- January 9, 2013
- Posted by: NetPicks
- Categories: Trading Article, trading interview
Today I ask Mark Soberman, President and Founder of Netpicks, about the life, the universe and everything trading. I think you’ll agree that there are some fascinating insights from some of his answers.
1. You’ve been in the business a long time now – Netpicks was founded in 1996. What do you think has been the biggest change you’ve seen over the years in the markets?
Yes, it’s hard to believe it has been 17 years since founding NetPicks. I’d say the biggest changes I’ve seen are the number of choices to trade. It used to be that you basically traded stocks and if you got “fancy” you’d add some leveraged options to the mix. These days with futures and forex there are numerous markets you can trade – but what I’ve found is many to most are a waste of time and effort for the individual trader. So the challenge is parsing out all those options to the ones that give you the best chance for repeated success.
2. I know you trade your own account every day, so what drives you to continue teaching your systems to others?
I think trading on its own is an isolated profession. While it can be rewarding monetarily, sometimes that is the limit of the rewards. Educating traders enables us here at NetPicks to give back and really try to help people short cut what is typically a very long learning curve. I also know that I personally made many mistakes and had little guidance when I started trading so I could see there was a need for this type of professional education, and it has been rewarding for the entire team here to go beyond just trading each day.
3. Who would you say has had the greatest influence on you in life and in trading?
That’s a difficult question since I really didn’t learn trading from a mentor. In fact, my early inspirations to pursue trading came from some unlikely characters – Wade Cook and Ken Roberts. If you’re familiar with them neither ended up with a sterling reputation but it was their writings that at least inspired me to pursue trading. In following both approaches and teachings I did not have success but I can say I was hooked. A bit later I found Jeff Cooper and started to realize that taking an indicator based approach to price action could work, I believe the book Hit and Run Trading was one of the first that opened my eyes to this possibility.
4. When we first start off in trading, most people go down many different roads exploring what could work for them and inevitably they go down some dead ends. Is there anything in particular that you wish you hadn’t done or feel you wasted your time on?
Yes, the worst habit I’ve always had is not staying consistent. My personality is one that I’m what you’d call a “fixer” — so I frequently went on misadventures trying to fix my trading system or approach. Even though what I was doing, had I just stayed committed would have served me well. Unfortunately when you go and try to fix what’s wrong with your trading system, rather than start to accept that a certain part of any trading system is going to be broken, you will be wrong a lot and you end up with unpredictable and usually poor results. Then the “fixer” cycle starts all over. I’d stress to anyone that once you have narrowed in on a trading system that has demonstrated itself to work you do need to stay committed and not feel you have to fix what is broken. If it breaks 40% of the time – so be it.
5. With the business and family life in addition to trading, I’m sure it could be difficult at times to balance everything if you’re not careful and have your trading suffer. What do you find helps you the most in order to keep the machine well-oiled and running smoothly?
I haven’t always found the right balance. In fact, NetPicks in particular has been a labor of love and many times pain. What I mean by that is trying to balance life, family, trading and a business as demanding as NetPicks is a difficult challenge. I think the key is finding a great team to work with which I’m fortunate to have pulled together from actual NetPicks customers in many cases to work on the team. That helped considerably. In addition, I’ve had to accept the fact that I could not trade with the same frequency as before, that I’d need to make some tough choices and always put NetPicks customers first, my personal trading goals second.
6. If you weren’t in the trading business, what do you think you’d be doing instead?
I’ve always been very entrepreneurial. I ran a couple of businesses when I was in high school and really from that point on supported myself. Though I did work for a time in corporate America there’s no way I could have survived in that long term. I always seek out new challenges and get excited about business opportunities. Even now I get involved in some non-NetPicks ventures to keep my skills sharp and remain challenged. I’ve seen some success outside of NetPicks and that has in turn helped me stay sharp in managing NetPicks.
7. Which book has had the greatest effect on your trading?
I really don’t think any one book had a great impact on my trading but as far as inspiring me to pursue this career I’d say besides the book mentioned above there was one from Gary Smith called Living the Dream Daytrading Futures. I never ended up following the strategies but it certainly got me excited about the possibilities.
8. Did you ever have a moment that totally changed the way you look at trading and what was it?
Realizing that as much as I tried to analyze price action subjectively that I could never get down any consistent system and was really just guessing. I spent a long time thinking the people on CNBC that would come in and analyze a company and its prospects really had it figured out. I realized over time a coin toss would have been as accurate. From there I then started to accept that if I could be right 60% of the time, 70% of the time, etc… I would not need the holy grail. That I could be wrong a lot and still trade very successfully but I’d need something like a road map so I would know my decision points on every trade. Where to get in, where to get out and leave subjectivity to just a small and final part of my trading decisions – not the main part of what I do.
9. What have been your greatest challenges in your trading and in Netpicks?
Accepting drawdowns and challenging market conditions is always difficult. We feel a tremendous amount of pressure internally for our students to succeed. We know if market conditions are particularly challenging they could be facing a short term drawdown as well. Since we really want everyone to have success it is always a bit tense when the markets are not performing the way we know they eventually will. It is a matter of riding out a bad day or a week but that is always the greatest challenge. Many times we have to act as psychologists, not just for the market but for our customers/students and help them through these moments.
10. What do you think might be the biggest challenge to the industry over the next 5-10 years?
Forex has to get its act together. There needs to be a centralized clearing firm like futures for forex to really get credibility. Right now it’s still all over the map and traders are too reliant on an individual broker to make the market and process their trades. There’s a lot of shenanigans that can take place as a result and that ruins investor confidence. It certainly didn’t help that the regulations meant to protect individual traders in the U.S. in particular actually ended up hurting traders much more than they helped. Those are big challenges because forex still remains very popular. We embrace that popularity but we also do try to have people consider alternatives in futures and equities which many times can be better for the bottom line.