My name is Roy van Broekhuizen. I have been investing since 1977, before I got into day trading for a living in 1997. The fascination of watching the financial channels and quotes in real-time quickly got me hooked to the market on a daily basis.
I have been day trading since the beginning, June 1997, when I took a 1 month course at Online Trading Academy, paid $4,000.00 for the course and have been coaching people since 2000 when I retired from OTA.
I am the author of the “21 Golden Nuggets of Successful Online Trading” ebook, which is an extremely valuable guide for everyone who is seriously interested in starting to trade. I select my customers very carefully before accepting them as clients. Day trading is not for everyone. Most of my customers come by referral.
Roy van Broekhuizen is a trading coach in Long Beach, California. He started his trading career at an early age, and has a deep passion for trading. He is also interested in writing about his experiences with trading and how it is incorporated in his daily life. He believes that learning is a lifelong experience so he is constantly looking and researching new systems and methods, refining and fine tuning his own proprietary trading systems and methods.
Roy attributes his success as a trader to his commitment of fulfilling the Purpose for which God has created him.
Roy has definitely found his own niche.
FREQUENTLY ASKED QUESTIONS
When did you start trading, and how did you get interested in it?
I started investing in mutual funds in the 1970’s. I was living in Portland, Oregon and bought shares in Fidelity Magellan which did very well for me.
My next investment was in TWA and I almost lost my shirt, so I immediately immersed myself in reading as many investing books as I can get a hold of.
I then became interested in monitoring intraday price movements of stocks.
I paper traded some Internet stocks, and did very well initially. I was making simple trades, based on simple patterns that I picked up in the market.
In June of 1997, I opened a direct access account with Block Trading and took a 4-week Daytrading Course. The course cost me $4,000.00 which was reimbursed by giving me $4,000.00 worth of commissions as I started daytrading live.
There were 30 students in this course, in front of individual computer screens looking at live Level II information provided by software from Cybertrader.
In July 1997 I began actively trading, and was one of the first successful traders then.
There were only a handful of traders that survived.
I was grateful to be among the survivors.
I realized more and more that trading is not as easy as it looked.
I went on a quest to find the holy grail of trading.
I talked with as many successful traders as I could find, which helped me refine my techniques.
Eventually I evolved and developed my own style of trading.
By actively trading daily, I discovered my own secret “nuggets.”
What is your background?
I majored in linguistics and business at Lewis & Clark College in Portland, Oregon, thinking of a career in international business.
My hobbies were playing guitar and soccer.
I eventually decided to become a professional musician instead of pursuing a career in business.
My career choice provided me to travel all over the US and overseas.
I played guitar at my church, Saddleback Church in Lake Forest, CA, from 1997-2004 and I fill in at other local churches as well.
I have been in management since the 1970’s, and my entrepreneurial spirit eventually led me to start a number of small businesses.
I always wanted to be independent and trading was always in my heart.
After all, you can trade from any place in the world.
When I initially started trading, I tried to live off my profits, and with the success of daytrading education, I was offered a highly lucrative position as VP of International Business Development at Online Trading Academy(OTA), the pioneer of professional trader education.
I was at OTA from 1997-2000 and I decided to semi retire.
For the next 2 years I did a lot of research and international travel, and I went back into full time trading in 2002, and never looked back.
Are you now able to live off your trading profits?
How did you get interested in coaching?
I see so many beginning day trader students that are losing money and have spent so many $ taking different daytrading courses from different trading schools and still don’t have a clue as to “how to trade and make a living”. They need someone to really teach them about trading hands on, and who can make live trades successfully sitting right next to them.
However, trading is not for everyone, I am very selective in choosing a new student.
How do you gauge your performance? Do you set specific goals?
I set goals based on dollar amounts and my goal is to make a minimum of $1,000 a day.
I don’t worry because God is at the center of my life, and everything is in His hands.
However, trading is a business.
I am responsible and accountable for the money with which God has entrusted me.
The purpose is to make money and reinvest the profits for use in God’s Kingdom.
Does that mean that any trading day you don’t worry if you do not make $1000?
That’s why I like to coach and help others become successful traders.
When it is a slow day, I do research, chat with other traders, read and respond to my emails.
I don’t stare at the screen all of the time.
I look at the markets every day, and I can then determine whether it’s a day to trade or not to trade.
Most of the bigger stocks do not move much anymore like they did in the heydays of daytrading, so I feel very comfortable trading during this time.
By “comfortable” do you mean there are opportunities out there?
Yes, that’s right. I determine whether I’m comfortable by scanning daily charts. If I find some interesting opportunities, then I will watch the movement of the stock(s) for a bit to see if a trade makes sense. Other times I may stay away from the markets. I work on other things that need my attention. I may work on forming business alliances and marketing my website. I do advise my clients to trade part-time, in addition to their regular jobs, until they are successful. This way, the pressure’s off.
Do you find that it is tempting to keep monitoring the markets, even though you have taken a break for the day?
Yes, even though I am not addicted to it anymore like when I first started. There’s a huge difference between my first weeks of trading and today.
During the first weeks, I couldn’t stop looking at the screen. I would even go without eating. I wouldn’t eat until after 1 PM PST when the market closed. You learn through experience that there will always be opportunities, you just have to be there, and you will find them.
Don’t pressure yourself to look for them, because you will run into situations where you make too much of a prediction and form a strong expectation rather than just seeing what’s going on out there.
When you first started trading, did you tend to overtrade; did you trade when you shouldn’t have?
Yes, especially when your first trade is a winner.
You must adapt very quickly to market conditions.
It’s important to remember that there are always a few good trades out there, and even if you do just a few good trades a week, you will make money.
You can go in and out within seconds all of the time with no problem.
The traders who are really successful have a good sense and feeling about what they are doing.
It’s very hard to explain why they are good at it.
At that level of skill, it doesn’t have that much to do with analysis.
They just do it by monitoring the specific stock they are watching.
When clients ask me about scalping, I tell them to try it.
Most of them find out that they are spending all their profits on commissions.
What are some of the issues that prevent your clients from becoming good traders?
Many beginning traders have high expectations that they refuse to give up. They may have been watching the markets, and develop a strong opinion regarding a particular stock. For example, let’s take Intel. My students say, “Okay, I was watching Intel the last couple of weeks. I was trading it on paper. I made good profits, and I have a good understanding of the price patterns. I really want to trade it. I also have a big advantage when I trade Intel, because if I happen to be caught in the stock and it goes against me, I can always wait because it always comes back.” They firmly believe that Intel is so strong that it will eventually come back. Most of the time the clients are right. Intel does come back. But, I point out that if they are wrong one out of a hundred times, they are not going to be in the business anymore. However, they are often rigidly set in their opinions. I can’t change their minds. At that point, I tell them to go ahead and just try it. But, I also try to persuade them to trade only 100 shares or less, so they can learn from feeling the pain of losing without losing too much. I tell them, “Make the mistake yourself.” Other people are so confident in their opinions that they immediately trade 1000 or 2000 shares instead of 100. Holding overly strong opinions is one of the main problems of people learning to trade.
How do your clients respond to your coaching and mentoring?
They say that I have helped them gain confidence in their trading decisions, because I reviewed their trading decisions with them. They learn new strategies from me and are able to make money by using them.
Do you have any kind of specific guidelines for risk management that you use or that you offer to your clients?
The 2% rule. I don’t like to lose more than $200 on a trade, so I look at my risk, I look at my chart, and I see how many shares I can buy.
Isn’t a $200 loss a little too difficult to maintain?
Yes, it is, so there are times when I will go up to $1000.
Right, because you’re going to get stopped out, depending on the volatility.
I place my stop based on a technical analysis rather than a dollar amount. I look at the chart and determine where to place my stop.Then I determine how many shares I can take and if I’m willing to take that risk. There are also many other things that come into play when you consider your technical stops. The whole thing is fairly complex. That’s why I believe it’s very important to really learn over time. The ideal is to have somebody sitting next to you everyday for at least half a year. However, when people come to me, they usually already have some trading experience. They have a rough idea of the price patterns for certain stocks. They have read some books about technical analysis, but they have a hard time implementing the knowledge. Sometimes they’re actually pretty sophisticated traders who have a good understanding of fairly complicated technical indicators, but they have no clue on how to implement a trading strategy using these indicators. That’s where I come in. I sit down with them. I show them what I do, how I set up my trading screen. It’s often very enlightening for them. Then they go out there and they’re happy.
Trading isn’t a profession that’s consistent with feeling safe and secure. You have to take risks to make money.
It depends on how good you are and become. In the beginning I was quite reckless with my trading capital, until I finally realized that this was my business and this business needs to make a profit, not a loss. That is why I came up with the 21 Golden Nuggets Of Successful Online Trading ebook.
My successes far exceed those less successful after having paid my dues in the early years.
How did you get over your aversion to risk?
By just taking it step by step. Trading small amounts and then going larger, and keeping strict stop losses. Focusing on trades in which I really had confidence. There are really good opportunities out there, especially in the small caps and Chinese stocks. Have you ever talked to a trader who never lost money in a trade? Who never had a blowout? It’s all part of the business.
It seems that most seasoned traders have told us that they have experienced large losses at some point.
Yes. But if you have the passion for trading and you stick with it, you will make a comeback.
You’ve never blown out?
No, thank God!
Do you keep a trading diary, where you record your feelings and thoughts before and after you execute a trade?
I make detailed notes on particular trades, good and bad and why.
What were some of the things you learned from that process?
Whenever I was down on my trades, I would stop trading. Whenever I had a bad feeling about the market, I would not even consider trading. When you really understand the trading business, it’s fairly simple. You can do a lot of things in trading, but it all comes down to preservation of capital, and risk management. Get rid of your losing trades quickly and let your winners run. It’s very simple. You can have a lot of different strategies and they can all work out. Find your own style of trading and keep refining it. Know that patterns change all the time, just as in life.
How do you prepare mentally, physically and psychologically before you enter a trading day?
Mentally, I try to have a good list of stocks ready the night before so I can observe. I look for things that are detached from the overall market movement so I don’t have to worry if the market goes up and down. Ideally, I’m looking for something that will move my way no matter what the market does. I try to have this good list ready, and that gives me confidence .I try and take frequent breaks. I am an active soccer player, I still play music regularly and I make it a point to go on short getaway trips with my wife on a regular basis. Remembering to keep your overall life in balance is key.