Interview with Nick Radge
Nick is a professional trader, educator and author – who has been trading and investing since 1985. During this time Nick has worked for numerous international investment banks – from the trading floor of the Sydney Futures Exchange to International Desks in London and Singapore. In 1998 Nick returned to Australia and started his own hedge fund and until 2005 he was an Associate Director at Macquarie Bank. Nick now devotes all his time to The Chartist, private consulting and trading.
Nick’s expertise lies in trading stocks and commodities, trading system design and technical analysis. Nick is also very interested in trading psychology, he has conducted extensive research in numerous trading and investment fields and he has written two successful books.
How did you get started trading?
My girlfriend, at the time, had a brother-in-law working for a Futures Broker in Sydney. He asked if I wanted to come and work in the back office (admin). It was the best decision. As a result I learnt the industry from the ground up.
How long have you been trading now?
24 years
What do you like best about trading?
The challenge: I am always learning. It has taken me 20 of the past 24 years to refine my trading method. In fact my most successful system (I call it the Growth Portfolio) was in place and being traded 10 years ago but I changed tack and tried different methods. I regret not sticking with it as my account size would have been considerably larger today.
What markets do you trade?
ASX stocks and some US stocks
What style of trading do you use?
Purely technical analysis
What have been the biggest influences on your development as a trader?
Learning patience and discipline. It is easy to get sidetracked and either move away from your trading plan or to over-trade.
What is the one biggest lesson that you have learnt since starting trading?
There are very few bargains in a falling market. It is falling for a reason. Get out and stay out until the trend reverses.
About Your Trading Coaching
How did you get interested in coaching other traders?
Initially I was chatting on a trading forum to other traders and realised that I had a lot of knowledge that others didn’t. I had been studying technical analysis and testing my systems for around 700 hours by this stage (each evening after work). Other people don’t have that sort of time or commitment so I thought I could teach them and speed up their development.
Do you focus on coaching of one particular area of trading, e.g. risk management / psychology or finding trades?
I rarely coach people directly now as once again I have refined the process and contain all my lessons in one DVD seminar that we sell for $330. We found that all our clients had similar problems/questions so we ran seminars in each capital city around Australia 12 months ago addressing these issues. The feedback was fantastic. We encouraged our clients to get off the “beginner cycle” – stop purchasing books/ courses/ attending seminars (bit of a contradiction, I know), find one system or method that works and stick with it.
If I had to pick one area that we focus on I would say it is trade and risk management.
How do you work together with your clients? E.g. phone / email / screen sharing?
If clients still want coaching, after viewing the seminar DVD (which very few people do), we do it by phone, email, face to face or webinar – whatever they prefer.
What sort of results do your clients get after coaching with you?
After completing our seminar DVD we find clients finally get that “ah ha” moment. At last they get it! They can get off the education treadmill and start trading in a calm and confident manner. The results our clients get are realistic. If anyone offers you incredible results then your risk parameters are too high.
What is the most satisfying part of coaching traders?
Watching as people get that “ah ha” moment. You can literally see the light-bulb go on. Their eyes light up and they end up laughing, as though “Oh my God – now I get it!”
What is the biggest but most easily fixed mistake that you see traders make?
Trade management: Making sure that each trade is of the same value, that your stops are in place and that you don’t over-ride your system.
Do you recommend journals or other record keeping as an important part of trading?
A spreadsheet of trades taken, position size etc. A diary is a good idea for new traders. Record things such as your mood on the day, what made you take/not take a particular trade, etc.
What are the most common issues that you see in your clients that prevent them from becoming better traders?
Discipline. Trading is a career. People seem to think they can do a weekend course and start trading. It is not like that. It takes years to become a doctor, teacher, nurse etc but people seem to think they can step straight into trading with little or no effort. This is not the case. Trading requires discipline and dedication.
General Advice
What advice would you give traders who are just starting out?
Do not pay a fortune for trading education. Take the time to read and educate yourself. Design your trading plan and paper trade for several months. There is no hurry to start trading – the markets will always be there.
There is plenty of free information on websites such as www.asx.com.au or on forums such as www.thechartist.com.au/forum
What 3 books do you recommend traders read?
I’ll give you 5:
1. PPS Trading Strategy by Curtis Arnold
2. Trading In The Zone by Mark Douglas
3. Trade Your Way to Financial Freedom by Dr Van Tharp
4. Option Volatility & Pricing by Sheldon Natenberg
5. Master the Markets by Tom Williams