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Podcast – Buying into Private Businesses

Stefan Angelini is Joined by Sean Soole to discuss investing into Private Businesses. If you've seen those up and coming businesses that operate close by or that a friend runs and you've been thinking of getting involved, this is for you! We focus on investing into the person, as opposed to the business and ensure you understand that this doesn't always work out and relationships here don't always last.


Stefan Angelini

Hey hey hey thanks for tuning in to another episode of investor types where we sit down with business owners business managers or investors of best of class investors to find out who they are how they do what they do and hopefully just to get some ideas for our own portfolios or what we want to do now this this episode we're focused on something a little bit different for all you share traders out there or for all you people that try to run their own share portfolio and originating day trading or not really looking at shares from a long-term perspective of more looking at shorter term trading this is a real episode for you so something where you don't rely on income it's purely just a growth strategy and getting in and out as fast as possible and this is quite an interesting story so Santo Surace I hope I pronounced that well I've tried to put on my Italian accent mate


Santo Surace

Thank you


Stefan Angelini

So Santo used to be a Sparky so used to be an electrician so you used to play with data and cables all the time but now he trades off data which is a little bit different and he's a day trader so Santo thanks for coming with me man how you going


Santo Surace

Thank you for having me thank you for having me as well this is exciting


Stefan Angelini

I'm so exciting


Santo Surace

I'm really well and these can in these conditions and really well I mean everyone's sort of locked at the moment


Stefan Angelini

Yeah


Santo Surace

It sort works well for a day trader cause he's just stuck indoors and you have to go outside so


Stefan Angelini

And you get to play with massive levels of volatility which I had


Santo Surace

That's right


Stefan Angelini

And my clients hating this I hate these volatile markets but mate


Santo Surace

Yeah


Stefan Angelini

Could be a winner but first it's good trading right


Santo Surace

It's a good time


Stefan Angelini

Everyone as you growing up everyone hears that day trading you know I want to try and day trade these stocks great valuation no one getting now make a good 5% on it and then just get out and just keep doing that


Santo Surace

Great


Stefan Angelini

I'm very different I focus on long term because you I see a good company I like it I think it's gonna grow the long term and I'm in it and I'm staying it because I'm a long long term investor day trading is a bit different but what I want to know from you is can you explain to me so what is day trading or short term trading and even in that space who are your main competitors


Santo Surace

Yeah so short term trading is you know holding any sort of position before let's say morning you might close it during the end of the session you might hold it for a few days you know really good generally not holding it for more than one or two weeks right and that's the way I see short-term day trading depending on the market you've got to adapt with the market there could be a trending market where you may hold a swing trade for two or three or four days but in a volatile market like the way it is now I'm sort of half-sized most of my positions I'm not trading as aggressively and I'm I'm trading inter day where in the morning I'm out drinking maybe the afternoon for equities I might hold a Forex trade overnight maybe on a Monday or a Tuesday I don't dare hold run over a weekend and we threw that as a horror story later on but that's that's basically short-term trading and in terms of competitors with and as you said you as an investor you're buying a really good business or you know something's performed in the past and you may hold it for weeks months years and short-term traders don't work like that where you are up against traders institutions fund managers algorithms market makers you're you're against it's literally the world against you and a retail trader is I like to say is like a rogue where you're jumping on it if you're good enough you jump on the on the wave of


Stefan Angelini

Yes


Santo Surace

The big institution money


Stefan Angelini

Yeah


Santo Surace

You're a pirate your earlier pirate you're taking on their money and you're gonna you're gonna hopefully sell when they're out as well and that's what I sort of look for in a market patterns and institution money I'll jump on the wave and I'm out I might scalp there I might scalp their position to be honest that's what I do


Stefan Angelini

Sounds of apart so when you're day trading how do you find out when institutions about to get in


Santo Surace

Yes so there's two types so equities and Forex work a little bit differently so as you know a business is in equity it's it's it's in their best interest to do better than they did the day before they're a growing business Forex is a range bound market let's say the Australian dollar let's say the bottom is 60 if you know at the moment maybe 63 64 cents it may hit a top of 71 will it go higher than 71 the next couple of months probably not but there's a range there right so we can trade and look for patterns in that range where there may be institutions buying at extremes or selling at extremes or buying whatever and we look for a pattern or I'll look for a pattern that I've found over time with some data inputs and I will take that trade or we'll ride that wave equities I'm using or news report so I might look at earnings and you know any sort of news event that may come out in morning and I may just take that drive in the morning as it opens but only out within you know the next for for next couple hours I'm I'm out of it so yeah the two different place


Stefan Angelini

Yeah you're gonna be risky and confident to do that


Santo Surace

Very risky very confident


Stefan Angelini

So what you used to be Sparky


Santo Surace

I was yeah


Stefan Angelini

An electrician for all you or you all of you out there that there


Santo Surace

I was


Stefan Angelini

They trade


Santo Surace

I was electrician so yeah


Stefan Angelini

How did you pick up your passion for trading both Forex and equities


Santo Surace

Yeah it started actually looked equities actually started back in the eleven and twelve we had a school that offered accounting as a as a class as a as an elective and one of the assignments in the accounting elective was the share market game and


Stefan Angelini

Applied that


Santo Surace

Yeah yeah a lot a lot


Stefan Angelini

BHP BHP killed me


Santo Surace

BHP yeah


Stefan Angelini

The next you did 30%


Santo Surace

Yeah it's always in there it's always in there yeah so that's all we one of the assignments eps game even though I was terrible at it we learned some basics about PE ratios EPS like the you know teacher would show us really basics and we just try and perform and then at the end of the month or the end of this time and you have to write about your findings and and what not and I loved doing that I was like one of my favorite subjects and I thought accountants were and I thought accountants were stock traders that's what they were


Stefan Angelini

Okay


Santo Surace

And so anyway fast forward and that was where the passion sort of started


Stefan Angelini

Yeah


Santo Surace

I became a Sparky after school and it was maybe 2015 I got a job over overseas and I follow up better buy some reading material and I bought Rich Dad Poor Dad and a couple other really books and that sort of ignited the passion for investing again


Stefan Angelini

Yeah


Santo Surace

We'll say that we'll say the word investing because that's what I was doing back then I was buying and holding into I hoped it got better


Stefan Angelini

Yeah


Santo Surace

With no education but that's what it was back back then but that's where it sort of started and then from then it just snowboarding to where I am now


Stefan Angelini

And you started getting into more pattern and trend trading


Santo Surace

Yeah that was pattern trend trading start in 2018 in this in start 2018 so as I said before that 2015 and 16 were punting pretty much on the share market


Stefan Angelini

Yeah


Santo Surace

You know I'd be right you know I was working away back then I'd ride on a piece of paper what went up 20% today and then what went down 20% in the next and quickly jumping and buy based on big volatility and it wasn't it wasn't smart at all it was


Stefan Angelini

Alright


Santo Surace

Quite dangerous it was a lot


Stefan Angelini

No real research behind it besides no there's


Santo Surace

No research


Stefan Angelini

Its gonna go none yeah


Santo Surace

That's right no reason and it was a lot of hunting


Stefan Angelini

Hunting


Santo Surace

I thought it was hunting it was


Stefan Angelini

Yeah


Santo Surace

It was a hundred percent gamble


Stefan Angelini

Yeah


Santo Surace

And it was mainly penny like you know really small cap stocks so you know nothing really over 50 50 million in market cap so I was extremely high risk and you know pretty much yeah that was the start of it and then in 2017 I sort of said not going to stop doing that read more books educate and that's what I've done from then and then 2019 I completely did a 180 and changed


Stefan Angelini

Yeah mate that's so interesting but you've worked in some interesting places like you worked in Nauru you fly-in fly-out


Santo Surace

Yeah yeah both fly-in fly-out Nauru was I was a maintenance electrician over there anyone doesn't know Nauru just take just pupping island to middle the Pacific Ocean that was a fantastic experience being away from home was was quite hard but it gave me a lot of gave

me the ability to do what I wanted to do and that was study and and trade because

of three weeks on three weeks off Rostov so when I was back at home I was dedicating every second of my time to learning and training and testing and back testing all sorts of stuff and then while I was there you know we finished at 6 p.m. and I was straight in the books at night to you know I went to sleep and it was repeat and anyone that was there could probably batch that they probably never really saw me at night


Stefan Angelini

So I'm going to who will fly and fly out or who would and who miners all that works work in the mines and they said that when you're over there you you you pretty much only talk about investing right see talking to


Santo Surace

You do yeah


Stefan Angelini

Cars shares property but most of my property and mostly


Santo Surace

Yeah they are


Stefan Angelini

It's I know property so what made you what made you differ or made you go away from the curb instead of property go shares day trading Forex


Santo Surace

Yeah look I was interested in property I've always still been interested in any investment but it was it when I was at Barrow in WA which was a gas plant a lot of the guys everyone was it was literally it was property and shares all you know how much of a multi good you in


Stefan Angelini

Yeah


Santo Surace

NBA or NFL yeah its proper bonding luckily I was really involved with any other was never insured in sports better or anything like that you know I have a laugh with Maltese but never really got into it and property I had a find interest of property but with property there's the I

guess there's a high margin of you need you know you need a lot of capital to get into that market and when shares you can get into the market with you know as little as you know come by the box


Stefan Angelini

Yeah


Santo Surace

So there was an avenue more towards shares through


Stefan Angelini

Yeah yeah


Santo Surace

Just through that at the capital side of it more than anything even though I yet do I have a fond interest of property it was a capital thing back then that's what drove me towards shares


Stefan Angelini

One thing I love that share it's flexible its liquid you can pull money out you can put money in quickly if you want to do continuing investments that easy but if you want


Santo Surace

Yeah


Stefan Angelini

Property that's you're locking down your 20% deposit you're not getting that out

until you sell the thing


Santo Surace

Exactly right


Stefan Angelini

Goes up anyway


Santo Surace

But it so goes up yeah


Stefan Angelini

So you can invest a little bits of money in shares and but what you do is the way you trade so you trade off patterns and trends that's the way you do your day trading can you explain to me you bit more around what what what's pattern in trend trading I get it


Santo Surace

Yeap


Stefan Angelini

But a lot of listening now listeners out there wouldn't


Santo Surace

Yeah okay for sure so as you said trend trading pattern trading they can work together as well I so I like their different they you can find patterns in trends but let's just define a trend so trend is on depending on the time frame you're looking at is a series of higher highs and higher lows in a beam in a bull sort of bullish market and lower lows and lower highs in a bearish market


Stefan Angelini

Like a lot weekly yearly


Santo Surace

Yeap so if we're looking let's just say let's look at a daily chart


Stefan Angelini

Yeap


Santo Surace

And a daily chart would be every see every every every bar on a daily chart represents one day it may be a month worth of high you know higher highs and higher lows could define a trend there's definitions of how to define a trend I just visually see higher highs and higher lows over a period of time and not you know respect to the time frame and that's a trend right


Stefan Angelini

I'd call that volatility so the more it goes up and the more goes down is essentially mark going up an analyze share price going up and down


Santo Surace

Correct


Stefan Angelini

Okay yeah


Santo Surace

Higher highs and higher lows when we're creating higher troughs and higher peaks so that would be a trend


Stefan Angelini

Yeap


Santo Surace

Right goes fits for a bear so and then there's pattern trading which it could be you know in a lot of a lot of good books on patterns so it could be wedges or flags Head and Shoulders reverse was which is you know you find them at the top of trends and then inverted Head and Shoulders at the bottom of trend which you know signifies a trend a trend change or trend lines and and what not there's a lot of different ways to trade a pattern so you can find a pattern in a trend you may have a higher highs higher lows where you get a slight pullback which probably presents some sort of continuation flag pattern for more upside you may want to take a break where breaks out with volume and you may want to take that that's what a trend or a pattern trade is now the patterns that I tried a little bit different to those they're just ones that I found over time from as I said I used to put a lot of time into this so I would pull up thousands of charts and draw every single picture I could find on the chart and then data put that on an Excel spreadsheet and data get all the data points of that and then find different highs and lows and find an edge and that's how you find edge is when you you find patent in a chart that present more times than not


Stefan Angelini

Alright


Santo Surace

Or if they present 50 or 60 percent of the time and they're winning trades that's an edge


Stefan Angelini

Yeap


Santo Surace

So I would look for that and again look at different markets foreign exchange versus equities we're looking at equities I would trend trade that one where if things are breaking new highs and breaking or breaking you like the low states breaking new highs I may want to take positions to appreciate greater in price because we're breaking highs it's a bullish signal


Stefan Angelini

So let's let's just let's just on that so the way you trade all those equities so let's say that


Santo Surace

Yeah


Stefan Angelini

Might break are higher and what that means is there might break a certain share price they've never been to before stock that trades it normally trade that fifteen dollars and all of a sudden it gets to twenty bucks that's that would be breaking a high


Santo Surace

Yeah so let's say historically the high price was $15 and it ticked past you know 15 or 2 let's say 3 months later and it presented some sort of consolidation as I said a continuation pattern or a flag it could break and create another new high which could be you know could be sixteen dollars or seventy it could be a multiple of what's happened in the past it could be a hundred percent multiple of its last range or


Stefan Angelini

Okay yeap


Santo Surace

Never that makes if that's sort of makes sense so that would be trend trading


Stefan Angelini

Situation yeah


Santo Surace

You bought you trend trade here you'd like deep so they say yeah you'd buy a droplet so you draw a trend line or it was sitting on some sort of 50 50 period moving average you just buy right and you swing that up cause you're in a bullish market or this this classified as a bullish market


Stefan Angelini

Yeah


Santo Surace

Pattern training would be different foreign exchanges and it's range-bound so you're finding patterns in different ranges or extremes you might you know as Australian dollar market 71 cents that's the extreme of the month and might be the higher of the month I'm not gonna go long to break that high I'm actually gonna look for a reversal there so


Stefan Angelini

So with your forex trading


Santo Surace

Yeah this is a little bit different yes so


Stefan Angelini

As you said that trend trading beyond the pattern in trend trading is a lot is a lot easier to adapt to foreign exchange


Santo Surace

Look I as I said before


Stefan Angelini

You've got experience in it


Santo Surace

Look I said before that it be stock market is like we're naturally built to say grain and

things go up we like the things to go up in value


Stefan Angelini

Either


Santo Surace

So naturally yeah so naturally we're because we were built that way when something is trading at a premium or selling it at a point of value sorry I'm not a premium at a point of value we say oh my God this is half price so we buy it


Stefan Angelini

Yeah


Santo Surace

What could be a share could be like a car share always same life if BHP was trading at $30 and now it's trading at $15 like it was a few years ago you don't really a lot of people really care about the fundamentals any like oh my God BHP is $15 it's half price so they buy


Stefan Angelini

Yeap


Santo Surace

Foreign exchange if you know the Australian dollar is 70 cents and then drops to 70 68 cents

no one's saying oh geez that's value because that doesn't mean anything that could keep on going to 65 64 63 depending on economy's going so the different ways to try those different markets that makes it new adapt to both of them in a different way


Stefan Angelini

So how do you trade Forex what do you look for in a given space


Santo Surace

Yeap so with Forex with equities we're trend trading we're looking with we're trading with the trend with Forex we're trading extremes so let's say we have the Australian dollar at 65 cents and that's the monthly high that's the highest price has been for the month and that price also has hit a high of January to hit two highs now I'm now looking for a particular two as I see two particular patterns that will fail that level and create the reversal and it will say fall in price where I might take a short short is taking a sell on a on a product where you capitalize on it while it goes down in value


Stefan Angelini

Yeap


Santo Surace

And that's what I'm looking for extremes in forex where my trend for three or four days and I want to take the other end of it to go the other way


Stefan Angelini

Okay


Santo Surace

So big different ways of trading


Stefan Angelini

And then this is the short term


Santo Surace

And then this is the short term or short term they might the longest or hold a forex trade now is maybe two or three days


Stefan Angelini

Right


Santo Surace

Regardless of the market


Stefan Angelini

You can't do this and


Santo Surace

You gotta be on it you need to be on it


Stefan Angelini

And when you're working full time you're doing this all night time


Santo Surace

Yeah that's right it was really hard in 2019 because it was the the the Forex markets highest liquidity is you know after 5 6 p.m. our time when the US and European UK markets so open so ideally you want to be on the computers at about 8:00 p.m. so anyone that does it actually works really well for people that do work full-time because if you have no commitments at night you work full-time you make your living and you can practice on the Forex market at night so it's actually a great we're actually in a lucky yeah placing on the globe for that reason and if you wanted to trade the ASX you had a quit your job because if you want to trade a 8 6 a day


Stefan Angelini

10 to 4 mate 10 to 4


Santo Surace

But you need to commit to it during the day so it's very highlight you got an night job so Forex market it's actually it's a great place to learn but it's very volatile it's got only five point

four trillion dollars in liquidity per day traded so to get in and out of a markets very easy


Stefan Angelini

Yeah


Santo Surace

You never have an issue getting out of the market but um yeah they're different


Stefan Angelini

So when were you able to use this you've been doing this for four five years now when were you able to leave your job just to focus on day trading full-time that's most people want to get to


Santo Surace

That's right yeah it's a long journey and a tough one as well so


Stefan Angelini

Yeah


Santo Surace

2000 you know all that study working away I came back I ended up joining a broker just to learn about the insides of the financial industry and then after that I so okay I'm ready to take this seriously again and cause you know I gambled in the beginning so I spoke to a friend of mine who had just other with his own business who are gonna thank a lot for what he has done for me in the past and I went on with him for part time as a Sparky so Tuesday Thursday and some Saturdays if he needed my help that allowed me to focus on trading Monday Wednesday Friday while also making a part-time income cause I had a little young family so that was all 2019 they allowed me to build all the structure the mathematical journals that I put through the calculators that I've got every pretty much everything that I do is now structured in a way that gives me the best best possibility to make money right so that was 2019 part time and in the end of 2019 I told Michael listen 2020 this is the year and I'm gonna go full-time and it just just so happened that it was right before the bush fires and right before corona of Covid 19 yeah


Stefan Angelini

Not a good start yeah


Santo Surace

Which look it's a good sound of volatility but it wasn't ideal like you know people anyone that's working at the moment saw them it's a good position to be and if you've got a full-time job and working because yeah you want a lot lot unfortunately a lot of people were not able to work at the moment so


Stefan Angelini

Right


Santo Surace

In 2020


Stefan Angelini

Set yourself up to go and do it if you need it


Santo Surace

Yeah


Stefan Angelini

Yeah


Santo Surace

I was I was ready to do it so I was ready to do it anyway and it you know we started up

in 2020 which was full-time and you know been doing it ever since and there's the real horror story in there which we figure out later sadly was because of the what's happening but it's just full-time


Stefan Angelini

So what has been one of the horror stories with with day trading that you seen and these started these sort of stuffs scares me big-time


Santo Surace

Yeah


Stefan Angelini

Cause I'm a long-term guy if it goes down I'm like I believe I believe I believe it will go back so tell me the horror stories what happens in this sort of market


Santo Surace

Yeah so like 2019 was a great year you know we does pretty much offsetting all my losses from the first two years it was great it was a really really successful year and then 2020 year and just to paint like a I try to explain as best I can so it came from the Forex market which is where I'm probably most confident and it slow down in December to January where I think a lot of liquid liquidity and volume dropped off over Christmas so I pulled away from the Forex market and then I went into the that's why I started really getting into the ASX in January


Stefan Angelini

Yeap


Santo Surace

But two reasons one that allowed me to spend more time with the kids at night but two the volatility wasn't as crazy there


Stefan Angelini

Yeap


Santo Surace

In February I noticed the Forex markets have to pick up again so I was like okay I'm gonna start doubling again I should have gone half pace I should have use half positions and got a feel of the market instead being a European mindset when football pretty much straight away and over I think it was the first week of March I was long so long as you know I was buying Australian dollar


Stefan Angelini

Yeap


Santo Surace

Over the Japanese Yen the Swedish chief and the US dollar now if anyone doesn't really know much about Forex the chief in the Yen are like safe haven currencies


Stefan Angelini

Yeah yeah


Santo Surace

So when things go be pear-shaped they appreciate in value now being long the chief and the Yen means I've got a no diversification I'm exposed on one way in one way only if there's something that goes wrong which sadly it was that weekend the chief in that the yen would appreciate together and in that period of time I was also short European British Pound and I was also long USD/CAD CAD and the Aussie dollar their commodity based currencies they tend to correlate higher closely as well so literally I'm exposed one way I've got no diversification whatsoever for the other way


Stefan Angelini

Okay


Santo Surace

And extremely heavily as well Monday open decisions on Monday never held anything over a weekend pretty much before like very rarely would hold things over weekends


Stefan Angelini

Did it this time


Santo Surace

And did it this time Monday open positions did well Monday night Tuesday Wednesday started to dip I was in draw down on Wednesday Thursday was sort of a sideways sort of day and I was in draw down still and I thought you know what fine I'll hold it this weekend it should come good next week massive mistake and that's where trading would just throw you straight into a dark area Monday opened gaping down which a gap is will explain it but a gap is in a sec but most these gap down 1.5 percent doesn't sound like a lot but with a leverage product of 200 to 1 I was a margin core Monday morning


Stefan Angelini

Closer


Santo Surace

Yeah so and more and just explain what a gap yeah just explain what a gap is it got let's say we bought Australia okay share for a dollar and we held it on let's say we bought it for a dollar on Friday and then let's say Monday open no one wants to buy for no one wants to buy or sell for a dollar they wanna to sell for 90 cents let's just say and the next the opening price would be 90 cents there's a 10 cent gap there you're not filled at the price you want to be feel that you're filled if you're in a you know if you want to sell and open your fill it that next best price which is 10 cents the negative that's called a gap so when the all five positions pretty much gaped on me with extreme leverage so that was a horror story it works out it work out six months of gains


Stefan Angelini

So you've got mate corners so you're not only like day trading which is risky enough but you're leveraging up to day trade as well


Santo Surace

That's right


Stefan Angelini

That's people realize when you're leveraging up you're using someone else's money so you're exposing


Santo Surace

That's right


Stefan Angelini

Your self a lot more it's like if you buy a property with cash what probably goes up then doesn't matter if you bought if you borrow money from a bank and the property goes up and down then the bank might one day come knocking at your door and go hey


Santo Surace

That's right


Stefan Angelini

Get some money back so the volatility in your portfolio would be huge but anyway hey that's why I love what you do like I've gotta take a nap cause I can't do that stuff but I understand I'll take risks in my portfolio and I'm already losing my hair


Santo Surace

There's risk involved but yeah there's risk involved but there's a lot of you know over time there's a lot of things that I've want to mitigate the risk and as I said one of the things that I learned from that disaster you know that's my own Black Swan event


Stefan Angelini

Yeah


Santo Surace

One of the things that I've learned from that disaster is there's no more hold over weekend is like the number one thing on my training plan after that week a weekend others had sent me into a really dark place


Stefan Angelini

Yeah


Santo Surace

What a hard work on you you will hit the books and redefine your whole trading plan to become better and better and that's what I've done and there's a lot of rules as I've got now that I didn't have before that that have probably they will save me now if anything has to happen so


Stefan Angelini

I believe that once something goes wrong you can only learn


Santo Surace

That's right


Stefan Angelini

I had a business blog from total business partners in the past and now do shareholders agreement whenever I get into a new business


Santo Surace

Yeah exactly


Stefan Angelini

and you know even even the shareholding stories you know I used to try and do it you didn't buy and buy shares when they went down cause the share price went bad and it was a decent company about their look at the fundamentals I was like don't worry about it it'll take care of itself but it doesn't necessarily


Santo Surace

Yeah


Stefan Angelini

You're right we give your brain starts to change as soon as you something goes wrong and

your your current gets method of doing things is tested you go I need to snap out of it I need to be better next time that'll make you a better trader I'll make you a better person everything


Santo Surace

It does we only we only become better because of these these hurdles and hiccups that's cause for any job me as a sparky as an apprentice you know when did I learn the when I did learn my lesson when I cop the shock so that's you know and and that's where you learn your lesson sadly but and it's like it's everything that we do isn't it and


Stefan Angelini

Yeah


Santo Surace

That's why I brought it and every single thing that I put together in a trading plan is redefined refining and then defining better ways of doing them so


Stefan Angelini

Yeah 100% now speaking of shocks so i'm a financial tax advisor so I speak to a lot of people that might be day traders


Santo Surace

Yeap


Stefan Angelini

And we don't realize is that if you're if you are a day trader or you trade on things and you sell before the 12 month periods up and you are taxed on that whole gain


Santo Surace

Yeap you are


Stefan Angelini

Whereas if you are longer than twelve months you can trade a capital gain you might be

able to claim partly tax tax discount or a fifty percent capital gains tax discount man so that's

something you've got to watch in your portfolio could imagine that if you do you know day trade guess you can offset the loss of the profits with the losses which is okay but come tax on that's tricky you gotta monitor all


Santo Surace

Yeah


Stefan Angelini

And everything like that you're running a business essentially in your own name


Santo Surace

You are yeah and and we always try to make money don't we we don't wanna


Stefan Angelini

Yeah yeah


Santo Surace

Offset losses every year don't move anywhere yeah I've got really great accountant he's really savvy with the sort of stuff he's traded in the past he was a trader many years ago so he's really great I went looking for a trader savvy accountant


Stefan Angelini

A 100%


Santo Surace

And I document everything I've got you know all my statements are all in Excel I've got a very thorough documenting and as you see you don't get that capital gains discount look 2019 I was only net net break even from my mistakes in 15 and 16


Stefan Angelini

Yeap


Santo Surace

And but as of June June this year so after mid year we'll be setting up a really comprehensive hopefully business structure


Stefan Angelini

Yeah


Santo Surace

To take forward for next year so that's all with the professionals I'm not an accountant so


Stefan Angelini

That's not that's use them


Santo Surace

Give it to the professionals


Stefan Angelini

You got to cause you got to remain organized you got to remain organized


Santo Surace

You do


Stefan Angelini

You got keep a good track record because otherwise you come tax time when you're scrambling trying to find everything you did you don't remember


Santo Surace

Yeah


Stefan Angelini

But other than taxes look day trading this has been its it's would talked about so much because so many people want to get into the stock market because as you said you can get in and out with small amounts of cash we try and make sure profits and a lot of people say that in terms of volatility it's a great time to get in but let's talk about so day trading what you do what personality traits do you think someone needs to have in order to be a day trader


Santo Surace

Yeah that's a really good question and let's go straight to yourself you need a look at yourself in the mirror right you need to know when you're wrong you need to keep the ego out of it there's a lot of people that would place it you know a lot of people in the journey they will place a trade and they don't want to be wrong and I'll leave it open until they're right that's a hurdle that's a the biggest the market will give you money the markets a fountain of money it's if you're number one good enough to go take it but number two you disciplined enough to take it so the first trade is discipline is the yourself look yourself in the mirror when you're wrong and improve that what's the one thing that I had to learn in the first couple years and that's why


Stefan Angelini

Yeah


Santo Surace

We hit the books so that's number one the second is resilience you need so resilient you want to get knocked down nine times out of ten it's very hard to be a day trader


Stefan Angelini

Yeap


Santo Surace

You're against we prospect about it before you're against market makers fund managers instead instead you're against algorithms that have been built by the best of the best you're commission on top of that your interest overnight and hold anything overnight for these Forex trade you factor all these things in and let's say you're right sixty percent at the time you don't make money you need to have a very good strategy that might give you a risk reward if we know one to two or one two three with 60% strike to make money so a lot of things are against you so you need to be resilient you're gonna get knocked down and what work today may not work tomorrow so you're gonna get knocked down and you're gonna come back bigger and better so that's resilience you need to be passionate because every single moment that I ever had spare went to this gave up all my hobbies gave up all pretty much all my time that I had to do this for you know nearly four or five years in now and it you know took three or four years to to get to where I am so you need to be extremely passionate methodical was something that I had to learn the hard way I had bad habits


Stefan Angelini

Yeah


Santo Surace

Before trading really bad habits I wouldn't keep any diaries journals of anything now I'm you know 2019 became and again thanks to my my old boss for let me give me time to focus on

these sort of things but I built structure when I wake up meditate plan what did the overseas

markets do what did this do create a short list everything is planned one after another that's methodical that's how you succeed in this journaling when you do that every single positive and negative of the day I'm journaling about it writing how can do it become better the next day


Stefan Angelini

Yeah


Santo Surace

So that's my thought and that's what discipline comes from that's not the trade it's being extremely disciplined and then two really important ones a problem solving so you need to have a mind to problem-solve what's going on


Stefan Angelini

Yeap


Santo Surace

You need to be able to read the macro than micro news and and get a I guess a picture of what's happening and there's a lot of books that can help you with that the other thing is being proactive the market will evolve it's either going to take you you're gonna go with it or you're going to be left behind


Stefan Angelini

Yeah


Santo Surace

So proact as I said in December things changed in the Forex market a lot of the things that I was doing well wasn't working I had to adapt and evolve with that market


Stefan Angelini

Yeap


Santo Surace

You find different plays you find different structures algorithm get turned off and they get turned back on over Christmas people go to sleep people you know institutions have time off the patterns will change that structure will change nothing happens today is guaranteed tomorrow so being proactive in everything that you're doing trading inter-day will make you sick you'll become successful if you do all those things that I just said you know all those is going to be added


Stefan Angelini

It's it's any successful person you speak


Santo Surace

Anyone


Stefan Angelini

Encompass all those trades because successful people are constantly pushing boundaries wanting to better themselves wanted to make sure that whatever they're doing is the best thing they can possibly do and they're not type of person just to roll with the punches


Santo Surace

That's right


Stefan Angelini

Which is extremely good most of the people listening to this podcast will be that kind of person as well mate that's been extremely insightful the day trading part of it still blows my mind a little bit but you look you take you're taking risks risk and reward is probably a big thing that I've taken out of this is it void you can take some big risks and there can be some benefits or and amazing an app it'll pick up the tree there are some risks that come with that and there might be a tidal wave that comes and knocks you out so you just got to be resilient get back up back on your feet and go for it again and be prepared if you're gonna lose that money be prepared to go back in and go back in and go back in


Santo Surace

That's right yeah and that's a key thing everyone can understand focus on the risk focus on mitigating the risk and the money will take care of itself first and that why number two just get professional guidance or professional help with you know accounting and all those those things that you don't know about get the advice for it or go go seek professional advice for it and you become or like you'll become better at what you're doing in any financial industry just from getting the right advice so that's definitely number one


Stefan Angelini

Hundred percent so mate look I want to say thank you so much for for chatting with me Santo being an amazing conversation


Santo Surace

Thank you very much having me


Stefan Angelini

For all you people out there listening if you've got any comments feel free to leave a comment behind or reach out to me stefan@angeladvisory.com.au a lovely chat mate this would be for you know those risk takers who might be out there hopefully they have to go work on the tools anytime soon


Santo Surace

Definitely not


Stefan Angelini

That's it we're signing off there thanks everyone for listening Santo


Santo Surace

Thanks Stefan


Stefan Angelini

Lovely chat to you mate okay


Santo Surace

Thank you very much enjoy your day


Stefan Angelini

Bye everybody


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