grinding
back
trading and just continuously learning
studying um that’s when i got into
smb dna let me just cut in a little bit
so i
you did a video and hopefully we’ll
we’ll link the video
uh here you video how a part-time
profitable trader
agonizingly blew up his trading account
so you never
do and you shared that experience with
us
which is not the easiest thing to do and
then you talked about
hey let me come up with some plans for a
comeback
and so since that time can you walk us
through
what you’ve done since then yeah so it
to me it’s just a continuous learning
process so
understanding how small cap momentum
names run
and uh which you know there’s times
where there’s small caps that run
several hundred percentage points and
you know if you’re shorting those too
early you can get really hurt and just
understanding how they operate which is
different than big cap names
was something really important that i
learned out of that
process and to me it’s just a
continuously learning trying to
understand
how other traders trade you know how to
be successful
in different areas of the market so
that’s kind of the main thing that i do
is continuously
watch videos or read uh
books and podcasts etc to try to learn
and become a better trader and you know
i’m still
a work in progress i mean i still have a
lot of things that i that i need to work
on
to this day and since that time
you’ve since earned a seat on the
trading desk and perhaps you can walk us
through
how you went from that past video to now
earning a seat on the desk
if you want to learn three more real
world setups that our traders use
including the simple setup that we teach
all of our new traders
and the setup that turned one of our
traders into a seven figure
big money earner check out the free
webinar that we’re currently running
just go ahead and click the link that
should be appearing now
at the top right hand corner of your
screen that will open up the free
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don’t worry
you won’t lose this video you can also
visit
tradingworkshop.com to register for this
free intensive workshop
you’re going to learn more in a couple
of hours from this trading workshop
than from years of online education yeah
so as part of that learning process
one of the things i did was sign up for
the smb dna
program to learn you know what
professional traders do
and part and then so once i completed
the s b dna
i got an email for the winning trader
which is a more detailed
program to help you become a better
trader
and so i took both those programs just
just to learn and understand
more things about trading that i didn’t
understand at that time in my trading
career and then as a follow-on to that
there was an offer that sent out via
email to participate in a
equity tryout program for the firm
in which you trade a demo account for
several months and if you do well enough
then they offer you a remote trader
position
and that sounded like something that i
was interested in
and so i went through that process and
completed that
and emailed the firm and and kind of
went through the process and i was
offered a remote trader position and so
i’m still
i’m traded this is my beginning of the
third month
trading for the firm a live account okay
and that’s a little that’s unusual so
most of the traders who we hire at the
firm
intern with us when they’re in college
and then they stand out and the best
interns are
offered a spot on the desk after they
graduate from college but
you know one of the things we’ve done at
the firm is created a
education arm called smb training and
one of the
positives and benefits of sme training
is there can be a path
for the most serious the most dedicated
of students the most diligent of
students
to interview and
gain a seat on the desk and get their
hands on firm capital
and firm resources and firm technology
and so you are an example of somebody
who
i i i guess there’s a front way there’s
a front door
into the firm and then there’s a back
door into the firm
or there’s another way into the firm or
there’s another way through the front
door and
it seems like you came through the smb
training
arm to to get into the firm is is that
accurate
yes yes it is how long did that entire
process take you
i think it was about a year when i
started the smb dna to when i actually
got hired all right great and so
you you now trade at the firm and you’re
trading remotely
yeah i live in the panhandle of florida
a town called crestview
and i actually haven’t i want to make it
up to new york and
sometime in the near future to kind of
meet everybody because it is it’s it’s
different when you’re
just kind of isolated and not
uh not be able to see the other traders
at the firm so i definitely kind of miss
that community aspect i would like to
connect um in person with
some of the firm traders all right great
so
you know you blew up an account that
obviously didn’t feel very good you
shared that with the community you
started to
to take some actions to
come back and and and have another
chance
i’m wondering what helped you the most
from
blow up to
being successful with your comeback or
at least being successful to
to get to the place where now you’re
trading on the desk
yeah i mean i think the main thing is
just respecting the market
and in the market action um i i still to
this day
struggle and i just kind of want to
um kind of tangent off yesterday we had
i believe his name was
um gleb who
[Music]
trades on team shark and he did
kind of a i think it’s these guys
are good yesterday afternoon and
something that he said
really resonated with me he said that
when he started out
he was kind of putting on a lot of size
when he probably shouldn’t have been in
less uh
you know less than a plus setups and
and so his his thing was just going too
big
and and kind of maybe impulse trading
where other people on the spectrum have
a
problem putting on size and scaling up
and i believe i fall on the same
spectrum he does in a sense that it’s
it’s one of my
things that i’m constantly dealing with
is just putting on
a lot of size and
but when you do that you know if it goes
against you a little bit you can hit
your daily stop
or exceed it so it’s something that i’m
doing right now because
it i’ve had some i’ve been profitable
my first two months at the firm but i’ve
also had some days
where i’ve exceeded my daily loss and
i want to fix that issue but it
it’s it’s i just know it’s a tendency of
mine that i’ve got to work on
is to kind of scale back and kind of
rain myself in
unless there’s really good setups but
i think that’s the main thing is
respecting market action
and just trying to be disciplined to
hold off until the best setups are there
and that’s not always easy because
you know you want to come in and trade
because
you want to make money but if the trades
aren’t there
it’s best to step aside or just really
scale back
so that’s something that i’m continuing
to work on
to this day i’m not sure you’re supposed
to tell me that you went over your
stop-loss
yeah i wanted to be transparent so
but we have a risk manager that that
watches that
minute by been on my minute-by-minute
trader by trader
and so when traders
start to come near their number and when
traders
start to struggle with that then there’s
a risk manager at the firm
that really does work with the trader
the job of the risk manager is to help
you it’s it’s to help you
to stay within your loss limits it’s to
help you not lose too much
on the days when you’re not seeing the
screens well when you’re just on the
wrong side of trades
and you know just get you to cut it off
and
take some small losses and and maybe
even just say hey this day beat me
but then there’s a lot of other days in
the
month where you know some of those days
you’re going to be seeing the markets
really well you’re going to be be seeing
the screens really well
and we want to keep a lot more of those
profits
by making sure we don’t lose too much on
the days where we’re just sort of
not trading that well and i know you
play a lot of basketball
but there’s times i mean if you play
every day during a month or six or five
days a week
during a month there’s going to be some
days you go out there and you just
can’t make a basket you just can’t make
a basket
and it’s not that you just didn’t
practice well
or you stayed up too late at night or
you did something wrong it’s just
that’s that’s a part of being an athlete
you’re just off certain games
and when you’re a trader the same is
true there’s just going to be days where
for whatever reason you get an idea in
your head
and it’s just not the right idea or
you’re just pushing the buttons
you’re executing just at the wrong spot
you don’t have a good feel for the
rhythm of the stock
and you’re just off and you want to make
sure that
those days don’t impact your entire
month
too much yeah absolutely i mean
that’s one of the things that is really
great about
trading for a firm is having the risk
management in place
um because there are days
where you’re just completely off and
there’s days when you’re
you’re completely on and if you’re off
it’s
even if the setups are there you’re just
not seeing things right or your mental
state is off
and you do need to step aside
and you know come back another day
and when you’re in a better mindset
mindset’s huge
yeah and it’s interesting you mentioned
gleb
because super ambitious traitor and and
i remember
him wanting to start really fast and be
at the top of the firm’s leaderboard
perhaps uh sooner than
is possible and and that’s a part of
what we have to do here is get guys to
throttle back
get them to focus on building a really
strong foundation get them to focus on
building their playbook
build a trader that is scalable build a
consistently profitable trader who
controls their risk really well
and then from there we can
we can add a lot more risk to that
trader i’m just curious
and you you’ll refresh our memory here
you blew up i think you talked about
this because you were too big
in a stock that you thought certainly
ought to trade lower and just wasn’t
well i think the main thing was yes i
was way too big
in shorting covet names when kovit was
just starting to ramp up and
in my mind i didn’t think kobit was
going to be a thing and it ended up
being a really big thing
and every you know every mask related
stock
and covet related name just had massive
moves so
i had way too much size and
just wasn’t reading the market correctly
and in that situation
you know you see it a lot of times on
twitter
etc where where people it happens to
people
especially in the small cap names
because
they can have such enormous moves
so it’s even i would say more critical
if you’re
shorting a small cap to control your
risk
and not oversize in those names because
they are so volatile
so i’m sure there’s plenty of people in
the trading community who are going to
watch this
who are retail independent traders who
have also blown up
or are losing too much on on their bad
days
i wonder as somebody who’s actually been
through that
whether or not you had some advice for
those
for those traders yeah i mean i think
you have to understand
like who you are as a trader and
in my case like i want to put on size
like i just want to put on size
and there’s times where it’s not right
there’s times where you’re too early or
your thesis is right but you know
[Music]
it’s not going to play out until
tomorrow or the next day
so you know try to
just be patient and and wait
until the price action confirms your
thesis
and and don’t fight the market um
that’s that’s really the main thing is
like you don’t have to believe that it’s
it makes sense but if you if you fight
it you’re gonna get hurt
especially if there’s like huge momentum
there so
i would say just be patient and
understand where you have weaknesses
and and work on those i don’t think you
can really
you know fully change how you are as a
as a trader
but there’s things that you can work on
to get better at those those areas of
weaknesses whether it’s
being afraid to put on size or having a
tendency to put on
too much size when the time is just not
right
you said you need to put on size have
you ever thought about
why you do i think from my perspective
because
i want to transition into a full-time
trader
that i look at what i make
at my engineering job and how much i
need to make to replace that income
through trading so i have this
let me try to make this much money
per day per month and so i end up
you know if i only have this many you
know
a couple hundred shares or whatever and
it
does move then i’m not going to make
anything
or so i think that’s probably the the
driver
in my current situation is
like you mentioned earlier trying to get
too big too fast
i’m curious how would you describe
yourself as a basketball player
and i promise there’s a reason i ask
well my son is a very good basketball
player because he trains all the time
but
me i’m really not that great of a
basketball player
i can shoot pretty good but
as far as the other aspects of ball
handling etc
my but my son has a private coach and a
trainer who
who trains him so he’s he’s practicing
multiple times a week
and plays in tournaments etc um well
when you were playing a lot how would
you describe yourself as a
as a basketball player committed like i
just
would keep going i guess grit like i
think grit’s important so
well bill bradley uh wrote in his book
that you can tell
more about somebody watching play
basketball
in a short period of time and you then
you can knowing them for
long periods of time that that how you
play basketball really
says a great deal about yourself i don’t
know if you’ve ever
heard that saying or heard that so what
mike i’m curious what is it about
basketball versus i guess other sports
is
it well what is about basketball i do
think there is something
uh different about basketball than there
are other sports because
it’s a team sport and
there’s definitive winners and losers
quickly particularly in pickup
basketball i mean
you really can tell a lot about a person
if you go watch them play pickup
basketball
you can tell a lot about truly the type
of person they are
their temperament
their feel for fairness
whether or not they share the ball well
whether or not they play hard on defense
whether or not uh they
call fouls uh
fairly or whether or not they over argue
on certain calls and
and one of the things that dr
steenberger
has asked us to do as traders is think
about
what are the things you’ve been
successful at in the past and why
that was you know what are your
strengths why i’ve been successful
and why is that and then start to think
about
building a a trading career
based off of your strengths which
should be consistent with your unique
talents
so you know for instance
uh if if you are and a basketball is a
good example of this like there are
certain basketball players who take a
lot of chances
there are certain basketball players who
you know only take
the open shot when it’s a really really
good shot
there are certain players who are just
really unselfish
there are certain players who were
gritty so it kind of
it doesn’t really surprise me that you
found a way to keep working at this as a
trader
after having blown up and
you describe yourself that way as a
basketball player that that seems to
make sense to me and so
i was just curious about that because
yeah i mean i think i think we do at a
minimum and maybe it’s not basketball
for you maybe it’s
engineering uh maybe it’s something else
you’re particularly good at
but i do think you need to think about
hey why i’ve been why have i been
successful in the past
uh what i’ve what i have what have i
been good at
why was that and then like let me think
about that
with my trading now let me think about
so if i’m a particularly diligent person
and i’m a i’m a deep thinker
and you aren’t reading the research
reports before the open
for particular technical setups that
doesn’t make sense to me
you should be doing that you’re not
tapping into your strengths
if you’re somebody who’s just a really
quick thinker like steve spencer
who is my partner is the fastest thinker
of anyone
that i know he can give you an answer
immediately
he’s a really good short-term trader
you know we have we have guys here who
if you ask them a question
it will take them 30 seconds to think
and
three minutes to answer no matter what
the question is
those are guys who are going to be
diving deep into research
and creating uh different ways to trade
than hitting the buttons fast and
trading in and out and and they have
they want to tap into their super
diligence
and so that that matters and i think a
lot of traders
trade a particular style because they
know somebody
who makes a lot of money i know somebody
who makes a lot of money doing xyz i
know shark
likes to fade a lot of the flow floats
he likes to take on a lot of risk
i see him make as much money if not more
than anybody at the firm
i must go follow him when he goes to the
bathroom i’m going to follow him when he
goes to lunch i’m going to follow him
i can see his executions in real time
i’m going to
unravel them and i’m going to try and do
what he does
and you know some people can but but
maybe a lot of people
can’t because they can’t take the risk
that he does they’re they’re just
they’re more conservative they
they can’t draw down 250 000
before the stock’s going to turn and
make back a million and a half they just
can’t do it
it’s not it’s not consistent
with uh their personalities and their
abilities to
to to take uh to take risk
and then you know there are other people
who are just really fast thinkers who
are trying to do this in-depth analysis
of stocks that’s not what their strength
is
they’re not particularly talented in
being overly analytical
they’re good at thinking quickly and so
and what i always find funny about steve
who you know went to
the best business school in the country
undergrad
is or one of them i’ll let other people
debate that
is that when he trades
he and he reads a ton of stuff all the
time
if you ask him about quite about about
companies he knows
you know as much as anybody but but he
doesn’t trade that way
he trades quickly because
that’s just the way he thinks so anyway
you got me on to
you got me thinking about that and so i
thought i’d explore with you i think
that’s
no it’s really great i mean i’ve learned
about myself is like
i have a tough time kind of dealing with
intraday fluctuations versus kind of
seeing bigger moves
and so my mind is more along
what what is the bigger move i’m seeing
coming and
the intraday stuff really
kind of whipsaws and you know i don’t
see those
intraday movements as clean as i do kind
of bigger bigger picture movements
and so sometimes i’ll put on positions
an intraday that go against me and then
it’ll reverse and go up
because my i have a pretty good
thesis that’s going forward but
sometimes i’ll put them on a little bit
early
and so it’s just understanding like i
i would i couldn’t be a really good
scalper i guess is what i’m saying like
that’s just not my trading style
and just understanding who you are as a
trader
is really important you know i’m sure
you’ve tried different styles
as a trader up to this point is that
fair
yeah yeah and i think there’s elements
i think there’s elements of you know
shorting small caps and longing big caps
i mean
you can i mean all that can be part of
your toolbox
but i think there’s also
like things like there’s trades that may
work but they you know
might be so much frustration do you
really want to deal with that do you
really want to
you know deal with that type of trading
it might not be in your personality
it might be harder for you to execute
and kind of
affect your mental state because your
emotional and mental
capital is very important when it comes
to trading as well you know i think
sometimes traders think
let me just go find one person one trade
one style
and that is and
if i’m not good at that then that means
i can’t be a good trader
and i can tell you here we expose our
guys to lots of different ways people
trade and i can tell you out here
that there are people who make money in
a lot of different ways
they all learn they they come in and
they’re they’re taught
a strong foundation and they’re exposed
to different specific setups
that work but then we ask them to
gravitate towards their niche
and join a team that trades that niche
and then even when they’re on that team
they’re building from that
they’re learning things that are new and
so i’m sure
you have learned from some pretty good
people in the past
who do make money and who are
real traders but for whom
but for whose style wouldn’t work for
you is that fair
yeah that’s right yeah
and i mean maybe some elements of their
style do work
but i think it’s also important to
kind of come up with your own trade
ideas and what you’re looking for
because that’s really how you learn
because if you just
you know people talk about all the time
about following people into trades and
that doesn’t work and
seems like it should work right but it
really doesn’t because
you have to know why you’re getting in
and why you’re getting out
and whether you win or lose that’s a
learning
process that you develop so
[Music]
it’s it’s important to develop the
ability to kind of independently
look at charts look at setups and kind
of come to your own conclusions
and whether it’s right or wrong you’re
going to learn from it
but that’s how you get better you are
tapping into some of the resources at
the firm and you are definitely an
unusual case
so you are not the typical firm trader
by any means you came in differently
than most and
you know you are working right now you
earned the right to
be given a shot and you know now you’re
trying to figure out hey how to make
this
a full-time gig so you know you’re not
fully uh you’re not fully
uh integrated into the firm
you know you’re not on a team yet you’re
not
trading full-time which is super unusual
but you earn the right to be given a
chance
um and so i think those are
you know just speaking realistic to you
you’ve done a nice job
going from hey i blew up and i want to
start a comeback plan
and being persistent and showing grit
to get yourself an opportunity here
and now you sort of have to get to the
point where
you can do this full time and and use
all the resources at the firm i mean
you’re using the capital
using the technology you’re using the
risk manager
you’re using some of
getting to know the traders and seeing
what
what they do so gleb came in and and
talked to
to some of the guys who you you get to
see that and
and see how he’s doing um
but but you’re still not it’s like using
all of the firm resources um
so i think that’s you know that’s going
to be a challenge which is
if you’re not doing this full time and
you’re not fully integrated
you got to find you got to come up with
a plan
that’s going to work based on the time
that you have
and the opportunity that you have and
that plan is going to be different
than other traders who get to sit in
front of screens all day long and talk
to traders all day long
and are integrated into a team and
talk to guys like dr steenberger and
myself when whenever they
whenever they need to so that’s gonna
that’s gonna be your challenge and it’s
gonna be a little bit of a hurdle that
you’re gonna probably have to overcome
but you’ve overcome lots of others yeah
thanks for that mike
um one thing i did want to
just kind of pick your brain with was as
far as reaching out to people like
shark or gleb is it appropriate to just
email them to google
message them on any questions we have
100 shark always says just reach out to
me
and so uh if you if you need his email
address
i will give it to you don’t give it up
to anybody else
but uh and if gleb same thing i’m sure
gleb
be happy to talk to you and some of the
other guys but you know
it’s not only the best traders at the
firm
who people learn from there are there
are people here
there are senior traders that learn from
junior traders
there are junior traders that learn from
senior traders there are junior traders
who learn from junior traders
there are senior traders who learn from
interns there are junior traders who
learn from interns or interns that learn
there’s there’s a lot of cross-learning
that goes on
and you know in fact
one of the biggest success stories that
we’ve had at the firm
and certainly the best overall team that
we have
cross learns uh between traders and so
there’s a senior trader who’s taught a
lot
taught a ton to junior guys taught a ton
taught him how to
really measure their trades and
really execute properly
how to really execute much better so
that
doing the same things goes from a little
bit of edge to a lot of edge
and then those junior guys have their
own
trading systems that they are they had
their own trades
that really worked for them and then
started working for them better
because they got help from the senior
trader and then those junior traders
shared
the strategies with that senior trader
and then these guys started opening up
joint accounts
for lots of other things
and so the senior traders making more
because he’s got new strategies
the junior traders are making more
because they’ve got better execution
strategies
and they get to team with the senior
trader on
different types of setups where they’re
trading together
and so yeah i mean it’s it’s always good
to reach out to the guys who have been
successful
i mean the biggest thing with that is
well certainly you know what he does
works
the question is will it work for you but
there’s
and don’t always look for you know i
wrote about this in one good trade
i distinctly remember the scene when we
first started
smb capital there was a guy we brought
on who was up and down
and he had one of the great weeks that
you’re ever gonna have
as a prop trader relative to his ability
i mean he just was on fire
and and this guy was relatively unknown
before this week he has this on fire
week
people can see his p l he’s lighting it
up
you know by the end of the week
everybody at the firm is over at this
guy’s desk
uh asking him what he’s doing and
it turned out that guy never really made
it never sustained as a trader
and so uh you know but
you can learn a lot from even the
interns here the interns
the interns here are super bright
they’re even teaching the big guys
so yeah we’ll introduce you to those
guys but
there’s a lot of learning that gets done
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