Episode 29: Triforce Trader
On the Steady Trade Podcast, we strive to educate you on ways to attain and maintain a long-term career as a trader. As part of that mission, we occasionally like to share interviews with successful traders to inspire you on your journey.
Today, Tim and Stephen interview Matthew Owens, AKA Triforce Trader, who has taken a different approach to trading. As Tim puts it, Matt’s approach is very “macro”; he employs algorithms and statistics and has found great success as a trader.
The tale of Triforce
Matt caught the trading bug at age 15 when his school had a stock market competition. He threw all of his money into Apple, which doubled in the next year. Not only did he win the competition, but he was hooked on the stock market.
Then, one day, he happened upon a book at the library called Don’t Sell Stocks on Monday. This book offered some fascinating insight on seasonal tendencies and probabilities in the market. It opened Matt’s mind to an idea: could the market be beaten?
In college, he began to teach himself programming, which only increased his statistical and algorithm-driven mindset. When he was 23, his mother sadly passed away; an inheritance she left him allowed him to begin trading in earnest, using the strategies and skills he’d discovered over the years. Since then, he has found his niche in futures trading.
Nope: Matt doesn’t deal in penny stocks. He primarily works with futures trading. In a nutshell, futures are based on financial contracts between a buyer and seller to exchange an asset (such as a commodity) at a future date and price. These contracts detail the quantity of the asset and are standardized to adhere to futures exchanges.
Each contract has its own value, like a stock, and it moves with the commodity prices. It allows access to a wide variety of markets; with futures, you might be trading grains, oil, gold, or a variety of other things.
Penny stocks versus futures
Tim, Stephen, and Matt discuss trading futures versus penny stocks. As Matt puts it, penny stocks are not for him; he’s not a “hunter,” which is a trait he sees as being inherent in trading penny stocks. Different types of trading are better suited to different types of traders and their personal constitutions; which is right for you?
“You need to have an edge.”
Stephen wants to know: how do you make money in futures trading? According to Matt, to grow your account steadily, you have to have an edge that goes beyond technical and fundamental analysis. Tracking setups that have the probability to work will give you an edge. His edge is statistics, and in the episode, he explains some of the ways in which he uses statistics and tracks them.
It’s as easy as X, Y, Z
Matt literally has boiled down trading to a science and offers a simple X+Y=Z equation for choosing stocks.
X = the condition
Y = the trigger
Z = your follow through
In the episode, you’ll hear more about using this equation for creating a trading plan. As Matt admits, it can be boring, but it delivers results. As he wisely imparts, “I don’t believe in the psychology of trading, it should all be mechanical.”
Advice from the Triforce Trader
When offering the secrets to his own success, Matt credits two things in particular: reading, and seeking out a mentor. For him, traders like Larry Williams, author of Long Term Secrets to Short Term Trading, have been pivotal in terms of education and shaping his own trading career.
Trading is real work, and you need to have an edge. A mentor and a strong education can help you go beyond the initial “addictive” phase of trading so that you can truly build a long-term career.
Why triforce trader?
In case you’re curious about Matt’s trading alter ego: it comes from the video game The Legend of Zelda, about a boy who has been asleep for most of his life but finally wakes up to do something. This is symbolic for Matt, who feels that trading helped him come to life.
Of course, this begs Stephen to ask the important question: who’s your favorite superhero? Leave a comment in the show notes!
If you would like to hear more about anything discussed in this (or any) episode, be sure to visit the “submit your audio” section on our website to ask your question; it might just be featured on the air!
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