Mod Note (Andy): The following is an interview we did with Marcello of wanderingtrader.com. He has a pretty amazing story to tell and he was nice enough to take some time out to answer all the questions we threw his way. He currently day trades while traveling the world. He has lived in 11 countries across 5 continents and has visited roughly 50 countries. .
He is also available to answer your questions, ask away monkeys!
- What do you trade and how did you find your success and build on it? It sounds like you basically just got some cash and taught yourself without ever working in a
I always was hustling in high school and throughout college. After I returned from my stay in Italy I decided it was time to do something with my life. The first problem is that I'm lazy by nature but in all honesty it could probably be said that most of my generation is lazy. I don't mind working hard but I don't want to work hundred hours a week for a corporation that will decide to fire me at a moment's notice.
My definition of success is not money, it's freedom.
I needed a career, a profession, where I could work for myself, from anywhere in the world, and make enough money or I didn't have to worry about money.
I took out $25,000 in student loans old "Fibonaccisystem" and bought a software program that costed roughly $8000. I started my day career then and lost the $25,000 within a month making stupid decisions in the market. This was before the 2001 credit crisis so you could ask for an unsecured student loan and no one would ask any questions. I took out even more loans.
At some point I realized that it was going to be very hard to pay back the tens of thousands of dollars in loans that I had taken out. Roughly 2 years later I sat down and looked at all of the daysoftware that I had purchased and got rid of all of the garbage. I kept it simple, paid attention to what is important which is the market instead of indicators in software, and began to find my way.
Over the years I have built on that strategy would help of others in addition to my own techniques. Fast forward to today and now am in the process of opening daycenters around the world to have the locals trade my money via the Day Trading Academy. What we have created at the Day Trading Academy is a group of highly skilled, very motivated, and extremely smart traders. We all work together now to improve the strategy that we call the Congressive Trading System to make each other better.
I trade the Emini futures exclusively, Emini S&P 500, crude, and have also started to look at the 6E (euro versus USD futures). I also invest in long-term positions with crude and also currencies. role - pretty amazing story!
- Where did you get additional capital after you lost the first $25k
I started before the 2001 credit crisis so I obtained more unsecured student loans from Sallie Mae. It was as easy as sending in the application and signing it and I would receive the funds within a few days. That is impossible nowadays.
- Basic overview of your
I trade with strict technical analysis. I wake up in the morning check for news and do a quick minute or two of premarket analysis and start . I trade for roughly one or two hours a day and about 5 to 10 days a month. The day strategy is based purely on momentum and high probability movements. There are a lot of people that talk about rules-based in this industry and I find rules-based strategies and systems to be faulty.
Since the market dynamic is continuing to change (at an even rapid pace nowadays) it's important to have a strategy that allows a trader to adapt. I call this a structure-based system that allows us to adapt with the market. If the market is moving really well then we will be more aggressive, if the market is not moving well then we will be more conservative. That is why we call the Congressive (aggressive plus conservative).
I use strict limits and stops and risk a maximum of five ticks which is roughly $62.50 on the Emini S&P 500. The average win is roughly $100 per contract. The concept is to win more than we lose and have our winning trades be bigger that are losing trades. This structure allows us to adapt to what the market is doing and only have to win 40% of the time in order to make money. Most of us have winning ratios of roughly 60% to 80%. strategy (technicals vs fundamentals, value vs momentum, etc)?
- Trading time horizon?
I am generally in a trade from anywhere to a few minutes to maybe 10 to 30 minutes at most.
- Why do you trade only at certain times?
Different markets move differently from time to time so peak times to trade certain markets change. A few years ago the volatility in oil was incredible now the volume has died down quite a bit.
If I'm the Emini S&P 500 I trade anywhere between 8am EST to roughly 10 or 11 o'clock in the morning. Today I was running a live class and review class so I traded for roughly 22 min. in the afternoon.
Crude I currently trade between 5am EST to the American market open (9.30am EST)
On the 6E (euro versus USD futures) I have identified great movement between 5am EST to 7am EST. this can also be traded during the regular American market hours.
- Do you only trade on US stock markets or other ones as well?
I generally stick to the US markets because they have the best volume. Due to the changing global economic environment I have started to actively look at other markets. The day center that is plan for India will focus on the Nifty which is the Indian version of the S&P 500.
The other major markets that I look at and trade is the European markets. The German DAX and the FESX (the European S&P 500) are great markets to trade. I even have had traders apply the techniques that we teach to the Australian bund and even equities. There is only one way to read momentum and understand market structure. Once traders understand that the sky's the limit.
- How long did it take you to start being profitable with day
Roughly 2 years. My career is going on 11 years now and I have been helping traders for about eight or nine years. ?
- Why day
I find that we are in unique market conditions we haven't seen for a very long time. I am very concerned with the economic outlook of not only the United States but also the global economy. I prefer day because it allows me to make great returns on my money but at the same time be flat at the end of the day.
It allows me to hedge my risk by not having any open positions at the end of the day.
I can travel anywhere, eat dinner, go to a park, and not worry about any open positions that could be affected by unforeseen circumstances in the world. over day-to-day ?
- What is your biggest motivation for wanting to travel?
Getting to know the culture, experiencing new things, meeting interesting people, to learn (they say that travel is the best education), and also investment opportunities. As the time goes on my travel becomes more business and my business more trouble. When I first set out on this current around the world trip it was just to travel and see things while now travel is an integral part of my business, and business is my life.
- Many people get sick of the general corporate lifestyle, what made you decide to actually go for it and give it all up to spend your time travelling?
I have always had to the kind of personality that does not go well with authority. I often clashed with my mom because I hate being told what to do. I left my mother's house the second I turned 18. There was a change in attitude after I started becoming profitable for a few years. I had enough money in the bank to think about things that I wanted to do. I always thought what if? What held me back was the fear of going out of my own.
After a trip to Costa Rica and Argentina I got a bit of a taste of what it's like to travel and day trade. To be free.
The second I got back to work I put in my two weeks and decided that was it. I made the decision just like that. The hardest thing was the fear of the unknown. It is very hard to go from the lifestyle that the world trains us to have. A 9-to-5 job with the house 2 cars with a paycheck that comes in every week.
I just decided one day to pick up and go. I chose Canada as my first destination. At is different enough from the United States but not necessarily so different that it would be hard to get things done and figure things out. Funny story is that I sold my car the last day I was in Canada when I left to live in Argentina.
- Why do you move around so much? Do you have a specific goal in mind regarding # of cities/countries? Why not base yourself in one location for longer (and travel from that hub?).
What I actually do is rent an apartment and live in a city or country for roughly 3 to 6 months. The goal is to have a place I can call home (hub) that will allow me to stay home if I need to. Many times when I run day classes and teach traders I need access to reliable Internet. This kills two birds with one stone. I can make sure that I have reliable Internet at my apartment and then I can travel from there. If at any point I don't want to travel I can just stay home. I lived in Buenos Aires when I traveled through all of Argentina, Rio de Janeiro for Brazil, Santiago for Chile, Nairobi and Ethiopia for Eastern Africa, etc.
In the end I would like to travel to every country in the world. People and cultures interest me and I love everything that has to do with exploring a new destination. There are very unique things in the world and I would like to see them all. In addition to that I tie this with the day as I now plan to open day centers in several countries around the world.
- What have you learned most from traveling?
Patience, humbleness, and the understanding that no matter where people are from they are so different but at the same time so similar. It really has given me a world view and is help me a lot with my business investments. I also believe that every person that you meet can teach you something no matter where they're from, how much money they have, or what their "social status" may be.
- What are some lesser known places that you would recommend to travel to / to live?
I think Suriname (South America) is one of the most unique places that I have ever been to. It has an incredible combination of diverse people and there are very unique things to see in the country. It does get quite hot so wouldn't be my favorite place to live but I really enjoyed traveling through the country.
Addis Ababa, Ethiopia, would be the one place that most people would think to live much less visit. Ethiopia and the city of Addis Ababa is one of my favorite places in the world. They have great weather and are emerging from the stigma of starvation and poverty that most of us associate with the country. I was amazed to see how they were interested in all kinds of things like salsa dancing and even Reggaeton (Spanish rap). Very interesting place to be considering that it has thousands of years of history. Make sure to visit a city called Harar where you can feed hyenas. Click here to see the video of me feeding hyenas with my mouth.
I don't think that Colombia would be considered a lesser known place but many people still equate the country with danger and drugs. Colombia has turned the corner and the country is booming. The city of Medellin, Colombia, is in my top three places to live. The city has the nickname the city of eternal spring. It always helps when Colombians are the nicest, most gracious, and fun people on the planet.
While Europe is the most visited continent in the world most people would never consider visiting or living in Sicily. I had the pleasure of living on the island in the South of Italy for close to two years. Many would be surprised to know that Sicily has the best Greek temples in the world. Located in a central hub the island has been conquered and controlled by different cultures throughout time. I was able to travel throughout the entire island and many would not believe the variation of Roman, Greek, and even Arab tourist attractions to explore. It of course still has the old European charm everyone loves.
- What items are a necessity for you to always have?
The common saying goes that home is where the heart is. For me home is where my laptop is. If I did not have my laptop I would be completely lost. I have everything on my computer. The most important thing above all is to always be connected to the Internet. I run a myriad of businesses, have several investments I need to keep track of, and I wouldn't be able to day trade if I didn't have Internet.
I had a very tough time in India and spent a fortune on five star hotels in order to make sure I had reliable high-speed Internet.
I can do without anything except my laptop and Internet for the most part. In terms of physical possessions aside from my laptop I would say cell phone, cameras, and backup hard drives. I used to have a blackberry until 6 months ago and I cannot describe how much easier it is to do things with the new Samsung Galaxy S3 that I purchased.
- How, if at all, has constant travel affected your day
This is the worst part of my profession I would say. The problem with travel is that you cannot work and travel at the same time. There have been times that I have not been able to trade at all due to a rigorous travel schedule and unreliable Internet. Countries in Africa that do not have access to the coast are the worst.
I have had to be extremely efficient when I am in order to maximize my profits. I generally trade only 5 to 10 days a month and roughly 1 to 2 hours a day. Since I am able to trade any market with the strategy that I use I've also been able to adapt to markets around the world. When I was living in India and Africa it was a perfect time to trade the European markets, crude, and of course the American markets.
One thing that travel has also done is open my eyes to the possibilities of other markets. One can say that the United States is the the mecca of the world but that is quickly changing. I'm currently to open a center in New Delhi which will focus on the Nifty (India's version of the S&P 500). The concept here is that 20 to 30 years from now India and even China have the possibility of having larger markets in the US. Why not start to trade them now? ?
- What are some other downsides?
Imagine arriving in a new country where the local language is completely foreign and you don't know one person. Not one. It can be tough arriving in a destination and having that feeling.
Dayalso is a lonely profession. I don't go to work every day in an office and have to deal with a boss that barrages me with nonsense information. I believe we call it "constructive criticism" in corporate America. At the same time it is a lot harder to make friends and keep friends since I am always on the road.
Also vigorous travel schedules also affects my performance when it comes to day. Because I teach traders that keeps me in tune with the market but at the end of the day is a performance activity. There are times when I'm tired because of long flights or exhausted from traveling were my performance has been affected.
See part 2 on Monday April 8th, 1PM et