Today, host Tim Bohen interviews trader Jack Kellogg. This young trader’s into trading OTCs (over-the-counter stocks) that meet very specific criteria.
Every now and again on SteadyTrade, we like to interview successful traders from the community to help inspire our listeners. You can gain a lot from hearing about the different paths traders take and learn from both their successes and mistakes.
In the episode, Bohen quizzes him on a bevy of topics: how he finds stocks to trade, why trading is better with friends, and why he thinks college is a scam. Check out this action-packed episode!
The Jack Kellogg Story
Jack isn’t what you’d call a high-school scholar, but he’s a hard worker. He worked as a valet through his late teens, saving his earnings to build a better life.
Jack had little interest in college … and he also wisely understood that to live the kind of life he wanted, he needed to figure out how to make money. His 2017 New Year’s resolution was to learn how to trade. That’s when he discovered Tim Sykes.
He joined Tim’s Trading Challenge, first relying on paper trading to build up his trading skills. While his results were OK, they weren’t consistent.
In observing traders like Michael Hudson (aka Huddie), he realized that to find his own success, he needed to develop a specific strategy.
He began short selling … and initially did well. But then he got cocky and lost all his profits. That turned him off short selling. Once he got burned, he knew he had to shift gears.
The Evolution of Jack’s Trading
Jack’s big losses as a short seller are what led him to OTC stocks. In these low-priced stocks, he saw the opportunity to grow his account quickly. He developed a new strategy, and probably because of his losses, a smarter mindset. He’s been trading OTCs ever since.
For Jack, OTC stocks come down to risk/reward: “When you’re right, you can achieve amazing risk/reward ratios because of how they hold their levels.”
Benefits of Trading OTCs
In the episode, Jack talks about his approach to trading OTCs. You’ll learn how he strives for a risk/reward ratio of 10:1, what that means, and how things like VWAP and stock charts fit into the equation.
He also discusses what he sees as the benefits of trading OTCs, including less competition. He also thinks the smaller size can make them more transparent than Nasdaq stocks with things like Level 2 quotes — there can be less noise and fewer spoof bids.
You’ll also learn Jack’s specific methodology, including how he chooses entry and exit points based on factors like volume and past history. He shares his techniques for mitigating risk, such as increasing positions in trades that go his way and cutting losses quickly.
For traders interested in this trading style, don’t miss this episode!
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