Joe Fahmy has invited me to speak at his seminar so I interviewed him. He is a relative strength trader.
1. How did you get started in trading?
My father got me interested in trading back in the mid 1990's. Back then, I was strictly a buy-and-hold investor. Basically, I had no sell rules and thought stocks went up forever. It wasn't until I went to work on Wall Street and studied the market that I began to understand how stocks really work. That's when I got rid of the buy-and-hold mentality and became a trader.
2. What kind of instruments do you trade?
I mainly trade stocks (US equities) on the long side. I occasionally short stocks, but I find that shorting is way too challenging. Therefore, I focus on what I know and stick to it. I also use options to give me leverage when I have conviction on a stock.
3. How do you find stocks you like to trade?
I screen the market every night using mostly fundamental and technical criteria. I use 8 main screens that produce roughly 1,000 stocks. I go through each chart individually looking for stocks that share characteristics of big winners from the past. I will share these screens at my seminar in a real-time interactive session where we'll go through stocks and comment on them individually.
4. What are your typical entry criteria or checklist?
Fundamentally, I look for stocks with strong earnings and sales growth. After that, I try to combine the proper technical time to trade these stocks based on chart patterns and market conditions. Finding a low-risk entry point is one of the most important parts of my trading.
5. How much do you risk on per trade basis?
My average position size is 10% and my maximum loss is 10%. Therefore, my maximum risk is 1.0% of capital. However, over the past 5 years and thousands of trades, my average loss is 3%. So, my average risk is 0.3% of capital per trade.
6. What are your exit criteria?
I have 10 different sell rules which I will discuss in detail at my seminar. Overall, I do my best to sell into strength, mainly because that's when you will find the best liquidity. When I am wrong, I try to stop myself out as quick as possible to avoid any major damage.
7. Do you scale in to positions?
Yes, I scale in, especially when I find 2 or 3 pivots around my entry area. For example, I might buy a stock at 100 and then add at a near-term pivot of 102, add again at a swing-pivot of 104 and possibly add again near another breakout area. It really depends on the stock, market conditions, and many other factors.
8. Do you scale out of positions?
Yes, many times I will sell half my position into strength to lock-in some profits. If the stock really blows-off and gets extended, I will sell the entire position.
9. What kind of options strategies you use?
Because options are an eroding asset, I try to give myself as much time as possible. I look for options 3-6 months out. I also like to buy options "in the money" so they at least have some intrinsic value to them. Too many people try to buy cheap options way out of the money to turn a little into a lot. This works sometimes, but it's tough to consistently profit with that strategy.
10. What can traders do to shorten their learning curve?
Find a mentor, read books, and be prepared to work hard at this! If you are looking to lose 20 pounds, you can do it on your own, but it is more efficient if you hire a personal trainer and study people who have lost weight effectively AND kept it off. Same goes for the market. Find a strategy that fits your personality, find someone who has been successful at that strategy, and then mimic it (with your own flavor of course). I DO NOT believe in reinventing the wheel.
Stockbee members readers can get a special discount for his seminar. You can go to: www.TradingBigWinners.com and enter the code: stockbee500. That code will work for either event (LA 2/18 and NYC 3/3).
Are you serious about your trading?
If you are serious about your trading and want to build an enduring edge the Stockbee Member site might help you. Members tell me they have tried lot of things before coming to my site and it has offered them the most extensive and detailed methods to swing and position trade.
It is only for those who want to develop their own self sufficient trading method. It is not a stock picking service. It is service for you to build your own scans and trading method to have your own daily pick based on your method.
Be warned it will take you time to learn to trade. Learning to trade is difficult art and unless you are willing to spend months or years to perfect your strategy and also develop your mental edge you are unlikely to succeed in this game. Unless you understand that no site, no service, and no mentoring is going to work.
Why traders come to stockbee?
The member site is one of the most recommended site for learning to trade by other traders and bloggers. You will see no advertising, no hard marketing, no promotions, no free offers, no affiliate marketing, no incentive to other bloggers to promote the site, no constant twits self promoting the site, no free trial and no tall claims of making you instantly wealthy, and yet the site attracts new members everyday. Members come from all walks of life and all kinds of trading size and trading styles.
You will see that many trading bloggers have been using my market timing methods, scans , stock ranking lists and chart templates. They have developed their own methods based on my methods. Many paid newsletter site recommend my site to their subscriber for learning about trading and market.
Over the years thousands of traders have been members and those who benefited from the learning talk about the site to others or talk about the methods used and that is how new members learn about the site.
What will I learn in the members site?
The members site will give you in depth understanding to develop your own trading method. The emphasis is on making you self sufficient and confident of your own trading method and style.
As a member you will learn the basics of swing trading, momentum investing, growth investing and risk management.
You will learn about Stockbee Trend Intensity Breakouts method that uses momentum based swing trading to find 3 to 5 day swing trades for 8 to 40% profit.
You will learn about Stockbee Episodic Pivots Breakout method which uses Post Earnings Announcement Drift (PEAD) to find stocks that had a game changing earnings and that are likely to rally for 3 months to 12 months.
You will learn about Stockbee Dollar Breakout method that uses momentum, range expansion and swing trading approach to find 5 to 40 dollar moves in high priced stocks.
You will learn about Stockbee Lemonade Strategy for 401k which uses market timing and momentum to invest in 401k. You will get weekly update on how I am using the strategy on our 401k to do allocation decision.
You will learn about Stockbee Market Monitor method for market timing using breadth. It allows you to avoid risky periods in market and allows you to identify market turns. It is used for 401k allocation decisions.
You will learn about Stockbee Double Trouble method to find stock with confirmed upside momentum using anchored momentum and that are likely to continue their up move.
You will learn about Stockbee Night Time is Right Time method to find news catalyst based trade ideas for short term day trade and swing trade.
You will learn about Investor's Business Daily’s IBD 200 list and how it can be used to find swing trading candidates for explosive moves.
You will learn about Telechart 2000 and how to use it effectively to scan for swing and position trade ideas and to set up your 401k strategy.
You will learn about Jesse Livermore Range Breakout, Darvas Box setup, and many other member shared methods.
You will learn how to set up your own scans, select right kind of stocks, how to set up stops, when to enter , when to exit, how much to risk, how to track your trades and all other details about trading. You will learn about developing your own methods and not relying on others for trade ideas.
The site has hundreds of videos and trading methods and variation of methods. Members help each other in developing the methods and share actively their research and finding. A collaborative spirit allows you to get input from others on your trading ideas or problems.
The site gives you opportunity to interact with some of the most successful traders and learn from them about their trading methods. It is a vibrant community with members from different background and experience willing to help each other. The emphasis is on continuous learning and up gradation of market knowledge and setup knowledge. The members range from hedge fund employees, financial advisers, active swing traders, investors and new traders.
If you are looking to develop your own trading strategy the membership site might be for you. You have to be willing to put in the effort to build your own method. There are no silver bullets offered on members site. Every method, every scan, every nuance is detailed and all possible help is offered to design your own method.
Do you have a trial?
If you are just looking for trial you are better off trying thousands of other trading sites that offer free trial or one month trial and offer you promise of riches.
It is for those who are ready beyond the trial phase and ready to put serious months or years of efforts to learn to trade on their own. It is for those who want to learn to find their own fish.
The free blog has all the details about the methods I trade and if you go through the posts highlighted in the sidebar you will learn about them.
How can I become a member?
To sign up go to www.stockbee.biz and follow the sign up process. The site uses Paypal for payment processing.