In this episode of the Trading Justice Podcast, we welcome Greg Holmes to discuss trading, investing and the current market conditions. Greg is a coach at Tackle Trading, the author of the Rookie Corner blog, a veteran trader, a mentor for Legacy Education and a friend of the podcast. Being a Canadian trader, Greg has a unique perspective. We talk about volatility, risk, strategy, software, systems, setting goals and more during this value-packed interview.

Video Transcription

Tim: And welcome back. Trading Justice interview is something that we enjoy doing quite a bit bringing on traders and guests and talking about the markets and whatever else is on their mind. And we’ve got an old favorite a friend of the podcast a friend of ours Greg Holmes Greg how are you doing today.

Greg: I’m doing absolutely fantastic Tim. 

Tim: I got a very important question to start out Greg. Do you think it’s OK for a man to wear another team’s hat that he doesn’t actually cheer for.

Greg: Well not where I come from in the land of snow and ice. Now that’s that’s a punishable by death I’m pretty sure but that’s OK. Well let Well let Matt get away with it.

Matt: And this simple reality is when you’re a Miami Dolphin fan. Number one you’re a Miami Dolphin fan. Number two. Have you ever seen their hats.

Tim: The gear is not great. I will say that. But the Eagles do have good gear. I do like the hat man. They got a good team there’s not. There are worse teams that you could adopt. I know Mark is changes his team at least three or four or so

Matt: Oh mark is the worse fairweather fan in the history of fans

Mark: I wasn’t even going to participate in and I come in because one man doesn’t like the Eagles he loves Carson Wentz

 Greg: said you guys just get Josh McCown from the grave or something like that for the Eagles

Matt: That 40 year old can do crazy things

Mark: for Kodak. Our breaking news on the football they’re impressive actually. All right I want to shut up and let you guys get to work.

Tim: We can talk football all day long by the way. Greg is a Chicago Bear fan so we do share that pain that joy that pain all those things that is to be a fan of a franchise that hasn’t won in 30 years. 

Matt: You went Twelve and four last year you whiners.

Tim: I will say this though Greg we were voted number one team of all time above the Miami Dolphins even from 1972 and they’re undefeated season. I’ve not heard an argument yet that does defeat that premise. We will go with that. When I hear talk football the whole time that we’re here to talk markets Greg you’re a trader you’re a mentor the markets have been volatile. We’ve had I mean we’ve had trade works we’ve had China we’ve had Trump tweeting about what’s going on with these tariffs and it just it’s positive it’s negative during the month of May we sold off the volatility June rallied into July and all that kind of stuff. First off how are you approaching a market like this. That is definitely back and forth and news bound well with that kind of volatility.

Greg: I think you’ve got to shorten your timeframe. I think that’s number one. You know it can be volatility can hurt long term a longer longer perspective traders I’ve heard from a bunch of students recently that are you know a little little unused to this this type of volatility. I like it because you can if you’re if you’re a quicker trader you get a lot of opportunity to jump in on shorter shorter runs if you will with the with the volatility when you have that little choppy those small little candles not always picking a direction like we’ve got some really good consolidation as far as I’m concerned right now the very big candles you know if you can if you can watch it and be a contract type trader you can usually catch a couple of those runs and if you’re trading futures or you’re trading some highly directional strategies and you happen to be on the right side it can be very very fun.

Tim: if you’re not picking up on that accent  saying and the comment Matt or Mark made earlier about Greg being a Conan Greg is from north of the border who used to live up in isn’t Ontario right now Greg.

Greg: I not far from Detroit in Chicago and you do kind of come down in the states do work do business and also see a few sports games as well I believe. Is that right all the time.

Tim: Yeah. You trade the U.S. markets. You know we have a lot of Canadian students out there and we love our Canadian team. We have students from all over the world quite frankly trading the options market the futures market forex market the stock market. Greg we’ve talked about it before but just give us a quick run Now why do you still trade the U.S. markets even though you live in Canada.

Greg: It comes down to liquidity. We have some great companies here in Canada some world class companies. They do have options on them but they’re just not as liquid. There are the bid ask spreads are not as good. You know we just don’t have the volume that you guys have. The reality is trading the US you know I’ve traded European stocks I’ve traded to pretty much there I’ve found a trade I don’t like yet so but the reality is it’s just easier to trade and one of the first things my mentor taught me mentor I should say was all about liquidity you need to be in the most liquid markets because when we get this kind of volatility and and when we get this kind of news based stuff that you need to be able to get in and out quickly and the only way to do that is to have really liquid equities to deal with.

Tim: So you’ve got to dance where the dance floor is full there’s no doubt about it the liquidity behind the markets one of the most important factors. I mean even within the US market we select the stocks that we trade the ones we put on the option of report for example based on liquidity factors almost all the time. So it’s definitely one of the most important things to consider. You started trading in 2008 right. Right after or during the crash. I mean the financial markets crash brought it down. You’ve been on the podcast. Half a dozen time you’re one of the most frequent guests we’ve had we’ve talked about it before but you’ve been in this market during the entire bull run. You know is today in 2019 different for you than it was say in 14 when the Fed went into an interest rate hike and started seeing volatility or other trade war times I mean is this just par for the course with the volatility. How are you interpreting it Greg.

Greg: Well I don’t know maybe I have a warped or view of things but the slow climb that we had from 2008 until you know essentially last year at this time that wasn’t really my favorite time to trade. It was great for an investor but for an active trader it got I don’t want to only use a bad word here but stale. So I kind of look for volatility myself as a you know I obviously do a lot of stuff. You know we’ve talked about it on this podcast before about you know I do a lot of covered calls a lot of theta Strategies a lot of things like that. What people don’t know is that I trade you know day trade futures. You know I do know all sorts of directional trading as well. And so you know when when you get that slow drift up you know the directional trades if you can have a longer focus a longer perspective it can be great if you have a shorter term perspective you know where your day trading or you’re looking for you know shorter swing trades those kinds of things you know that volatility really it’s great because you can reach your destination so much faster and I personally enjoy that. It’s a little more action in the game if you will. You know and it’s it can also be scary if you’re on the wrong side or you don’t have a routine that can get you out of positions that they can put you in harm’s way so you definitely have to be on your game when it comes to that stuff.

Tim: You know you you are a blogger for tackle trading. You join tackle trading as a coach in 2015 and obviously anybody who’s listen to the podcast knows that tackle trading sponsors our podcast Mass. The CEO of tackled trading and I’m the COO  so obviously we’re tied in there Greg. What do you love about tackle. I mean I know that you’re you’re there all the time I see you like on our post on Facebook social media you’re not just a coach you’re a part of the community what do you love about it.

Greg: Well I’ll tell you something. It’s it’s the value that we put out. You know I say we more or you’re kind to me but it’s you know you can get into tackle whether you’re new or experienced or in the middle it doesn’t matter. There’s something of value for every trader and every type of trader you know I mean we’ve got we’ve got guys like Keith King with you know 30 years experience you know doing doing reports for us we’ve got new guys that are coming up and doing great things as well. There’s so many things there that that if you’re looking for something you can find it at tackle trading and and it’s it’s unusual in my experience and I’ve been around a little bit now and I’ve gone through a bunch of different programs and and all that kind of stuff. And it’s unusual to find all that kind of content and all that kind of knowledge in one one base in one place. It’s really unusual that way. And so I think it brings really high value for the members. And I’ll tell you if anybody ever asked me you know and it’s in my blog as well anybody ever ask me where do I need to go to learn learn how to trade tackles top of the list 100 percent.

Tim: Well you know I appreciate that Gregg. It’s definitely a we thing. I mean we are strength in numbers and we’re a growing team for a reason. You know I mean it comes down to the different perspectives different mindsets different attitudes towards market because we’re there just to help each other grow. And I love your blog by the way you recently did this long series actually I think it was like eleven part so far there’s even a few more planned on market systems and conditions and by the way if you’re out there listening you can find Greg’s blog on tackletrading.com. It’s under blogs and it’s called the rookie corner I believe is that right.

Greg: Yeah that’s right. That’s right. So the original premise of the rookie corner was I wanted to start and take someone from from doing absolutely no trading you know very little training and I just wanted to get them on a path. And so we started the rookie blog. We started it from the very basics and we’ve just worked you know step by step by step concept by concept concept all the way through and now we’ve gotten to this point where I did this series on what we call systems and conditions. So the way it works really is we have different market types. You know there’s there’s basically three types there’s there’s your consolidation phase there’s a breakout to the trend phase and then there’s what’s called a blow off phase. Now my mentor taught me this many years ago but in each one of those phases certain trades were way better than than other trades. So you know a lot of students when they’re new they just go in and say OK well I’m just going to learn this one thing and it’s going to be awesome in every market condition that’s not really how it works. OK. There’s there’s just better ways or more efficient ways to trade. And so what I tried to do in that is I try to take the strategies that work best in consolidation and go through a deep dive on those. The ones that work better when you’ve got that breakout to that trend you’ve got that directional movement. I went through those and I’ve got one more to go. Do you know the blow off phase that’s where you get a lot of volume. And you know usually big range and you’re usually looking at a turn when you get the blow off phase as well. So you know there’s there’s certain certain trades and certain trading styles that work better in that condition than the other two and so looking forward to finishing those up after I get through. Currently going over so.

Tim: you know I love a lot of the blog series that you’ve done within the rookie corner what’s really cool about it is based on the conditions in the market you actually will write about different things right. You know the fundamental analysis I think you did a year ago I sent those videos and those blog links to a few students just the other day. Gregg so its value that’s there for a long period of time. How do you decide on what you’re going to write about. I mean does it just change with the market. Do you wait for inspiration because you’re a really good blogger.

Greg: Yeah for me it’s just you know I try and kind of as best I can anyway I try to put myself in the situation of the majority of folks out there right because I was I was a new trader and I struggled the same as everybody else. You know I’ve got some work more experience under my belt now so there’s other new things that I do. I guess I’ve mentored a bunch of folks and I get I get emails and I get phone calls all the time and and they bring. They come to me with questions or or situations that they’re not aware of. And so I try to kind of throw myself into that situation say what is it that I would need to know at this point time. And I try to try to throw it into the blog there and keep it somewhat fresh to you know what I mean like you want to keep things I keep people excited and and those kind of things. So I try to think back on all the training and all the mentoring I’ve had and you know working with you guys as well I pick up every time we have a meeting I pick up so many so many new cool things from you guys that I just want to share that with everybody else. And that’s really kind of how I come to it.

Tim: You know I think that’s where good education starts by the way just a passion and an understanding that you want to share something with your audience right. Share knowledge information system steps whatever it might be. You’re now working on something called broker madness. Right. And I think being a Canadian and actually there’s a special mind of a trader webinar event this Wednesday that you’re going to be hosting for the pro members at tackle trading where you’re gonna discuss on how to use interactive brokers now very very clearly we don’t recommend specific brokers that tackle trading who you go with is up to the student it’s up to the trader is their own choice. But we have a lot of the same brokers that are very commonly used thinkers swim through T.D. Ameritrade Interactive Brokers is a very common one you know tasty works for example. What is it about broker madness being a Canadian that you can relate to so much and what are you talking about lately Greg.

Greg: Well we have some challenges here in Canada and it’s it’s something that I’ve been working on for years with with the brokers that we have. And unfortunately being a really small fish owner in a really big pond can sometimes be difficult and what I mean by that is you know the brokers that we we learn from like thinker swim you know which I think is you know again not recommending anything but I think Think or Swim is a great platform. It’s got a lot of good tools that that people can use. It’s what I was taught on all these things. It’s it’s good in that respect. The problem with that is is there’s only so many Canadians that actually do trade. So I’ve had conversations with think or swim I’ve tried to get a get them to treat the Canadians you know similar to what our American friends are able to access and unfortunately they for whatever reason they they they don’t treat us the same way. Now I realize that it has to do with different government issues and things like that. But you know from. From a cost standpoint you know for us for us Canadians to use Think or Swim. it’s a hard edge to overcome due to commissions and fees. OK. So this only leaves a certain choices here in Canada our banks you can go discount or you can go brokerages with them you can use discount brokerages you know I question. There’s a whole whole slew of them and I’ve actually been through I’ve been through 12 different brokers in my lifetime and you know I’ve basically whittled it down to the two that I use and the two that I teach with. And so every Canadian student that I’ve ever mentored I will teach them on Think or Swim and then if they choose to use IB I’ll teach him how to use that as well. And the reason being is because the commission rate is so much lower on interactive brokers that your ability to overcome that that cost is so much easier when you’re you’re you’re you’re. Commission rates are lower. And so that’s really one of the battles we have and then the other battle is kind of regulatory. We have certain trades types of trades and it can you know certain types of accounts as well so. Certain types of accounts our government will only let us do certain types of trades. Okay. So that’s another issue that Canadians have to overcome. IB has done an OK job with that. I’ve tried to work with them and get them to do a little better job with that. I’m hoping to make some traction with that coming up soon and then there’s also some new players coming in. I spoke to the folks at T.C. works as well and hopefully we get to get them down our way soon as well.

Tim: So do you ever feel like your American students are a little whiny sometimes because they don’t have to deal with all this stuff that you deal with right. I’m thinking of how easy it is in the US just to set up an account wherever you want. You know what it pretty much whatever broker get access to options and futures and that within a reasonable amount of time if you’ve got the risk tolerance and all that kind of stuff we don’t have to deal with these hoops.

Greg: You know what I mean yeah it’s like you said that’s Canadians. The problem is and you guys have 300 million people and we’ve got 30 million people so we’ve got one tenth of the population. And then of that one tenth of the population I don’t even know what the percentage of people that would actually trade actively would be but I’m pretty sure it’s it’s way less than you would think it would be. And so I think that when you look at it from a business customer service standpoint you know obviously if you’ve got 300 million people and let’s say you know 10 percent of those people trade actively you know those brokers have a lot more interest in making those people happy you know. Now if we take it we got 30 million people and say we’ve only got one percent that actually trade actively you know the customer service thing is probably not as high on their their list as it might be for our folks you know south of the border there. So yeah we’ve got some challenges. I worked through a few of them I’ve got you know I’m still working through a few of the others you know I’ve had I’ve got a little bit of experience with this. And like I said I’m working with. I’m working with some folks to make things better for Canadians. And so what I what I’m doing with the blog there as you spoke about and what we’re doing with the mind of the traders I’ve been using IB for for quite a while now and again it’s come down. It’s out of necessity if you will. And so I’ve had to learn the program and I think I have a pretty good handle on it. And so I’m I’m always teaching folks how to use it because it gives them gives them the ability to change things. The other thing about interactive brokers which is kind of neat which some people don’t know I mentored a few folks a lady from South Africa some folks from Thailand all these other places Interactive Brokers can can be done from a lot of different countries. I know a lot of the brokers don’t do that. So you know that’s that’s another advantage. So you know even if I teach in someone from Canada where I teach in some of my students from the states who want to get a different perspective you know or or folks in other countries you can teach them to use the platform and that’s really what we’re gonna do on Wednesday night is going to do a deep dive into how to use the the IB platform.

Tim: you know even in the U.S. by the way I know many traders who set up accounts and more than one broker for different reasons right. Don’t they’ll trade IB when they’re trading futures or day trading or whatever it might be. And maybe they do their option complexity stuff and think or swim and I’ve seen it all. Man I mean I really have I’ve seen different reasons why different experts and professionals will open up different brokerage accounts. So if you’re new to this game of trading and you want to check out what Greg’s talking about with Interactive Brokers Think or Swim these different tutorials how it all can kind of blend together make sure you catch the mind of a trader from tackled trading just on the Web site. There you’ll find it under the. This shows a couple of quick questions I want to ask you. Greg as we kind of wrap this thing up in the next few minutes I’ve got five questions that I ask every one of our guests whenever I’m doing the interview because part of my Fast Five.

Tim: Are you ready.

Greg: Yeah. 

Tim: Why did you get into trading.

Greg: Necessity I got introduced to the financial world in probably the worst way possible. I gave away control of my money and it ended up costing me 60 percent of my quote unquote nest egg. And so I decided to take the bull by the horns. I became a financial advisor I went through that system there. I realized that system was flawed and not that great for for protection from a protection standpoint. So I then started to learn to trade and I realized that there we do have the ability to control our own future if we’re willing to put in the work and willing to to get educated and learn learn how to take care of ourselves. So I felt that when I started trading I had some I had a lot of help and a lot of good good friends and mentors to help me out. And I realized that my best my best thing to give back would be to help others not fall into the pitfall that I fell into. And then that was being stuck in a in a financial world that I didn’t think I had much control over.

Tim: I love it. What you’re trading edge. What makes you good at this 

Greg: Passion. One hundred percent passion. If if something doesn’t go right for me you know I’ve had a couple of friends that started trading. They got into it. They had a little bit of early success. They then got crushed and because they didn’t have a passion for this game they they just called it quits. And I think that’s just the worst thing to happen you know is when I started playing and I started playing hockey when I was 30 years old. And I’ll tell you something. I was playing with guys who’d played since they were five years old so to say that I wasn’t very good at it is a mild understatement because I had a passion for the game. I kept going and I’m still playing today. Again I’m no Wayne Gretzky but you know what. I’m a lot better than I was 15 years ago too so I think trading is the same thing. You’ve got to find out what your motivation is and what your passion is. And I just have a passion for this game. I’ll tell you something. It’s the best thing I’ve ever ever found and I’ve done other things. You know real estate and those other things I’ve done all that and and this is me. This is this is my personality and it’s it’s it’s what I live and breathe.

Tim: you know I had a young man recently who’d gone through college gotten a Bachelors a Masters and all these different things even tried to career out a couple of different companies corporate Fortune 500 companies he was telling me his team trading is the only thing I’ve ever found where I just connected with it. I know it’s what I want to do for the rest of my life you know. And I thought that was really interesting. I’m not saying everybody has that kind of deep passion for it but if you love it you know you love it. Right. And then when you get into it really understand it you have those big wins those aha moments. It’s so powerful. It’s one of the reasons why in education and when those light bulbs click with a beginner why it means so much to us as teachers. Greg you know as mentors because we know the biggest hurdle the biggest learning curve is in your first year right. If you get over that hump. I mean that’s a huge part of it. I love the answer. What’s your daily routine time do you start. How do you approach it.

Greg: Yeah. So my daily routine actually starts the night before you know I take a look at my positions the night before and then in the morning you know I’ll just kind of do a review at night to see if I need to change things in my positions and then in the morning. It depends on what my day brings. You know if I’m if I’m rolling some positions I have I have a longer term perspective stuff where you know I only got to touch it once a month twice once every couple of months and then I have you know obviously the swing trades that I watch you know on a weekly basis and then you know depending on the day if I don’t have some other commitments and I day trade basically I turn on the machine I get my six screens going you know I get I get the OJ since I don’t drink coffee I get a couple OJ and I start looking at at these screens and I’m looking for specific things specific patterns looking for trends. Those kind of things all I’ll go through the daily routine as if I were trading swing trading so I’ll look at the news you know I’ll I’ll kind of look and see what the economic events that are going on you know just kind of all these things I look at all the over you know all the main charts so the main indexes I look at gold you know crude oil all the things that I’m going to trade right. So I go through all that. Like I said I’ve already looked at my positions the night before I might do another review of those and then I get ready to enter my trades before the market opens.

Tim: So kind of boom boom boom boom efficiency you know what you’re looking for you know what you’re going to apply because I know you trade stocks options futures and forex I mean use all the products in the financial markets and different times you day trade versus long term trades that you have to be efficient to more quick ones. What are you trading goals like what you want accomplished to say in 2019 the next five years 10 years whatever it might be what are your goals.

Greg: Well you know what the trading I’ve been doing for a while and you know it’s everybody’s got a trading goal. I look at it and I think so for my long term you know I have a certain percentage that I’m looking for a return that way everybody wants to you know build up their accounts doubled their accounts. But I also take a realistic view of it as well so you know what are my long term stuff. I’m looking at 20 percent a year. That’s really what I’m looking at. I don’t always reach that but it’s a good number to look for with the with the you know day trading I’m looking at you know a certain dollar figure per. Per month you know you can’t really do it much earlier than that. You know if you try and go Well I want to make X number of dollars a day are X number dollars a week doesn’t really turn out that way. It’s kind of fits and starts for the day trading. The other part I guess  my real goal is to keep learning I you know as we spoke before the show here I’ve had five or six mentors now and I actually have a plan to get another one I’ve got someone in mind that said you know many more years, many more years of experience than me I’d like to spend some time with that individual and I want to teach more and I do mentorships and I love teaching. You know I love doing these things on the blog and the reports for tackle training. I really enjoy that. And I see myself doing a little bit more of that in the next few years or so.

Tim: Well you are good at it. You know I’ll tell you I have seen your learning curve and your growth curve even through mentorship. Because when I first met you you were coming on as a mentor with legacy education. And they asked me to train you on how to mentor peoples you know. And I had a small role in the early stages of that with you and I watched your growth Greg just stay passionate with students. You don’t always do the best you can. Like you always will. I know your character and you’ve got the makings of a great mentor. You are a great mentor. Greg I appreciate the work you’re putting into our students. Last one. What advice would you give a new trader. And by the way a perfect guy to ask you the rookie blog writer so you give advice to new traders literally every week. So like somebody walks up to you on the street they’re like oh I would love to learn that. What advice do you give them.

Greg: Yeah. So two things. Take it slow and focus. You know you get into the world trading like like myself and you get really excited because you’re learning new things. OK. So if you don’t get excited when you’re learning something new you probably have very little excitement in anything really. So you know you get a lot of students come in and I’ll tell you it you know you and Matt and I have talked about this before. You know if we could go back to when we started I might have concentrated more on theta strategies right instead of all those directional let’s you know let’s do those crazy back ratio you know flip on your head kind of trades right. You’re all exciting but the reality is is if you take it slow and you focus just focus on one thing and then move to the next. Right. We don’t have to all be doing six like spreads every day. It just doesn’t it doesn’t make sense to do that. But you have to temper that excitement. And believe me I try to not only was I doing when I first started taking the stock courses but I was also taking real estate simultaneously. So I was doing both at once and to say that that was a daunting task is is the understatement of the year. So I feel like it is that focus and take it slow. And the reality is is enjoy those little wins. You know you talked about those big wins that we get as a as a more experienced trainer and those are great but just that little trickle effect of those you know those those credit spreads coming in or you know that monthly cash flow from your cover calls you naked Puts you know really enjoy those wins because those things pile up over time and it hasn’t really really cool effect. You know Matt said this to me one day that you know that the compound interest thing is is just that the cat’s meow. You know what I mean but you don’t you don’t necessarily realize that when you’re when you’re a new trainer you think I gotta I gotta make all this you know big money and directionally and it’s really only part of the game.

Tim:  I think a lot built into this answer that you’re talking about the difference between investor and trader mindset you know and I do see the mistake quite often Greg with new traders where they want to do all the fancy stuff all the time. And even in their longer term retirement accounts and I’m like Guys if you can just beat the market find your alpha do 20 30 percent a year in good years and you you have a plan through Covered Calls naked Puts and all that kind of stuff to diminish losses reduce your risk and just do conservative returns. I mean that’s powerful. That is huge. And there is a difference in mindset between trader and investor and I think account types do come into that Matt doesn’t know this but he probably triggered two bears fans here as the Eagles knocked this out of the playoffs last year. You know I mean the double doink I mean that is still deep in our memories right now as Bears fans. It hurts.

Matt: It’s deep in your coaches he’s crazy over his Kickers 

Tim: he’s going to keep cutting them if they can’t make a kick. But right now literally what you are is a kick for the Bears the worst job security on the planet is the Chicago Bears kicker. I can see that they might have five or six this year and I get it.

Greg: I’ve got a couple of buddies of mine play rugby they kick way better than any of the kickers we’ve had in Chicago and you guys got a good kicker.

Matt: Yes you had Robbie Gould decided not to pay him money and that’s bad karma on you guys.

Greg: That was a while ago so.

Tim: Ryan pays GM and the bears. I hope you heard what Matt just said right now pay the kicker find a veteran kicker that can put it between the post and maybe we’ll have a good season here. Greg I know you got to run. Thanks for joining us man as always it’s good to talk to you. To hear from you and we’ll see you in a webinar that you’re going to hold. Mind of a trader on tackle trading not common as always check out that blog. It’s the rookie blog from Greg Holmes and tackle trading on that one.

Matt: Real quick Greg you do an awesome job over there tackle. Keep writing keep doing your webinars. I enjoy every every second of it Greg.

Greg: Thanks guys I super appreciate this. You guys are a ton of fun and I appreciate you all. So awesome.Tim: All right. We’ll be right back after these words from Coach Mark.

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