Timothy Sykes - How To Make Millions Trading Penny Stocks

Full transcript: Timothy Sykes on London Real

3:08 This is London Real. I am Brian Rose. My guest today is Timothy Sykes, the American investor, author and educator who became a self-made millionaire by the age of 21. As a teenager, you turned $12,000 a bar mitzvah money into 1.6 million and later created the number one ranked short sellers investment fund for 3 consecutive years. You then starred in the hit documentary series Wall Street Warriors and now spend your time teaching trading strategies to over six thousand students from around the world.

3:34 Tim, welcome to London Real. Hey, thank you for having me. Great having you here. How is London treating you? First of all, love it.

3:40 Amazing food, amazing sushi. Actually, pretty warm, I’m excited, it is right? I mean, I dread like coming to cold places. I always try to stay tropical, but I came here for you, and it’s not that bad. I appreciate you like big cities, normally or you’d like to stay on the coast?

3:53 I do everything you know, big cities out there. I’m traveling non-stop. I’ve been in 12 countries in the last two months. Now, okay, very nice. Well, look, I walk down memory lane when I was researching for you, and I would love for the people-watching to kind of understand the basics of trading.

4:09 Why someone would want to trade? And then maybe we can get in some specifics of how you trade and the mental game of training. A lot of people would be really interested, because everyone’s seen the movie. Probably Trading Places was probably one of the first movies where they saw people trading futures, and then Wall Street Boiler Room. And I think everyone has an idea what it is, but no one knows what it really is.

4:29 Yeah, I mean, there’s obviously, you can trade a whole bunch of stuff. You can trade commodities. I trade stocks. I think that it’s actually better to be a trader than an investor. Like, I talk a lot of people like, oh, you’re in the stock market.

4:40 I’ve invested in Apple and Facebook and Google, and that’s fine if you want to, like, grow your money over the long run, but traders have different time periods. So I made, like, 2,000 dollars this morning here, and I held the stock for, like, 20 minutes, and I actually sold too soon. But if you can compound 2,000 type dollar profits, like every few days or every day. I’d like to say, you know, $2,000 a day keeps a real job away. I don’t win every time.

5:03 I lose, actually, roughly 30% of the time, but I cut my losses very quickly so if you win 2,000, win a thousand, win 500, and lose $50, lose $20, it adds up. So how do you actually win? What am I trading? Well, I’m trading basically inefficiencies in the stock market, right? So I trade low-priced stocks, which the whole hates, because most of them are scams.

5:23 They’re very speculative companies. They might have one or two products. They’re probably going to go out of business in the next few years, but I’m not investing in them when they’re going out of business. I don’t care what happens to them in two or three years. I care what happens in the next two or three hours or two or three days.

5:37 That’s my time horizon. So a trader, by definition, has kind of a short time frame. They’re looking at how things move in relation to other things, and they’re making quick decisions. Yeah, whereas an investor is kind of a buy and hold for a medium or long term and is expecting some type of annualized return. Yeah, not gonna really get anyone excited or buy Ferraris and Lamborghinis.

5:57 If you have a small account, long-term investing I mean, you might get rich by the time your Warren Buffett’s age, and then you can buy, like, a titanium hip like with all your millions after a few, you know, literally decades. That’s how compounding works. But for me, I’m holding very short-term, and I want my small gains to add up, and I’m trading these low price stocks. Why would I do this like, no one asked to, like, become like a penny stock trader at low price.

6:19 Not trader, but there are inefficiencies, like I said most of these companies go out of business in the long run, but because very few people pay attention to them. Sometimes there’s news, and it doesn’t get priced into the stock for one day, two days, five days. If you look at Google, and they announced some big news within five or ten seconds, traders around the world know it. It’s on CNBC the algorithm traders are all involved, and there’s no inefficiency.

6:42 So for me, I see good news and I’m like, I just hear crickets. No one even notices, and then you can buy the stock, and then when people start to notice, it, like, theirs starts to be, you know, journal writing about it. Hedge funds buying it, like, later two days, later three days, later and you have time before the world recognizes if you’re meticulous. So I trade these stocks. I teach my students to spot these stocks, and we just look for news.

7:08 You don’t have to try to predict news. I like to wait for the news to happen and then recognize which use has leverage. I’ll give you an example. VLT see was a stock that I bought years ago, and the stock was up from one to two on news that Carl Icahn, famous billionaire investor, was investing in it. It’s not beat up by out guy, right?

7:24 Yeah, yeah. So he buying this low price stock, and it was like this big news. So the stock doubled, one to two dollars, one to two dollars per share. That’s it, but big move. The value of the company doubled overnight because Icahn’s involved.

7:35 But I said no, when a billionaire invests in a low price stock, like he’s basically done the research. Like he can invest his money anywhere, so he’s giving credibility to this little stock. So I bought the stock. My whole chat room, I have like a thousand traders, and they’re always, like, looking for video lessons, and I teach them not just about picks but, like, the process. It’s like, why would you buy a company that just double?

7:54 Don’t you think it’s up too much? I’m like, no, this news has legs. a few days later, I sold it at roughly $3 a share. So I made, like, 50% on my money, two to three dollars, and then two weeks later is at 20. So I underestimated that.

8:07 That’s an extreme example, but as more and more people realize Carl Icahn invested in this small company, it could go up more and more. So I’m looking for these inefficiencies. Yeah, let me tell you about my experience of trading, and I would love if we can get into some of these nuances at different instruments. So I was at MIT studying mechanical engineering, and I had had a summer job at Ford Motor Company, and I looked around the place, and I was, I had a Ford Mustang when I was a kid and I was like, wow, this is everything I ever wanted.

8:32 And I looked around and I said, I don’t want to be these guys at 55 years old making 50 grand a year, and looks so boring here, and so I went back to school. And I must have seen the movie Wall Street, and I started getting the Wall Street Journal, and I was allowed to take business school classes at the Sloan School of Business. So I started taking classes at options and futures with the MBA students, and I started getting really fascinated with the stuff.

8:54 And I still remember the first night, it was like 1:00 in the morning. I was in a classroom with one of my buddies, and we finally figured out, like, how a call option and a put option work, and it was just like, wow, you know, it was exciting. Yeah, and so I diverted my engineering career, and I got recruited to go straight to Wall Street and work for a company called Bankers Trust and they were really big in fixed income derivatives, probably as far away as we can get from penny stocks, but still I want to talk about, like, what I learned about trading, and maybe you can tell me if it’s similar.

9:21 Yeah, so I got there. I was 21, 22 years old. I get to the 33rd floor. It was One Liberty Plaza, right next to the World Trade Center when it was still up there. It was like the Statue of Liberty on one side, and there was a football-sized trading floor of fixed-income traders, a lot of testosterone, not very politically correct back in ’93.

9:39 And I sat down at a desk, and I remember there was a board with like 60 different lights on there, and they were direct lines to all my energy dealer brokers, one to the Chicago Board of Trade to trade bond futures, one to the Chicago Mercantile Exchange to trade LIBOR futures, and then I had a box that would go to the government bond desk, and I could trade hundreds and millions of bonds to my government bond traders. Is that they didn’t scout me? I had to watch them, and then it was like they gave me two phones, and they said, trade.

10:04 That’s just this crazy experience. I had. I’ve dumped into this derivatives book, and we were taking long and short positions in fixed income, but I realized this really quick, and I want to get your thoughts on this. Is that nothing I learned at MIT taught me how to trade, because trading, I realized quickly, is about knowing yourself, knowing your own emotions, and I remember seeing guys that had literally things stuck on their desk. Trading rules, the trend is your friend.

10:31 Don’t get emotional about stock, right? Gordon Gekko. What is it? It’s a buying the bad news, selling to good news, right? Buy the nice other news.

10:37 Yeah, these were grown men, right? Buy the rumor, sell the fact that all these stuff, and they would just sit there and constantly run their brain. And I remember when I later work in Chicago, some of the locals in the bond pits, they would say if I had a fight with my wife the night before, I did. I wouldn’t even come into the floor. Yeah, because I was there losing money because I was in an emotional state.

10:55 So I started learning about trading and I started punting bond futures and trading stuff, but I also had a derivatives book I could fall back on. 4pl and I’ll be honest, I don’t think I ever became a great trader because I was more of a derivatives guy and a market maker and stuff, but I started to understand a bit about trading. Tell me, did I get an I into what it was about and has it changed since then? 100 percent still definitely not politically correct.

11:18 I mean, you’ll hear more swears, more creative terms than ever. If you’re ever on any trading thing, I saw a grown man tell another grown man he was gonna rape him in front of the whole audience. I mean, that’s not listen, there’s so Wednesday. Yeah, I know, and well, and on top of all of this, we were all waiting for subjective bonuses that were paid by the MD of course, so you didn’t even get to keep your mind. You had to prove you’re the biggest swinging dick to get there.

11:38 It’s very competitive. You know, you’re competing against other traders, other people in the market, and you’re competing against yourself like it’s very much about pattern recognition. Like, what is trading? You’re trying to take small gains very quickly, whether you’re going long or going short. I bet against a lot of these scams too, so I can recognize a scam, and then okay, can I stick with it?

11:56 Can I stick to my thesis? Am I discipline enough? And sometimes I might be betting against a scam, but scams can last longer than you think. So it keeps going up. So when I’m shorting it and I’m losing money, am I strong enough to remember rule number one, which is cut losses quickly?

12:09 I lose roughly a third of the time, but my losses are 1%, 2%, 3%. My gains are 5, 10, 20%. So if you stick with that, you can win, but sometimes you get so wrapped up. You do all this research on a position, you’re like, I know I’m right, the market is wrong, and you fight it. And a lot of newbies fight the market.

12:26 They think that they’re right, and their ego gets, you know, very strong in the market. Humbles them, right? That’s right, in the trend of your is your friend is trying to remind you of that. Yeah, I can’t fight them, or 100%, so you need to go in with a plan. You need to stick with a plan and execute the plan.

12:39 But too many people, especially like newbie traders who don’t know what a plan is, they think that they’re just investing in good companies or bad companies. They’re very simplistic. So I’m basically like teaching people how to train for, like, battle. I call this, like, a battlefield, right? Like, I’m like a war veteran.

12:54 I’m like a drill sergeant. I’m not even friends with a lot of my students, because I come down on them because I want them to survive on this battlefield. You know, most people don’t even understand what you’re talking about as far as, like, what do you talk about battle? Feel like you’re investing in stocks, but it’s, I’ve seen what happens when you ignore your rules. When you say no, this is a good company and the stock keeps going down and you blow up your account, you lose everything.

13:14 Most traders lose. If you look at 90% of traders, lose. So you look on TV, there’s a little dancing baby on E*Trade. Look how easy this is. If it was realistic, the baby would be on a battlefield.

13:24 He would have like scars all over it. Like, it would be blurred out because it would be too bloody for TV. Right, that’s like what trading really is in any market, whether it’s derivatives or stocks. Most traders are guessing, most people are gamblers, and they’re losing because they want the quick cash. So for me, I wanted to quit cash.

13:41 You know, that’s why I started. I started with $12,000. My account wasn’t going anywhere when I was investing in blue chips, but I learned in efficiencies like that Carl Icahn play that I talked about. That’s a best-case example, but when you see news that has already come out, like I’m not trading on inside information. That news is public, but people don’t recognize it, and they don’t price it in.

14:00 And if you look at it again, again, I’ll give you one more example. You’re gonna laugh at this. My first big strategy back in ’99. This was when the internet was booming. 1999, 20 years ago, I would buy companies out, added calm to their corporate name, right?

14:13 And this, I bought Sportsman’s Guide. It was a camping equipment company, and it still exists. They changed her name from Sportsman’s Guide Inc to Sportsman’s Guide.com, in the stock tripled or quadrupled over four days, and I did this every single time a company added calm to their name, and everyone thought they were gonna be the next Internet giant. The same exact pattern, and it worked very well, at one, like 80, 90 percent of the time. Sometimes it’s didn’t work because they price it in, but the same exact pattern just happened last year with Bitcoin and cryptocurrency, when company said, oh, we’re getting into crypto, and it was so hot.

14:43 The exact same pattern, and I was just like, nothing has changed in 20 years because it’s human psychology. So can you, can you recognize the patterns? This is why Finance, like it doesn’t teach you anything. I had one of my students, Jackie, tweeted me yesterday, you may be eleven thousand dollars, and he skipped school, and he said, you know, my teachers teach me nothing about this. My dad is probably gonna be angry that I skip school, but I made $11,000 because I recognize patterns.

15:07 Like, I would rather people be experts at Tetris or some like pattern recognition game than knowing about all the deep, dark financials and stuff like that. If that doesn’t help you, it doesn’t matter. An individual trading account, maybe if you’re managing a billion-dollar hedge fund and you have all these different positions, or for Finance or whatever, but individuals who have a few thousand dollars, they need to think very differently. You can be meticulous.

15:29 You can be like a sniper. I say, like, trade like a sniper. Where you have a small account, most people who have just a small account, they look at it like it’s a bad thing. Like, oh, I can’t wait ’til I have, you know, a million dollars, a billion dollars, and I can allocate to different things, and I have seven longs and three shorts. And for me, I like trading with a small account because I can make a few hundred dollars or a few thousand dollars a day, and then I step away.

15:49 I literally am done for the day. Right now, so you’re helping me stay away, because I’m a degenerate gambler too. I just have learned the rules, and I know this isn’t necessarily like the basics of trading like you wanted, but that’s what this is. So I love how you say you’re a degenerate gambler, and a lot of your students are. Yeah, well, let’s be honest, a lot of humans are, right?

16:06 We love to take a punt a lot. We all are. Everybody wants that, you know, we’re alive. Like, life is exciting. If you’re not excited about it, then like it’s just boring.

16:15 So for me, I do like the excitement of making money, but again, 20 years of trading now has taught me rules. Like, I might make money some trades, but it’s too risky. Like, what if I can’t control my risk every time you put your money into the market, anything can happen. You can lose a lot, so if you’re not disciplined with rule number one, cutting losses quickly, it can go away like most traders. Yeah, so it’s like mental discipline, you know.

16:39 You said that, the going to war. I had Jocko Willink, U.S. Navy SEAL. Yeah, and if you asked him about his time in Ramadi in Iraq with his troop, I bet it’s all about mental discipline, because he said, look, sometimes you’re taking fire from everywhere. You might be the big bad Navy SEALs from America, but you fall back.

16:55 Yeah, you know, it’s constant about discipline or your guys get killed. It’s all risk reward, right? Like, you might see the end goal where you’re like, oh my god, this is this big shiny goal at the end, but then it’s just not worth the risk, because to get there, you might lose everything or you might blow yourself up. So for me, I like taking. I make baseball analogies.

17:13 I say I like taking singles instead of going for home runs. Like, there’s ways where I can make more money, but I might risk losing everything, and I can’t risk that. Like, for me, I want to build my account gradually, block by block, and sometimes I have to take one step backwards, like with a small loss, but I never want to go all in. I never want to use leverage. You know, people say, oh, I’m so sure of this, and they go all in, and it’s, what is that bad Kevin Bacon movie from the 1980s where he loses everything in the stock market.

17:41 He’s an options trader, and then he becomes like a bike messenger, and then there’s bike messenger wars. Sounds familiar. This is what happens. He goes all in. Never go all in.

17:50 You know, then Kevin Bacon gets to a baseball analogy. There’s that movie Moneyball. Yeah, just interesting, and if people haven’t seen it, it’s a great movie. Think Brad Pitt’s in there and the other dude, that big, the fat dude, whatever. He’s doing to help.

17:59 Yeah, Jonah Hill. It’s a true story, and and that’s all about the singles. That’s all about playing the numbers so you can win consistently and get to the World Series as opposed to trying for the flashy moves. Yeah, the big grand slams. And it’s also analyzing everything a little differently.

18:15 Like, people before that would just look at hits, like, okay, what’s his batting average? But this is like, what if the fielder made a really good play, but it should have been a hit, right? So what does that count as? Like, you can’t control what the fielder does, but you can see a little more to the stats, and that’s basically what trading is. You’re looking at the stats a little more than just what is a company’s revenue, what is the growth rate, what is the ratio?

18:37 Very basic stuff, which long-term investors love, but trading, you have to look a little more yet behind the plate, and it is actually good. Like value investors, you know, there’s nothing wrong with value investing. It works over decades, but they don’t understand how, like, a company like Instagram got bought out by Facebook for 1 billion dollars. Value investors cried. They said, no, Instagram has no business whatsoever.

18:58 They have like 12 employees. That’s a terrible play. Now Instagram is worth 50, 60, 70 billion, depending on who you ask. It was one of the best acquisitions of all time, but they bought it when there was no business, but they had a lot of users and they had a popular app, and Facebook could envision, you know, building revenue on top of that. So the world has changed a little bit, and you have to think what can be valued in the future, as opposed to just right now.

19:20 A lot of companies report good earnings right now, and you’re like, oh yes, it’s totally just reported record earnings, and then the stock drops. You’re like, but they reported record earnings, but maybe on the conference call they said, we’re doing well now, but we have two new competitors, or we’re doing well now, but you know, we have to ramp up research and development costs. So the world in the stock market and Finance is very forward-thinking, and you have to be.

19:40 Yeah, let’s talk about cutting losses, because you, you kind of went over it briefly. That’s such an important concept, and this is that, you know, Tim was just talking on the wins you kind of lock in and the losses you make small. Yeah, and, and first of all, for anybody watching, it’s actually not human to cut losses. It’s most, it’s our intuitive, right? Most humans buy high and sell low, and so they invest and when it starts going down, they think up triple, a double, double triple up, because I don’t want to take a loss.

20:05 When it starts going up, they think, I’ll wait, I’ll wait, I’ll wait for to get more. So it’s fear and greed. Yeah, and the actual, the natural human tendency is to go big on your losses and cut your gains. Yeah, and so you actually have to be counterintuitive. 100% counterintuitive.

20:19 So this is why learning lessons, and you know, practicing, like when people say, oh, I want to get into trading, I say, whoa, slow your roll. First of all, study first, and then let’s say you want to start with like ten thousand. Let’s start with two thousand instead, because you’re probably going to lose in the beginning because you have to learn these weird rules. Like all the best traders I know are the weirdest people that you will ever meet. They can barely talk.

20:39 They’re like robots. Some of my top students, I think they might be clones sent back from me in the future. I’ve thrown this theory out there. What do you think about this? In the future, if theoretically I’m a successful teacher, and I’m richer, and I have more students, and time travel is possible in cloning as possible, would it not be a good idea to send a clone and send somebody back in time to now to become a good student, to follow the rules, to prove to people what happens when you follow the rules?

21:04 My top student has turned fifteen hundred to eight million dollars. I think he’s a robot. I don’t think he’s a person, because he follows these counterintuitive rules so well. I can’t even do it. He’s made more than me.

21:14 Wow, ’cause it’s that discipline. He’s so good at a lack of emotion. Completely. No, it’s, I mean, he’s had big losses. He learned.

21:22 Okay, so he wasn’t perfect in the beginning. He had like two hundred thousand dollar losses, a hundred thousand dollar losses, but every time you have a big loss, you learn what not to do. You don’t want that feeling. I’ve had a five hundred thousand dollar loss. I turned to drinking.

21:33 It was splashed all over the headlines. It was terrible. I never want that again, and that forced me to become more disciplined. Now I have all these students in social media. I don’t want to look like a jackass and break my own rules that I’m teaching, right?

21:44 So I think social media and transparency can help, because the more people who follow you, like you want to be the best version of you on social media. So it forces you to be good. If I share everything, which I do, I share every single trade publicly. You know, people can judge me, so I’m like, oh god, I gotta look good. Like that.

22:01 That keeps me on my best behavior. Here, group is holding you accountable to be your best self. That’s, and also that’s amazing, and I think it’s fantastic, and I think more people should do that. They’re scared to, like, share everything online. I get it.

22:11 Like, sometimes I over share, but I think that in terms of trading or any endeavor where you need discipline, like the more people watching you, it forces you to be better. Let’s talk a bit about your story, and then let’s talk a bit more about the penny stocks as well, because we mentioned commodities. There’s bonds, there’s interest rates, there’s crypto, and you know, baseball cards. I’ve traded baseball cards when I grew up. There you go, like, people to understand you can trade anything.

22:35 You can buy her something. We will trade homes. Maybe first we talk about this concept of liquidity. Reserve Rick, and I want to hear about your story. So liquidity is a word that gets thrown around a lot in trading circles, and I would mean, let me try to define it, and maybe you can define this, but you know, for me, I traded two of them, like most liquid instruments when I was on Wall Street.

22:53 One was the bond future on Chicago Board of Trade. There’s a massive fixed income future that was just easy to get it at in and out in size. It constantly had a lot of volume trading that probably Deutsche, our dollar at the time was another big one, and maybe like S&P 500, and then there was always a price. There was always size where you could get in and get out. You could put on big positions.

23:12 It didn’t gap, etc. um, am I right without difference in my own? And I’m on the opposite side of this. You’re dead on. I’m trading the most illiquid stuff.

23:22 This is why Wall Street and everyone says stay away from penny stocks. There’s no liquidity. Liquidity is basically like, how easy can you get in and out? This is my five hundred thousand dollar loss. I didn’t understand liquidity early on of my career.

23:33 I was batting a thousand. I was winning every time. I was like, let’s go bigger, let’s go bigger, and I eventually got into this illiquid penny stock that no matter what I could do, I couldn’t get out of it because there wasn’t enough trading volume. So you’re trading the most liquid stuff every single trader in the world can trade it. You can get in and out.

23:48 All your money times like a million. If you’re trading like the S&P futures, are some of this stuff. When penny stocks, some days I don’t even trade because there’s no hot play in play right now. Like sometimes I need a hot stock. I need a few million shares traded so I can take like five thousand shares, ten thousand share positions.

24:06 I never want to be more than one percent of the daily volume. That’s what liquidity is. Like how much is being traded. Like housing is very illiquid, right? Like that’s good when housing is good, but when housing crashes, you can’t just dump a $500,000 house very easily.

24:20 There’s no liquidity. Yes, say you had a five bedroom house in Las Vegas in oh seven, oh eight, and you’re like, oh, it’s worth a quarter of a million dollars, and it’s like, okay, go try to sell it right now. There’s no liquidity. Nobody wants to buy it. It’s like, well, it’s my 450 or hundred thousand.

24:33 Well, maybe nobody would crash, but guess what? Right now maybe it’s worth nothing. Yeah, you can’t sell it. Correct. That’s hard for people to understand.

24:40 I mean, that’s its supply and demand. So everything is based on an auction, right? So like, if there’s, like, let’s say there’s a painting. Forget about stocks or housing. Let’s say there’s a painting, and you don’t know if the painting is good or bad.

24:51 You just know that this painting, for whatever reason, let’s say it’s controversial. It’s been written up. Like everyone’s judging this painting because of all the press. Now theoretically it’s worth more. If you look at Banksy’s, you know, Banksy, have you seen his stunt where like the painting guys read it, and someone had just bought it, and right when they got bought, it’s shredded.

25:08 And now if you look at the articles, like that painting that has been shredded, even like the shredded state is worth a lot because of all the press. You, oh, that’s the shredded paint, and the YouTube video as well. Yeah, so it became an instant classic, became performance art. So if you actually look at, there’s a great book called Hit Makers, which everybody should read, and it’s the history of what, what creates a hit. Like, if you look at a lot of the top painters, right?

25:32 Like Monet, like all these Impressionists that are in the museum’s, are they better painters than other painters at the time? No, they were actually embroiled in a whole, it was a whole present devic alike, where it was messed up that this one rich guy died. It’s a long story. It’s one rich guy died, and he left his entire collection to the museum. The museum didn’t want the collection because there’s all these unknown artists, and it became a big court battle written about by the press for several years.

25:58 When they finally accepted these painters into the museum, the painters has gotten very famous. So now the paintings are better, and if you actually look at, like, the technical skills of many of the most famous painters, they’re not better than some of the worthless paint was the going viral of the time. Exactly right. So if something goes viral, it’s all perception. Is reality literally, writers, we’re doing this.

26:16 Uber just IPO’d, and this has been one of the hottest companies, one of the best private startups in the world, and then it just became a stock, and I’m gonna check it real say because I just I’m obsessed with it, but like, literally, it’s not doing well now that it’s a stock, and people are like, what’s going on? Is there something? Is there something that we didn’t see before? It doesn’t matter. It’s whatever the market will set for it, right?

26:37 You show you’re obsessed with numbers. All right, I’ll come back to the stock. I’m making that over. I’m looking at who I stopped. You look it up now.

26:43 That’s right. I’m looking at it. No, but look at you right now load is long. Damn it, where’s the service in here? I think you’re on airplane mode.

26:49 I turn it off. Is this a destructive habit of constantly having to check? That do you have to kind of check your something? This is a curiosity I’m not trading Uber. For me, this is just, I need you back here it’s not loading.

27:02 Okay, so let’s just, I am, I recognize that I’m a degenerate gambler. I’m like an alcoholic bartender serving my clients drinks, but I recognize the rules that I’ve put in place to keep me in my box. Like, I’m not gonna trade, right? We’re not gonna trade on it, but you’re gonna watch. I’m not tempted to trade it at all.

27:18 For me, this is like gossip, right? And you made your two grand for the day. It keeps the corporate job away. Correct? And now you’re fine.

27:24 That’s discipline. Yes, and one of the you earlier, you told me how you coulda made more. Couple trades, and yet you’re over it emotionally. Correct? That would take most people years.

27:33 Did take me years. I’ve been doing this 20 years. Early on, like, you know, kick yourself, and I would go through your head for days, weeks. Correct? I like Sportsman’s Guide.

27:41 I made like 20 or 30 percent in the thing tripled, and I was like, why can’t I hold longer? So I actually gravitated towards buying on Fridays and selling on Mondays. This is how crazy I am, because the stock market is closed, so I can’t do anything about it. And one of my biggest trades when I was a freshman in college, I made $100,000 holding a stock from Friday to Monday, and I still sold too soon. It would have been 200,000 if I had held till Tuesday.

28:04 But I look for these kinds of instances like on that Friday trade, I bought it. The stock said, look, they put out a press release. We’re gonna be on TV on Sunday, right? And they said they had, back then, cellphones were very fuzzy. There wasn’t very good technology.

28:19 They said that they had a technology that would clear up all the fuzziness with cell phones back then. There were no expose zones. In 1999, the stock market was going crazy. 99 2000. On TV, they, of course, they’re probably going to hype up the technology.

28:31 Journalists aren’t really like forensic journalists, especially back then. They were just going with the times, right? So they put out a press release. Look, we did this interview last week. It’s finally gonna air on Sunday.

28:42 So I was like, oh my god, this is amazing. Like, the news is already out, but a lot of idiots are gonna watch TV. They don’t check the press releases. So I bought the stock at 17. I put at that time, I was putting 3/4 of my account into one play.

28:53 Bad, bad, bad, way too aggressive, but I didn’t know any better. Monday, the TV show air. Fantastic on Sunday. Monday, the stock gapped up, and I made a hundred grand, and I took my whole dorm out to dinner and that was a crazy. I wasn’t crazy day.

29:06 That’s where you came up with this weekend strategy. That way I came up with a weekend strategy. That one trade, and then I started looking for these inefficiencies, because a lot of people hear about stocks on Saturday or Sunday. The stock market is closed, right? So they have to put in their buy orders on Monday.

29:20 That creates a gap up on Monday mornings, because it’s massive demand. You talk about what is liquidity, what is volatility? they go hand in hand. Liquidity is how much can a stock trade, right? Like millions of shares, maybe billions of shares if you’re trading certain markets, right?

29:34 If you’re looking at volatility, does the stock actually move like that? Stock that was on TV over the weekend. The stock doubled over the weekend because everyone saw it on TV, and they said, I want to buy it, even though the technology flamed out and it didn’t work eventually, but that’s massively volatile, and it goes in the hand with it being illiquid. Correct? So you say, I’m gonna go trade this penny stock, illiquid instrument, because with all of its drawbacks of not having liquidity, there’s also a bunch of upsides, because if I understand how it works and understand that it doesn’t have these things in gap.

30:05 You can take advantage, and it’s not massive liquidity, but they are liquid. I don’t trade in liquid penny stocks. Like I said, I lost 500 grand on the illiquid stock I couldn’t get out of, so again, I don’t want to be more than one percent of the volume on the day. So if I have, like, let’s say 10,000 shares, and it trades a million shares on the day, that’s plenty liquid. I don’t want to trade 500,000 shares and the volume be like 600,000 shares, then I’m the whole market.

30:27 So you have to just kind of, like, stay in your lane, and we need to know that. All right, let’s go back to the bar mitzvah. You get the cash up from the parents and the relatives and stuff. Why would you then go and start investing? Because I tried that when I was a kid.

30:40 That’s like no-win for me. There, when I see, so the markets were, I mean, my money was just sitting in Series EE bonds for like six years. Like, you’re a bum. It’s when you’re third elements. Yeah, yeah, like government bonds, those doing nothing.

30:51 I was a tennis player. I was playing tennis every day. Me, bones. Correct? The coupon is nothing.

30:56 It’s garbage. Nothing, but that’s what I put it in for six years. I was a tennis player. I got injured I had Tommy John surgery. I don’t know if you know Tommy John surgery.

31:03 So they take something out of your other arm and they put it in this arm. Shouldn’t I give me coffee? I feel like I’m talking faster than they eat doing great. But so I’m walking around school like Robocop after my surgery, and I can’t do anything. I’m already into college early admission, and so my parents gave me, controlled by bar mitzvah money.

31:18 They thought I would lose at all. They thought that it would be a good lesson. I give the kid the 12 grand, he’ll blow it in the stock market. Raid well, I didn’t. Again, I wasn’t a trader at first.

31:27 I invested in Viacom, Supercuts and Business Objects. These were like my first three stocks. It might count. One month, we go like, twelve thousand, one hundred, then like eleven thousand nine hundred, and I was like, this is so boring, and I’m sitting there with two casts, but I could still type, and this was ’99. The stock market is going crazy.

31:46 I gravitated towards tech stocks, but I couldn’t afford the big tech stocks at the time, which was Netscape and Yahoo, so I was like, the prices were too high. So I was like, what else is there? So there were upcoming little Internet companies, and I was like, well, if Yahoo and Netscape, I mean, back then they weren’t really anything. They just had hype. Like, they were being used by a lot, but they didn’t have any revenue.

32:04 So it’s like, well, if these websites are valued highly, what about the smaller websites that are growing? And so I invested in, like, this company called NetTaxi, which was like an early Facebook in the stock. You know, went up seven times. I again, I sold too soon. I took my twenty, thirty percent.

32:17 Then I had the dot-com strategy. So I gravitated towards, how can I grow my twelve thousand dollar account? Senior year of high school, twelve thousand became a hundred thousand. Freshman year in college, I made nearly a million. So I just got addicted to finding in tinkering to see what works.

32:33 That’s what people need to do if they know nothing about trading or the markets. Tinker, test around. Like, put aside a thousand dollars that you can lose and play with it. In tests, and see different strategies. Try you know, trading art, trade baseball cards, trade stocks, whatever you can do, but start to look, because every single industry that I found has these little inefficiencies that most people glaze over because they don’t care.

32:56 Like with penny stocks, most people don’t care because they think the money is too small. Like, oh, they made five hundred on the day. You made two thousand like in my whole career, I’ve made a few million dollars. That’s nothing in the game that you were playing. You can make a few million dollars in one day.

33:08 Yeah, so it’s just recognizing that the good news is you have, make a few million dollars, you’re set. Like, I have a pretty good life. Yeah, and I was trading the bank’s money, so yeah, I mean, I think our P&L that year was like a hundred million dollars, right? This is the bank, when other people’s money or your money. Yeah, that’s the atom.

33:24 It’s a bunch of people on the desk, and you got to pay the sales force, and by the time you get into the meeting at the end of the year, you’re walking away with you know. So that’s good, because without them you wouldn’t have money to trade, and most people don’t have money to trade. They’re like, oh, I would like to make two thousand dollars in a day, but I don’t have that money. So it’s nice that I’ve made two thousand dollars today. But how do people get started?

33:42 Like, if you have a small account, you’re not gonna make two thousand dollars in a day, so I try to teach my students how do you make a hundred dollars in a day, and then you can size up later once you have experience, once you have a bigger account. Like today, I bought three thousand shares of this stock. You know, if I wanted to go bigger, I could have. I donate all my trading profits to charity because I just want to show the process. These days, but you know, you could get bigger with a bigger account once you have experience, but you have to learn the process.

34:07 That’s the key that I really want to get people to. Like a martial arts. It’s almost like a martial art, you have to get a black belt or a purple belt before you can really go out there and compete and have a chance to survive. And everyone is different, and it’s a moving target, so just to make people understand that this isn’t as easy as they think it is. Like, the market is always changing.

34:25 Sometimes I have a perfect pattern, and if the market is different, at the market’s bad, that pattern is irrelevant. Like, Uber was a very hot company, but for whatever reason the IPO market isn’t good right now. Lyft IPO didn’t do well, so now Uber is dead in the water, which is a shock to everybody. It’s not an exact science, and people have problems with that. They want it to be an exact science.

34:44 Like, you learn mathematics. Like, who’s the best at solving this formula? Even, you know, martial arts. Like, you, you learn specific moves and specific stuff that always works. With the stock market, you have to be willing to throw out your entire thesis, which is tough.

34:57 It’s exciting. All right, tell me what a penny stock is. This is like a company with kind of a small market cap. They can’t get Goldman Sachs to do their IPO. They can’t get the New York Stock Exchange to list them, so they go to these kind of smaller exchanges, and like, what is the deal with these things?

35:10 And sometimes they’re scams, and how does this work? And sometimes you’re shorting the stock. Love for people to understand what that is. Yeah, so they’re very small companies. That’s basically what you have to do.

35:20 You have to understand that they’re kind of like long shots. Like, if you ever go to the horse races, right? They’re like 50 to 1 long shots. Like, no one expects them really to win the race, but every now and then they do. They have one or two products.

35:31 They might have some revenue, very little in the way of cash, but their stocks, because they’re trying to raise money, the higher the stock price, then theoretically they can do a financing. Like Uber just raised billions of dollars. They did a massive IPO, which is an initial public offering. They had all these banks. Everyone’s clamoring for them because they’re a gigantic company, even though they’re still losing billions of dollars.

35:50 But that’s another share, right? Yeah, these small companies don’t have revenues. They have no cash. They just have pipe dreams. They have hopes, like, oh, we have this gold mine in Ecuador.

35:59 We, we found this great oil potential discovery down in Colombia, and many of them are scams, but many of them also have some potential. Like, they’re diamonds in the rough. Like, I like buying companies that, you know, announce big news. I’m in this company. You’re gonna laugh.

36:16 Are you tuck in your book here? And maybe if you could tell the book well, no. So I’ll tell you this. So this is actually a funny story. Right now, as we’re filming, I have zero positions.

36:25 I’d like to get in and out. I trade like a sniper, but I’ll tell you a story about spider silk. Have you heard of spider silk? I haven’t. So picture, like, all these spiders spinning little silk, right?

36:36 The ticker is KBLB. I’ve already sold it. I actually underestimated it. I bought it at eight cents. It was already up from six cents on the day, so it was up, like, thirty percent on the day.

36:45 They announced a deal with Polartec. Polartec is this big multi-billion dollar company, for you know, nice sportswear. They’re kind of like, you know, what’s a good company? They’re kind of like Patagonia. Yeah, no, Patagonia.

36:58 Yeah, like The North Face, right? So Polartec CEO in the press releases just a few weeks ago, and they said this spider silk has the potential to be like the next big thing, and I’m like, are you kidding me? Like, the spider silk has been around for years. The company has never made it. You know, they’ve always been a pipe dream.

37:13 Again, they have no cash, no revenues, but they have this potential spider silk. But then Polartec CEO goes on public record saying this, so the stock is up. I buy it. I’m all excited. I’m like, this is amazing.

37:24 I buy the stock. The next day, it does nothing. I sell. I make 3 grand because I was right a little bit, but I was disappointed. I was like, I had to throw out my thesis, cuz even though I was excited about the product, I was excited about the press release.

37:35 The market didn’t agree, and it just didn’t do much. 8 days later, the thing starts spiking. I don’t know, some hedge fund wrote about it, or someone saw it, whatever. And now the thing, right now, is we’re talking, is at 35 cents, and I sold it a freaking, like, nine, eight, or nine cents a share. So it did triple, but not in the timeframe that I wanted, right?

37:55 And that’s the in exact science behind this. So that’s a good example. The good news also is that it’s probably gonna crash eventually. They’re probably gonna screw up in some way. I expect the worst out of all these companies.

38:07 What’s the average market cap of these companies, and what does market cap mean for people that don’t know? Yeah, so this company is worth about 250 million dollars, all on a pipe dream for their spider silk. So if you take all the shares outstanding times the share price, you kind of got the market cap, which is roughly what the company is worth. Yeah, if you know, if someone’s willing to buy it, but I never really are like, you have to remember most antenna stars go out of business.

38:28 It’s kind of like knowing the end of the movie, and you can work your way back. Like, you know pretty much that this company’s going to fail, and then one company survives or thrives, okay, it’s so rare. So I just expect the worst out of all of them. Either management will screw it up, the the product will screw up. Like, I know it’s a cynical way of looking at it, but I’ve seen tens of thousands of companies come and go.

38:49 The good news is that they’re volatile. They don’t just all fold, at all, just give up. They try to spike. When the stocks do spike, the companies do financings. They try to raise money.

38:58 There’s news like that, they have news like that, rate. So a trader just wants a volatile stock, correct? Right, that has some liquidity. Yes, that’s what you need. I mean, this thing trades 50,100 million shares a day.

39:08 So this is a very liquid example. Okay, you know, I had one of my buddies as a distressed debt trader in New York City, had a headphone there, and he’s kind of like, you, he’s just always bearish. He’s like, these companies are gonna go fail. They’re gonna fail. I mean, again, the $500,000 loss that I had, that I keep thinking about, it was an illiquid stock, and I believed in the technology.

39:26 This is the problem. Why most people hate penny stocks is because they believe they’d be even the company, and then the accompanying crashes, and they feel gypped. And if you see, like, The Wolf of Wall Street, like, they’re usually promoted Jordan Belfort was sitting there two days ago. There you go. So you know, if you want to learn to be a career criminal, learn how to be it from Jordan.

39:44 What did we learn from watching The Wolf of Wall Street? Like, what do you see? Oh, he would argue you didn’t trade penny stocks in the, in the later day. He, he marketed. I mean, he’s a fantastic marketer.

39:54 Penny stocks are marketed as something amazing to the financially naive because they’re very low price, so people can put in a few thousand dollars, and then they usually get taken advantage of. They don’t tell them the odds are like a million to one that it’s going to succeed. So for me, I’m thankful for Jordan Belfort, because not only did he create penny stock pumps, but he also created this entire industry with idiots who believe in these companies.

40:18 Like, he’s a fantastic marketer, and because of his marketing, and because of how much bitterness there is with these penny stocks, like, they spiked and they crash, so he created this entire pump and dump cycle. What is pump and dump for people that don’t know? So this is when a company announces good news. They pump their stock price up. Like, we just found gold, is amazing, and the stock goes up from 10 cents to, let’s say, $1, and they put out another press release.

40:43 The gold is even more than we thought, double, then the stock goes from one to five dollars, then the company does a financing. They say, well, we found all this gold, but now we need to raise money to actually take it out of the ground, so we’re raising twenty million dollars, and the stock is, that, let’s say, five dollars, because they pumped it up with these press releases, and then they do a financing at, let’s say, two dollars a share. So it’s a toxic financing, nice little fifty, sixty percent discount for whoever’s buying it.

41:07 Then the stock crashes back to two dollars, then it usually crashes even more as the insiders start to sell, and they say, well, maybe there wasn’t that much gold. Maybe our tests were a little ambitious. Then it crashes back down to ten cents. So they pumped themselves up with the press, they try to get as much money as they can with the financings, either to try to, like, dig the gold, or just pay the management and pretend to dig the gold. And sometimes the brokers and people are taking positions along the way, buying on the way up and then selling it at the highs.

41:34 That’s suckers to their clients. Yeah, so then they’re making money on the pump and dump. Everybody goes in with the story. They cheerlead it, cuz it’s exciting. It’s fun to be an investor in something like, yeah, we’re creating something.

41:45 So like this spider silk, I laughs. I don’t think this spider silk thing is gonna work, but the fact that Polartec, this multi-billion dollar company, is giving it credibility. It’s not the average pump and dump that doesn’t usually happen. Usually it’s just the company announcing it. They put out a press release, they get an analyst.

42:00 You’ll, you’ll laugh at this, because you brought up Goldman Sachs. There’s a penny stock analyst group called Goldman Research. They’re not Goldman Sachs. They’re just called Goldman Research, and they pump up these penny stocks, and they put these ridiculous, like, four to five times price targets, and then all the message boards start saying, Goldman put out a price target, and I’m like, if not the same Goldman. And then deep down in the disclaimers, Goldman says, we’ve been compensated three hundred thousand dollars, or you know, we have six million shares of the stock.

42:27 So they’re conflicted. They’re not a normal analyst. That’s what a lot of pump and dumps do. The brokers, the analysts, the newsletters, the companies, they’re all in it to get the stock up, and they market themselves to the financially naive. So for me, I expose this, and then you can also short sell, so you can actually bet against companies when they’re up, and you take a negative position, which freaks people out, cuz you’re like, wait, what’s, playing the short sell for people?

42:50 Because most people still have a hard time understanding that you can sell something when you don’t own it. Correct? So you’re basically taking out a loan from your broker. So instead of buying a thousand you’re basically buying negative a thousand. Chairs, and a negative times a negative is a positive.

43:01 So let’s say you buy negative a thousand shares at $5 a share, right? Negative a thousand times five, that $5 is still a $5,000 investment, but then you buy it at five, but then you sell it at two, right? So it’s a reverse trade, so you’re taking a negative position, or you could say you sell. Hottelet bottom, yes, and Biol. Okay, right?

43:20 I like to say buying negative positions, just cuz it gets people like, when you say you sell a negative position, people are like, selling is like the exiting. Okay, right? So you’re buying a negative position, and then you’re exiting later on. So let’s say you, whatever, you enter the position, whether you buy or sell, whatever you want to call it, you enter the position at five, and you exit the position at two, but because you have a negative position, negative three times negative a thousand is still positive three thousand dollars, right?

43:45 So right now, if you thought that Uber was an entire scam, you would short the stock at forty five for its IPO price, and you don’t have to have the stock at all. You go and you borrow it, basically. You borrow it from your broker. He sells it in the market, and then if it goes up, you lose, and you could take it out on whatever margin you have. If it goes really, you have unlimited downside, technically, right?

44:04 Come on, what if a stock goes to like six hundred? So this is the thing with short selling. Like, if you buy a stock, yet three dollars, we’re sharing it goes to zero. Okay, you lost your three dollars a share. But what if you’re shorting a stock at three dollars, and it goes up to ten dollars?

44:16 Now you’re down seven, so you’re down more than double what you put in, and you can actually owe your broker, you know, and then collection agencies come after you. Like, it’s, you can lose more than you have in your account. So it’s kind of scary, although, follow rule number one, cut losses quickly, it doesn’t happen. Yeah, now you talk about all these scams and all this stuff, where’s the SEC? Are they protecting us from this?

44:36 I mean, they got Jordan, but it took them five or six years. I mean, shouldn’t they be looking after this Goldman Research and all this time? I mean, they’re just it’s just small-time money. So like, the SEC follows big scams, big money, or they try to. The SEC is also very underfunded, so it takes them a while to find it.

44:52 Like, they only find out about these scams when enough people complain, and when enough people complain, like, that’s when they get involved. So the scam needs to already happen, and again, it’s not illegal to put out, you know, some positive analyst reports, as long as you put the legal disclaimer on the bottom saying we’ve been compensated. It’s on the person, the investor, to read the disclaimer, but sadly most people don’t. They just read the big headlines, and they don’t read the small print at the bottom.

45:17 One of my basic lessons: if you ignore everything I say, whatever press release you get, whatever mailer you get in the mail, always look at the disclaimer, because the disclaimer is legally required, and all of these promoters are quasi promoters. You know, there might not be The Wolf of Wall Street anymore, but there’s lots of little wannabe Wolf of Wall Street’s. You know, they’re like little, little baby wolves, and you got to feed them, right? But they put little disclaimers on them.

45:40 They’re just taking advantage of the financially naive. That’s the problem. You know, I watched the movie after Jordan came in here, and I’ll be honest, when the movie first came out, I couldn’t really watch it, because it’s not the Wall Street I knew. Yeah, these were a bunch of, you know, the movie is a scam in itself. Did you hear about that?

45:55 It was funded by illegal, like, Malaysian money. Yeah, yeah, the crazy scam in that too. Yes, the way that they got the 50 million. Yeah, of course it is, right? Yeah, that makes sense, but it was like, you know, these guys out in Long Island that were basically salespeople, so they were pushing these, you know, penny stocks, dollar stocks, down people’s throats through hype, and it was this whole thing.

46:12 I was down on Wall Street, you know, doing interest rate derivatives, and they, it was a completely different thing, and I didn’t know anybody that, like, did all that crazy stuff. So when I first saw, they can get it, but you know, I did watch it, so I saw what he did, and he basically pumped these things up and marketed, and got a lot of liquidity and awareness for these things that, you know, trade. So there was something there. They created the market.

46:30 Um, you know, I mean, even like the shoemaker was the Steve Madden, st man went to jail, right, because he was complicit in the whole scheme. Um, they create these pumps, but there’s always gonna be these little sketchy companies that need liquidity, that need pumping. So for me, I’d rather just educate people, so that, you know, if you get the phone call like Jordan Belfort just did, you know, boiler room type stuff. It’s not as much boiler room anymore.

46:53 Now it’s on social media, and you get email promotions. But instead of trying to shut that down, because I think there’s always going to be a new scam or a new promoter, I would rather educate the audience so that if you do get the call, you kind of smirk and you laugh, and you’re like, oh, what, what is this tip? And you write it down. So I always encourage people, if you hear a tip and you see, like, the disclaimer from, like, Goldman Research or anybody like this, you actually look at the stock.

47:15 You don’t say, oh my god, it’s a scam. You say, okay, here’s an opportunity. Let’s see how high it goes, and let me try to wait for the short, because it is going to end. The beautiful thing about this is that, you know, with stocks like Google or Amazon, you don’t know who’s gonna win the industry wars in the next few years. With these pumps, you know that they’re being promoted, but only for a very short time period.

47:36 When the money runs out from the promotion, it’s over, and then it’s like a jet plane falling out of the sky with no fuel, and they crash forty, fifty, ninety percent in one or two days, and it’s pretty crazy to watch. Wow, well, I call it, like, sometimes, like, short-selling surfing. Like, sometimes I’m short, and part of the reason why I don’t just run a hedge fund anymore and just short sale, it’s not a very liquid strategy, right? Like, I can’t always short a million shares.

48:00 I, in fact, I don’t think I can’t remember the last time there were a million shares available to short, because you have to take your loan out from your broker. The broker might have a few thousand shares, so that’s why for me it’s better to teach. Individuals can short a thousand, two thousand shares, and you can, you kind of feel like you’re surfing, right? Like you’re watching it collapse. There’s no more promotion.

48:19 That promotion money has crashed, and I actually have some live YouTube videos where I’m like, oh my god, I’m short three thousand shares at like three dollars. In the stock, by the end of the thirty-minute videos, like at a dollar 20. That’s no news. It just crashes because there’s no more promotion, and then you have stop losses get taken out. I’m a fan of mixed martial arts, and when I watch a fighter on, like, a ten-fight winning streak, and you were at, you were in Vegas watching Conor McGregor beat Jose Aldo.

48:44 So you know what I’m talking about. Yeah, I always watch them when they have their first loss, and I see, how are they gonna come back? I saw Conor when he got choked out by Nate Diaz. How does he come back? Because a lot of time that’s hard.

48:54 You took a big loss, half a million dollars, a few years into your trading career, what what happened to you emotionally, and what did you had, what happened next? Um, I mean, I drank a lot. It was splashed all over the, the newspapers. I mean, New York Post said, like, party’s over for a hedge fund king. I was never a king.

49:11 I had a few million dollars, but for the press, they wanted to make it big. And before this, you had been flashing Lamborghinis and all that? I wasn’t flashing, but I was trying to show my hedge fund, like, my hedge fund was like top rated. I ended up losing like a third of my hedge fund, which in the grand scheme of things was the best thing that ever happened to me, but at the time, when you lose a third in one year, it’s like you blow up. And then to make matters worse, not only did I lose a third, and weren’t like, asking for their money back.

49:35 Like, I was still up over four years because of the previous three years. But I closed it down, and I got into teaching. And so people are like, what, what do you do? You’re leaving the hedge fund world, which is a very legitimate big world, and you’re getting into, like, the snake oil world of, like, teaching. Like, have you lost your mind?

49:50 If you lost all your money, obviously that’s the only reason that you do this. But what I saw is that that big loss taught me the rules that I now teach. So it was the best thing ever, because before that loss, I didn’t have my risk management. I might have been winning a lot, but I was due for a big loss. Ain’t like, I didn’t know how to cut losses quickly.

50:06 I didn’t know the risks of illiquid stocks. It completed my education, and because of that, it made me a better teacher, made me a better trader. And I got into teaching. Reuters had the headline, failed hedge fund manager tries again, on the internet, and I talked to her for like four hours. I explained everything.

50:21 I was like, no, this was an illiquid stock. I ignored my trading rules. I didn’t know how important they were. She’s like, yeah, yeah, I get it, and I was like, she really gets it. Then she wrote this article, and I was like, she’d get it, but the press, it, yeah, but it was good because it really, you know, knocked me down publicly.

50:37 It crushed my ego, which was fantastic. Like, if you have a big ego, the market will humble you, and the market humbled me. The press humbled me, and it put me into this perfect position. I went back to $12,000, not because that was all the money I had left, but because I wanted to repeat my feet, right? And right limits for money right around that time.

50:56 Like, when you fall down, like, what do you do? You go back to your roots. So I still had like four hundred thousand dollars to my name, but I was like, no, I’m gonna go back to twelve thousand, just trading with this. I didn’t know if I would be successful. I was like, okay, now I know my rules a little better.

51:07 Let me do this. At the same time, there’s a small startup called Covestor that had started, and they could basically verify your trade, so I uploaded my brokerage information to them, and they ranked all these traders, and I became the number one ranked trader out of 60,000. I grew my 12,000 roughly a quarter of a million dollars over two years, and they tracked every trade to make sure that I was telling the truth, and I showed it in video lessons and blog posts, and again, like 250,000 dollars over two years.

51:33 It’s not that big money, but when you start with just 12,000, it’s very good. Yeah, and the transparency, that’s, that’s something brand new to the Internet in the history of stock trading. You know, there’s never been transparency out there, so this is interesting, and that you chose to do it. I mean, for everybody to see every trade. It’s like them seeing when you’re naked.

51:49 Why don’t you present? And that’s the gift in the curse, because again, I was, I was all kinds of messed up in the head after that loss. Like, picture, like, winning every single time, thinking you’re the best trader in the world, and then getting knocked down, like, big-time. And then I was on a reality show while this was happening, so I was drunk in every episode, literally, but it was entertaining. Which, which helped you, you know, like, how long were you drinking for, and how did you get out of that?

52:13 Um, I was drunk pretty much every day, or every few days. There’s like a good few months, but, you know, I, I got out of it because I wanted to prove myself. Like, I I got tired of feeling sorry for myself, and I was like, how do I get back on this? And the loss wasn’t because of one of the, the rules that I, you know, have made a lot of money. I had inadvertently broken my rules, which I didn’t know.

52:37 I didn’t know, like, the importance of liquidity versus a liquidity, right? And so then I was like, oh my god, this is such a great lesson. So it was basically like market tuition, and if you can lose half a million, I mean, it’s an expensive lesson, but if you get taught that, and I did get taught that, and then the press, while it was bad, it reinforced that lesson. So I never forget that $500,000. Right?

52:58 Yeah, I’ve had some losses, be like, after that never 500, that never even close to that, because I always remember how bad that was. So I encourage people, like, if you have that loss, like, yeah, it sucks, but it’s part of your education. You’re an incomplete trader, you’re an incomplete human, not just about money, but like, if you get knocked down in any field that you do, right? Like, anything that you’re really pumped about and somehow have you misjudged it or missed time something, and you get knocked down really hard, that, that is great for you.

53:26 Yeah, it’s like life. And again, back to a Conor McGregor analogy, when he got choked out by Nate, his cardio just killed him at the end, and he was just had nothing left. Yeah, the next fight he came back with a lot stronger and a better game plan and less aggressive, and it forces you to see what you really have. Like, it’s the challenge. Like, you might have a big loss or a big defeat, and then just give up, and you know, then you’re just, then it’s just a slippery slope, because you’re, you’re just feeling bad, and, and you know, you feel crappy about the whole thing, but for me, I took it as a challenge.

53:54 In it, like, re-energized me. You know, I felt like this thing, like my blood was boiling when people, first of all, people were saying, like, I lost money short selling penny stocks. They said you can’t short sell penny stocks, brokers that don’t have shares to short, they just say no, short selling penny stocks is illegal, and I’m like, no, it’s not illegal. You can do it. Your broker is lying to you.

54:14 So it made my blood boil, so I had a mission. It wasn’t just about the money. I wanted to get good information out there, and I wanted to differentiate, how did I make so much money trading liquid stocks versus losing a lot of money on an illiquid position? So when you asked about liquidity, it was kind of funny, because that was, like, my biggest lesson that I could share with the world. Now, none of my students ever get involved in an illiquid position, because they know my story because I talk about it non-stop.

54:39 Right, why teach? And you say you’re trading your own book and teaching it. To say oh yeah, why teach? You know, it’s an interesting thing to do. It’s, it’s not the most, it’s not the greediest thing.

54:49 No, it’s not self-interest. It’s the hardest thing you do. Um, for me, you know, the stock market changed my life, right? Like, I’m from a small town in Connecticut. It’s changed my family’s life.

54:59 I’m so grateful for it. And then, like, I said your family’s, because you could, they can, you can, you can pay for big mansion. I bought them a place down in Miami Beach, move them down from Connecticut. They’re loving the life. Like, my dad rides his bike on Miami Beach.

55:10 You can see the big, fat Jewish guy with, like, a fluorescent yellow Under Armour get up, and he thinks he looks cool, but he just looks like terrible. Um, but he loves it. you know, Miami Beach is beautiful, and you’ve had money to buy whatever cars you want, houses in LA and Miami, right, and live this life. So I’ve lived this life, and I’ve traveled to 120 countries, so I’m grateful for it. And for me, when there’s misinformation, that’s what really pisses me off.

55:33 When people said, like, you couldn’t short sell penny stocks, I wanted to not just say yes, you can. I wanted to show it, so I show every single trade. When you people say, oh, you can’t trade penny stocks, like they’re all scams, and I, so, I know some companies are good, so I show it. For me, it’s one giant misinformation kind of world. It’s like the, the gutter of the stock market, so there’s not much good information.

55:56 If you look at, like, Professor Kinsey, if you know history with sex ed, right? Like, he revolutionized the business, because everyone’s like, oh, you can’t talk about sex education, it’s too taboo back in, you know, the 40s and 50s and 60s. But he opened it up, and that’s what I’m trying to do with penny stocks. Most people just buy these pumping downs. They believe in the company, and then they come, and, um, crashes, and they get bitter.

56:17 That is the story of penny stocks. It is The Wolf of Wall Street personified across the entire world. For me, I want to teach short selling. I want to teach about liquidity. I want to teach about the inefficiencies with news.

56:28 So it wasn’t even a choice. Even if I wasn’t gonna make a lot of money, I’ve made a lot of money now teaching, but my best-selling guide. They’ll get a kick out of this. So people still hate me because I’m kind of loud about this stuff, and people just hate penny stuff. You are loud.

56:41 You like putting the car’s idea in your life? I do, but check this out. But it’s also penny stock, so people just normally hate penny stocks because they just think, like, automatically I’m some kind of scam, right? So I was like, all right, let me create a YouTube channel, right? So I have a thousand free videos on YouTube.

56:55 You can see my live trades, like that one where I’m surfing this shorting, and I’m like, this is amazing, and I only made a few thousand dollars, but just the fact that I’m showing that you can short sell penny stocks using, you trade just a normal broker. Um, the interesting thing though is when there’s free YouTube videos, they don’t watch it. They don’t value it. This isn’t funny, right? Funny, people, not you.

57:13 What they pay for it. I’m like, okay, so then I’m, so I send links to people. I’m like, okay, pay this, and they’re like, no, you just want to make money off me. I’m like, I just want you to learn. So I came up with a compromise.

57:21 How to make millions, calm. You can go there. It’s a guide, all for charity, so you pay for it, but I don’t get any of the money. So people who absolutely hate me and they don’t want to enrich me, they get this guide, they donate to the charity, and they learn. It’s 35 hours long.

57:35 I spent like seven months making it. It’s raised three million dollars for charity. Really, so that works. That’s what’s the rules. You’re not getting the money.

57:42 They’re not getting a dime, and they love it, and they’re like, I hate you, but thank you for teaching me. My top millionaire students hate me, because again, I’m not here to be like, like, sometimes I come down hard on people. Like, I say this is a battlefield. I’d like to drill sergeant. You never liked your drill sergeant, right?

57:57 Like, he’s always yelling at you. If you’re in my chatroom, you’re like, whoa, Sykes is savage. Like, I come down on people when they break rules, because I want them to be better. I want them to remember it. Your million-dollar trader students hate you.

58:09 Yes, 100%. I hope you get nasty with him, and you open. I have a few, like, actually, one of my millionaire students, he doesn’t even want me imagining and publicly anymore, cuz like when you’re shorting these penny stocks, sometimes there’s not a lot of shares to short, and so, like, he took the shares, pretty much all the shares to short, and I was pissed, but I was like, you know, happy for him that he got the shares, because it’s not crash, and he made, like, 50 grand, but I told the entire chatroom to swear at him and say fu, right, until the whole chatroom is telling him fu as he made like 50 grand.

58:37 He took it very personally, and for me, I’m just like joking around, but kind of not, because he took all the shares to short, so I have fun with it. Like, my first millionaire student, Michael Good, he wrote a blog post that said Timothy Sykes is full of BS. It’s still up. you can google this, and we went back and forth in the comments. There’s 60 plus comments, and he gave me a chance, and now he’s made two million dollars.

58:54 So he said you were full BS, then he took your courses, threat, and then BOOM. Yeah. Holding them accountable is the hardest thing for your students. 100%. Is they want to get rich quick.

59:02 They don’t want to put in the time. Have a discipline, take the hits. Correct? I’m teaching degenerate gamblers rules to be disciplined, which is like the toughest thing. Like, I’m basically like taking, like, homeless people off the streets and I’m putting them in suits and like putting them into an environment that they’re not used to.

59:17 I said this to Larry King. I was like, if you go to a homeless guy and you have two bottles in your hand, one is like a Jack Daniels bottle, and one is like green shoes, which is the homeless guy probably gonna take? Jack. Correct. So I give him the Jack, but I fill the Jack Daniels with green juice.

59:32 So I tricked the homeless guy. That’s basically what I’m doing. I’m giving these people, like, I show off my cars and stuff like that. I show off my travels. Tell me that strategy, show up the cars and the travel and the bling and the house.

59:42 Correct? Because you need to get people’s attention. You need to get them studying. The one thing that I’ve learned that works is getting people to study my videos, right? I have 6,000 plus video lessons now.

59:51 I’m kind of crazy. I have, like, all these categories. It’s like the Netflix of penny stock learning, and now my top students make me video lessons too, so it’s a nice little community, sharing good trades, bad trades, lessons, everything, but you have to watch it. It’s 400 plus hours worth of content. So how do you actually get them to watch?

1:00:07 So I did a test one time. I did this one 45-minute video, like a deep dive into this one penny stock. I was like, why is this penny stock a scam? And I reviewed their financials. I reviewed all their legal filings, which are like 50 pages, and it was clear that this company was a scam, but people don’t want to learn that.

1:00:23 Like, they’re just like, okay, the company’s a scam, I don’t need to learn how. And I was like, how do I get people to, like, look through this stuff? It can be boring. So I put a little 30-second video of me in my Lamborghini, my first Lamborghini, and I changed the thumbnail on the video to me, my Lamborghini, and I said, watch this video, you’ll learn how to get Lamborghini. Right?

1:00:41 So it’s the same 45-minute video, but it has a little 30-second intro of the car. It’s like the carrot. So I dangled the carrot literally in orange Lamborghini. It’s like, orange carrot, right? And I dingle it in that video with the little 30-second Lambo trailer got four times the amount of views, and everyone, the comments are crazy, and it’s the exact same freakin’ video, just with the little 30-second.

1:01:02 So that’s basically my entire business. I say, look, you can get this car, which is accurate, cuz I’ve got in this car through training, but it takes time, and you have to watch videos like this. So it gets them in the right mindset to actually put in the time. Most of my millionaire students are from the Midwest. This is another fly.

1:01:17 Why do you think they’re from the Midwest? Yes, nothing going on but the rent. There’s nothing to do in the Midwest, so they study. If you actually look, and I’ve done this with my programmers, I’d look to see, like, the time they spend on my site. Midwestern Americans have nothing else to do.

1:01:34 They have no entertainment. They have nothing else, so they’re probably just watching my video lessons in Netflix. It’s fantastic, because they’re putting it. I’m doing a Midwestern meet up in a few months, and I’m gonna have all my top Midwestern students. I have a very popular guest.

1:01:46 His name is Dan Peña, the 50 billion dollar man, and that’s a high performance coach who has a castle in Scotland, and I think you are the Dan Peña of penny stocks. Cool. You know, because he is all about trying to get people to get the best out of themselves. Yeah, he dangles off his castles and things like that, but it’s all about putting in the hard work, and he pushes them. Correct?

1:02:02 And I’m not that special. Like, I’m not that good at math. I’m not that smart. I just recognize inefficiencies, and now I have 20 years of experience, so I have a few key attributes that can help people. Like, it’s in my own best interest to train my students to be the best.

1:02:15 Like, I want more millionaire students. I have five. Like, people are like, oh, you only have five because most of my students don’t put in the time. They just want hot picks. At first, unless I can train them to say, okay, let me look at the process, let me learn about these inefficiencies, let me learn about these different patterns.

1:02:30 Why not move back to Connecticut and join one of these big hedge funds? You’ve seen the the TV show Billions. Then of course you could be one of those. I visited SAC Capital. I visited, or when I was SAC Capital, you know, I visited Steve Cohen.

1:02:44 He had like 30 monitors. It was fascinating for me. I’m so fascinated by the potential for education on the Internet, and I’m so fascinated not just in penny stocks. Like, I started my charity, or with this Save the Reef documentary, we can actually save the coral reefs with, like, some very basic stuff. Like, if you use the right suntan lotion, people don’t even know this stuff because it’s not widespread.

1:03:03 Do you know about the sunscreen? I didn’t. Right? So sunscreen with oxybenzone oat is one of the bad chemicals. If you put it on your body and you go in the water, it rubs off in the water and kills the corals.

1:03:14 That’s one of the main key things that we can do. Even if you don’t go in the water, let’s say, oh, I use sunscreen but I don’t go in the water, and I wash it off in the bathroom, it still eventually finds its way to the oceans. Golf courses are killing coral reefs because they use all this chemicals to kill the bugs, and that all drains into the ocean. So very base of things. Those are some simple things.

1:03:32 Okay, for me, I’m fascinated by social media and new technology to see what we can do educationally for penny stocks, like this in efficiency, and now charity, which is another big inefficient. Why not go to Connecticut and make billion? What are you obsessed with Connecticut? I don’t know. It’s not billions of dollars, but come on, hedge funds and billions a lot of people, if I was gonna tell your story, we just assumed that you would graduate to this level, and you would become, you know, the Cohen SAC character, or whatever the guy in the TV show.

1:03:58 For me, I, you know, again, I’ve traveled everywhere. First of all, I can’t stay in one place. Like, I love your office here, but I, I cannot stay in any one place. Like I said, I’ve been in 12 countries now just the past few weeks. I do about 40 countries a year.

1:04:10 I’m fascinated by the world, so I don’t need any big mansion. I’ve had big mansions. I’ve had villas. I’ve had penthouses. I’ve had nice cars.

1:04:18 I don’t need any of that stuff. For me, social media and interaction and using this technology and utilizing it to see what we can do, that is the challenge for me. That’s what’s fun. It’s not even about the money. Like, again, like, I would like all of my money to come from, you know, the charity guide.

1:04:34 Like, I want everyone to get the charity guide, and I’ll just donate it all. I give a TED talk, why I’m never gonna be a billionaire, because I’m always gonna donate so much to charity. I don’t need it as long as I have good food, and I can travel, and I have a nice bed. That’s fine. You know, how do you feel about billionaires?

1:04:49 Um, so this is funny. I was on Impact Theory. You know, Impact Theory, right? I didn’t know, like, usually I do research with everybody, but I was like, crazy busy traveling. I didn’t know how wealthy he was and how successful he was, because he’s a billionaire-ish.

1:05:03 So I go there, and, like, all these Quest nutrition bars, and I’m like, what is this show sponsored by Quest? Like, I literally have no idea, and I’m just saying this stuff. I’m like, I’ll never be a billionaire. I think billionaires are spoiled. I think they should donate a lot more, and he’s like, oh, really?

1:05:17 And I’m just like, I’m making a fool of myself. It’s kind of funny, but you meant that. I do mean it, and I still mean it. Like, I don’t think that you need as much money as most people think. Like, I literally have just a few million dollars in the bank, which is fine.

1:05:29 Like, I can take care of my family. I have a lot of nice stuff for myself, my friends, that’s fine. I donated a lot. Like, I’ve donated millions, and not just from the guy, but of my own money, like, a disproportionate amount of money. For me, I think that, you know, I grew up never thinking about charity and everything about teaching or anything, but you evolved, and for me my evolution is very different.

1:05:53 Like, I’m I’m messed up in the head, where I want to give money away. I want to, you know, spend most of my life, like, perfecting my teaching techniques and now my charity techniques on social media. You said you’re messed up in the head. What do you mean by that? My priorities are very different than most people’s, these days, especially in their thirties.

1:06:12 Correct? I would expect guys in their fifties. Yeah, for my, I’m ten years old. Okay, I can see. I could see you know the value of this stuff, and I’m teaching, and I love this.

1:06:20 Is, I’m, I’m changing the world with the show, and I get it. But the 38 year old Brian was in the City of London here, stack in the paper for himself. I’m, I’m obsessed to see this new technology and what it’s capable of. We’re at a very unique time in history, as you know. You know, you’re utilizing this new technology to get information out quicker than ever.

1:06:38 So maybe if this were 20 years ago, or 30 years ago, we didn’t have this opportunity. Maybe I’d be different, but I’ve had the nice stuff. Like, I just don’t need it. I donated a million dollars, literally, a few years ago to Pencils of Promise on this spot in Laos, and I was only supposed to donate a quarter of a million dollars. Like, I’m not that rich, right, but I donate a million dollars, because I was like, screw it, I want to build more schools with Pencils of Promise, so now Gary, when you did that, I know it was the best moment of my life.

1:07:04 It was one of the best moments. It was fantastic. First of all, they were there. There was a translator, because we’re in Laos. She didn’t understand what like a million dollars was.

1:07:11 She thought it was like a thousand dollars, and they were still excited. Um, but we built 52 schools now with my charity. I’ll tell you this other thing. This actually probably answers your question. So my friend Neil built the school in Cambodia, Neil Patel, and I was like, Neil Patel built a school in Cambodia?

1:07:26 I’m gonna build a school, because we’re competitive with each other. Okay, so I built my school next to his. It’s like three times the size of his. So I sent him a video, and I was like, here’s my school, and I had all the kids here, like, trading in there. No, no, no, no, trade it.

1:07:37 Okay, but this is, like, a real school. But I had all the kids line up, and I showed the video, and they’re all cheering, and then I’m like, here’s my school, Neil, and here’s your school, and there was nobody there. There was, like, a janitor. So I just, like, wanted to do that, but then I was like, I actually liked building schools, so let me keep building them. But for me, they didn’t do well on social media.

1:07:54 Like, my charity posts always do the least. My Lamborghini photos, I used to post, like, stacks of, like, a million dollars in cash. Those do the best. So I was like, how do I get charity to do well? So I did a tweet on my first school in Bali, and I said, for every retweet, I’m gonna build another school, and normally my, my charity stuff gets, like, five retweets.

1:08:13 So I was like, you know, maybe I’ll get, like, ten or twenty instead. It became our most popular tweet, and it’s, like, 8,000 retweets now. Be real, like, dude, you got to delete that. You’re on the hook. And I was like, screw it, so I pinned it, so it keeps getting more retweets.

1:08:25 So now I’m on the hook technically for 8,000 schools. Why not? You know, let’s see what happens when you throw out your previous goals and you create new ones that excite you. I think that you should always have goals and challenges for yourself that excite you. You know, for me, buying my first Lamborghini, that was so exciting.

1:08:44 When it got delivered, I was like, this is amazing. When I bought my second Lamborghini, I was like, this is cool, but the adrenaline rush wasn’t there. The dopamine hit wasn’t there. Now, when I donate money, and you know, not even just about the money, you’re building the schools, but when you visit some of these, you know, little communities in the middle of nowhere, like in Laos, part of the reason why I donated the money, I met this girl. She hugged my leg, right?

1:09:07 She’s very malnourished. She’s like a little girl, and I looked down at her, and she smiled at me, like, big bright eyes. She had no money. Her family has no money, but she was so happy, and through a translator, she was happy just to be alive. She was happy to meet me.

1:09:19 She’s never met, like, a white person before. She’s happy that her family’s alive, and they’re all healthy, and I looked down at the bottom of her feet. She had no shoes on. She had plastic water bottles taped to the bottom of her feet, and I was like, what’s going on here? And through a translator, I found out that those were her shoes, because she was good at school, so her mom rewarded her by taping the plastic water bottles to the bottom of her feet, because the ground is hot and rocky and Laos.

1:09:44 So that was luxury to her. And I’m just thinking, mind-blown, like, perspective shift when you go to some of these third-world countries. So for me, it’s not about the cars or the fancy stuff, or, you know, I meet celebrities all the time. Like, that doesn’t do it for me. Now I want to see what can we do to bridge, you know, the third world with the first world using this new technology and information.

1:10:04 What are the charities you’re doing? You’re opening up school, how many schools you got? So we’re 52 schools open. Okay. Pencils of Promise, Cambodian village, fun build on charity.

1:10:15 Yes, okay, and sharing it and sharing it and seeing how it gets other. So we have 52 schools with my charity that Timothy Sykes Foundation. I actually changed the name to Karma Gawa. Why did you change it? So it’s not about 9000, correct?

1:10:27 I had enough schools named after me. I started naming schools after my top students, then about friends, and I’m like, I just don’t need it. I know people, like, usually get their names, like, on buildings. I’m just weirded out by it now. Now, I’m just like, like, it was nice in the beginning, but it gets old.

1:10:41 So Karma Gawa. I have this whole charity community now on Instagram, and we share everything, and they’re really interested in the ideas, and we built 52 schools. The followers have built 14 schools because we post about it, and they start donating to charities too. So it’s spreading, and it’s pretty cool. You can build a school for like 30, 40, 50 thousand dollars, depending on the community.

1:11:01 And now you’re making movies as well. Maybe, dr. mentoring spot rhinos about the clothes on our Rhino video by Sam Colder. I bring like influencers and creators on these trips to, like, document it with photos and videos. I’m not that good at, you know, photography or anything like that, so I bring them. Sam Colder did this video.

1:11:18 Spend months on this. We visited South Africa twice. We did this Rhino video. It has 30-plus million views, raised a ton of money. I donated $250,000 to the Rhino charity Vetpod, which helps save the rhinos, but other people donated over 500,000 to a bunch of different Rhino charities, so it’s cool to see what we can do by sharing this stuff publicly.

1:11:40 Let me ask you a question. I had Tai Lopez on here years ago, and he said, Brian, you got to cut checks to charity. And he said, look, I’m not exactly the most generous guy, and it’s probably true. Ty isn’t, but he said it always comes back to me, like 5x, 10x. Have you found that?

1:11:53 So Karma Gawa, our logo is an infinity sign, because it’s amazing when we give to a community. They open up to us. Other people open up. Like, I don’t pay any of the filmers, or the influencers used to come with us, and these people get like 20, 50, $100,000 for Instagram posts, and they’re posting about this charity for free, because in a kind of a meaningless world, they’re feeling useful. And they see this stuff.

1:12:16 Like, we were down in South Africa a few days ago at a Drakenstein Lion Park, and they save these lions that are basically just slaughtered for their meat or their bones. Like a lot of Asian medicine. People think that lion bones are gonna cure you. There’s no medicinal properties whatsoever. So they save these lions, and they’re basically just a retirement home for these lions, and it’s so sad.

1:12:34 And we brought these influencers, and they’re crying, right? These people with millions of followers, because they had no idea, cuz they thought that they were coming to Africa to take pictures with, like, lion cubs. Like, you know, you take photos with that. You don’t realize that the lion cubs that you’re taking photos with, they’re there. Yes, they’re useful when they’re cubs for photos, but when they grow up, they’re ferocious beasts.

1:12:53 So they get slaughtered. They get hunted. They get killed. So if you actually pet or take photos with a lion cub, you’re complicit in this whole thing that people don’t know about. So we’re gonna do a documentary on that, with a rhino horn.

1:13:05 Rhinos are gonna become extinct. There’s only a few thousand left. This wasn’t even a problem a decade ago, but they’re getting killed for their horns, because people think, especially in Asian medicine, that these rhino horns are going to help them, like, help cure cancer. They’re gonna be an aphrodisiac. They’re nothing.

1:13:20 There’s literally just the keratin in your fingernails. That’s what rhino horn is made up of. So it’s a myth, and we’re gonna destroy an entire creature. So again, with penny stocks, I see misinformation with rhino horns and charity. I see misinformation, so I want to correct that.

1:13:35 That’s what I think the potential of the Internet is. And you know, we’re filming here. Like, we can get the message out to millions, if not billions, of people faster than ever before possible. If you look at, like, what is the most popular photo on Instagram? It’s a freaking egg.

1:13:48 Did you see that? I did. It was actually a good cause. Eventually, it was for mental health. Like, the egg was cracking, but it just shows you, like, that things spread like wildfire.

1:13:56 So what if we spread something that we matters like wildfire? Like, together, we can change the world. Like, people don’t think, like, oh, why are you trying to save the coral reefs? I don’t even like putting my head underwater, right? I can barely swim, but coral reefs, did you know that they’re responsible for the majority of the oxygen that we breathe?

1:14:13 Marine life. People think that it’s all trees. Trees are actually the minority. The majority comes from marine, lion, all that stuff, and that’s all dying. So in 50, 60, 70 years, maybe even by 2050, in the next 30 years, we’re gonna have a tougher time breathing unless we start changing our ways, right?

1:14:29 Now, misinformation, so you’re like the Robin Hood of information as well. Yes, yes, already awaiting stocks, but now the information. I would go with that, because Robin Hood, you know, makes me look more generous than I am. For me, this is correcting misinformation, and I can, I can get that out there quicker than ever. Okay, you mentioned you’re hanging out with some Game of Thrones celebs this weekend.

1:14:49 Why do celebrities want to hang out with you? Why? Oh, I don’t know. Um, I, I hang out with a bunch of different celebrities and influencers, again, because I’m telling them about these causes that they might not be aware of, and they can use, like, their, their fame for good. They can use their influence.

1:15:06 Like, a lot of people, you know, try to, like, take pictures with celebrities, like, and they’re like, oh yeah, like, they’re my, but, like, I don’t know them that well. They just want to get involved in charity, and I’m proud to, you know, kind of be the middleman between them and charity. A lot of charities do good, but they’re terrible, terrible in marketing. They’re terrible with, like, people skills. So for us, like Karma Gawa, like we try to be the middleman.

1:15:28 Like, we’re like, okay, here’s a great cause. The charities do great work that we work with, but they just don’t know how to market themselves. So that’s what we try to do. They don’t have the content. They don’t realize, like, okay, if you build a school, you should take photos of it, but they’re like, no, we shouldn’t, like, exploit the kids.

1:15:43 And I’m like, you’re not exploiting it. You’re showing the great work that you’re doing, you know? But, like, it’s, it’s a very, like, charity and money. It’s, like, very taboo subjects. How do you post it without looking bad?

1:15:54 And for me, I’m just like, this is great work. Let’s show it. Let’s get it out there. Do you have charities you look up to as, like, the example of what you want to be, or things that are doing good things? Um, I mean, Pencils of Promise is my favorite charity.

1:16:05 I’ve donated two point two million dollars to them. They built 500 schools, so we built 26 schools with them so far. They are so organized, not just with building schools, but like choosing communities. Like, the communities have to put up money. There’s a whole process.

1:16:16 It’s not enough just to build a school. Like, you just build the school, it might close down, right? But if the community has a plan, they get involved with it. They take ownership of it. It can last.

1:16:26 You don’t want it to be like, you know, like the Russian Olympic stadium, that was billions of dollars invested, and now it’s just growing grass, because there was no real plan after the Olympics. Other charities you look at: Bill Melinda Gates Foundation, Charity Water, Fight for the Forgotten, Listen. Dirty things. There’s so many great causes, but again, for me it’s, can we use social media to really go viral, and, you know, the Rhino video that we did, this was our first documentary, and I’m getting messages from people saying, like, this is the most successful animal conservation video of all time, and I’m like, we don’t even know what we’re doing.

1:16:56 Like, this was our first attempt. I would look up to Invisible Children. If you ask about that, do you remember Invisible Children from 2012? They made this video, got over a hundred million views on YouTube, which other time was massive, and they were all about trying to take down this dictator in Africa, Joseph Kony, or this one, yeah, the Kony campaign. Yeah, it totally went wrong.

1:17:15 It totally bombed. The CEO, yeah, the CEO got naked and, iego know, he’s pounding the pavement for no reason. It couldn’t a do, but the video was fantastic, and there’s never really been a follow up. Like, literally, with our Rhino video, they’re saying, like, oh, this is like Kony, like six years later, but it wasn’t like we didn’t have everything down, but Kony is still free. Like, that’s the sad thing.

1:17:39 That video was fantastic, but the charity kind of folded, but it meaning good. I mean, he’s an old man now. He doesn’t have the power he once did, but I think that was a nice spark to see what’s possible, and that was just a random cause that was explained properly, and it united the youth. So that’s what we’re trying to do. Like, you know, with the reef.

1:17:57 I mean, this is a problem, or more, all marine life. I think this is a problem that we’re all should take more seriously, but we don’t know about it. So this is why, you know, I’ve spent like a quarter of a million dollars just traveling around the world with a film crew, just filming all this stuff. There’s no putting it together. I want to watch it.

1:18:13 There’s a lot of people watching, you know, from grandma’s to kids to housewives to unemployed people that are probably thinking, okay, I wanted to start training. No, and, and you say no, stop, stop, stop thinking that. Okay, you should start studying. You should start thinking about inefficiencies. Like, everybody wants to make money right away.

1:18:32 What they have to understand is that you need, like, you have two accounts. People don’t realize this. You have a knowledge account and a monetary account. Everybody wants to grow their monetary account without knowledge. Like, oh, I’m just getting to trading, this sounds fun.

1:18:44 I could say going to Vegas for the weekend, unsexy. For me, I want to grow the knowledge account. Like, you can’t. Some people say, oh, I don’t believe you, Tim. Let me make a thousand dollars, then I’ll believe you, then I’ll study.

1:18:53 And I’m like, it doesn’t work like that. Like, I don’t care if you believe me or not. You need to grow your knowledge account. So for me, I want to teach people. Watch my YouTube videos.

1:19:01 Learn about why are there inefficiencies with penny stocks, why do I spend my life on this niche that the entire world hates? Like, do I just, like, hate mail? Like, why do I do this, right? But for me, the inefficiencies exist, whether it’s charity or penny stocks, and that can change the world. So even if you get, want to get into trading, don’t necessarily jump into it.

1:19:21 Get into understanding, you know, basic auctions, like supply and demand. That’s what I’m doing, and penny stocks for me is the way that I do it. You know, I was at our Christmas party, not last Christmas, of the Christmas before, and I’m a former trader, but I don’t I don’t play around with stocks anymore. I’m too busy. And so, but my, like, a third of my team, we’re trading Bitcoin, and I was like, what are you talking about?

1:19:42 Do you have any background and stuff? Have you ever done it? No, but a stop loss order. And I was like, this is crazy, and you know, sure enough, four months later, like most people said, it is about. I think I mean, so many people said Bitcoin was going to a million.

1:19:54 Maybe it will eventually. Like, it’s a good idea, but you can’t predict exactly. Like, I underestimated it. Like at 12,000, I was like, it’s it’s done, right? But I would rather be safe than sorry.

1:20:04 This is what I do with penny stocks. I usually underestimate everything, and I wrote it up, not necessarily with Bitcoin itself. Oh, with Bitcoin stocks. Like I said, when companies would get into the Bitcoin space, they would spike for two, three, four days. I don’t like Bitcoin because it trades 24/7.

1:20:19 All right, so I don’t like that. I don’t, I need some time off. Like, I want a stock market crash. I would love to take a year or two off and just get organized, because there’s plays all the time, and I have video lessons everywhere, and it’s not really as organized as it should be, but it’s because there’s no freaking time off. Like, we’ve been in a ten-year bull market ever since I got started teaching.

1:20:37 Wow. And so crypto, you don’t like, cuz it trades all the time. What else don’t you like about crypto? It’s a guess. You said it’s, you know, I like the volatility.

1:20:44 Okay, I like, you know, even now it’s doubled off its low. So just have 3,500 now. It’s at 6,500, so it is moving. It’s volatile. I don’t like how many people are obsessed with the story only, and they’re ignoring charts.

1:20:56 They’re ignoring patterns. They just believe that idealistic BS, which is like penny stocks, right? Maybe it will work out, but the odds are against it, and the chart is very similar to tulip mania a few centuries ago, when the prices of tulips, you know, spiked. It’s very similar to the pump-and-dump charts of the 1990s and 2000s with Internet companies, and then weed sauce galore. Like, I look for these pump-and-dump charts.

1:21:18 We’ve seen so many of the same mania, like Y2K. Remember Y2K? And I do. There are so many stocks that went from, like, 3 to, like, 80 in a few days. Accelerate Technologies.

1:21:29 I remember this, right? Like these stocks spiked, everyone gets all excited, and then it comes down. Remember, a bola. Remember everyone freaking out about Ebola? All the Ebola stocks spiked, and then it turns out Aaron Hernandez killed more people than Ebola killed, like in the U.S.

1:21:43 I mean, it’s still a bad disease, but the fears were overblown. So this happens again and again and again. Why does it happen? Because we’re human. Psychology.

1:21:51 Yeah, psychology, the groupthink, fear that people are in the greed, and all that. So, to have happened in the 1600 or 1500 years, it was in Amsterdam, and these tulips, flowers, started getting bid up in price, bid up in price to where they were, looks for going for thousands. If you get one tulip, and it was like the equivalent of, like, a giant mansion. Like, it was ridiculous. Right.

1:22:15 There was a recent bad movie called Tulip Fever that tracked it. Okay, very similar. There’s a great book from a few centuries ago, Extraordinary Popular Delusions and the Madness of Crowds, one of my favorite books. Weird title, very tough read, but the South Sea Bubble. That happened.

1:22:30 So these bubbles pop up. If you look at, like, viral hits, like the number one song right now, Old Town Road. It was just created by, you know, Old Town Road. You know, I don’t you don’t know. Old Town, burn up, plugged it up, busy here.

1:22:40 Old Town Road, in little effects. You have to know about this is, can’t acid. The New York Times just did a whole little video on this, and so what did you learn from the song being a hit? Is that what it’s, it’s viral, or it’s agree with her? It’s viral groupthink, but it was done very meticulously.

1:22:55 Like, it wasn’t, it’s not an accident. The book Hit Makers is another book that you should read. Like, you can kind of construct how something gets very popular, and you tap into people’s psychology. This is like what Jordan Belfort does. All right, he knows how to sell penny stocks.

1:23:09 Now he knows how to sell a pen, or sell his courses. Right? If you know how to market that, like, there’s business lessons in that too, as human emotional triggers. The jam pop on people, and how these things happen, but you as a trader, you also have to recognize when we go against the crowd, and oftentimes I go against the crowd. Like, so for me, in, as a Internet guru, everyone has, like, their cars, and they’re showing cash, right?

1:23:31 And I did that to motivate my students, but now I’ve gotten away from that, because it just, it doesn’t, I don’t get, like, it gets old, and I don’t like it, and there’s so many other people doing it, and I want to differentiate myself, and I want to be real with what I am, which is the charity. So even though the charity started out as, like, my least viewed, least, like, photos, I found ways to angle it so that people are interested, and now people are obsessed with it, and I think that’s fantastic. That’s for the betterment of mankind.

1:23:58 Okay, so you’re telling people, don’t trade, study. Correct? Don’t open the brokerage account and start doing that stuff first. You can open her. Yeah, exactly.

1:24:07 Trey’s about 100 shares, like money that you can afford to lose as you practice. Right? We have a software called StocksToTrade. You can use paper money, and it’s just like fantasy cash, so you can use that, like, to start learning the different volatility, you know, patterns, up and down, and start getting used to that, because this is a lifelong skill. A lot of my best students, they make a lot of money over the long term, but they don’t make money up front.

1:24:28 Like Tim Gur, Tommy, who might be a clone or a robot from the future, he’s made eight million dollars. He made nothing his first nine months. So if he was studying and practicing every single day, living at home with his mom, so think about that. Are most people prepared to make nothing and study every single day? And he’s the best trader that I know.

1:24:45 So are you prepared to study for two years and make nothing as people rip on you like penny stocks or a scam? Tim sucks, as a scam, and you’re hearing this, and you’re just watching, and you’re not making any money. Like, people want to study based on the potential financial reward, but forget about what if you’re making enough? What if you’re, like, 90% of traders and you lose? Are you still gonna stick with it?

1:25:04 So for me, it comes down to people saying they want to trade, but do you want to trade for the right reasons? Are you gonna be disciplined in your studies first, when there’s no reward? The reward comes later on, you know? Like, are you willing to sacrifice a year or two to learn a skill that can benefit you over 10, 20, 30 years, but there’s no financial reward right now? That’s a tough sell.

1:25:24 Do you think learning how to trade benefits you in other ways in your life? 1000%. You know, you start to kind of see the world for what it is, and you know, it might be a little more of a cynical approach, but that’s good. Like, no one is gonna scam me after my five hundred thousand dollars. Forget about just trading.

1:25:41 Like, I expect the worst out of everybody. In that way, I’m not disappointed. Like, you are guilty until proven innocent. That’s the way it is in finance and in business, and I think more people could benefit from that. Yeah, I, I remember I moved to New York City and I was trading for a couple years, and I remember I tried to reconnect with, like, an ex-girlfriend, and she was in Boston, and I flew to Boston to try to see her, and I couldn’t see her, and I was, and I was there for a day, and I was like, I’m gonna stay a few more days, and I was like, no, this is a stop loss, and we’re cutting our loss.

1:26:08 So this is another thing, relationships. Yeah, we’re emotional people. We’re loyal, many of us, right? Like, we want, we want things to work out, and sometimes you just have to cut it. Like, you have to cut toxic people out of your life.

1:26:19 Life is too short, but a lot of people, they’re like, no, I didn’t mean it. Like, it was drunk, or like, oh no, he’s gonna change, or she’s gonna change. And sometimes you just have to be like, no. Like, they’re not in a position. I cut the losses.

1:26:32 You need that long. Another one, a better one tomorrow. The thing, but a lot of people aren’t willing to do that. And trading also helps with investments. I know so many people who message me, they’re like, Tim, I ignored your rules.

1:26:42 Like, I’m down 80% in this stock. What do I do now? And if you’re down a lot, again, like it’s always a new decision. Like, you can cut your losses at any time. You’re in control, but people lose that control because they get emotional.

1:26:54 They feel loyal. They feel married to a position or a person, and they accept it. And the beautiful thing about being a trader is that you can change, right? Like, you can get out of a position, and then maybe the position is, is gonna be better. Like, let’s say you’re in a bad relationship.

1:27:09 We’re like, your husband is beating you, right? And you’re like, no, you can change. You can change. We’ll get out of, lationship proof. Let him prove that he’s gonna change.

1:27:18 Maybe he has to go to therapy, maybe he needs, like, six months, like with a counselor or something, and then prove it, but you have to cut it, otherwise they’re just not gonna change overnight. Yeah, most of the time, do you usually tell people, and weird trading positions, to just cut all the positions. 100% take a break. 100%. Okay, you know, like, it’s, it’s also when you have a big loss.

1:27:37 I mean, I turn to drinking, and I was on a reality show, so it was a weird way to deal with it. Um, but when you have a bad position or a bad loss, like you’re, you’re emotionally messed up, like you said. Like, you know, if you’re getting in a fight with your wife, like, you don’t come to training the next day. I don’t want to take revenge trades, because then sometimes you put your money into a new trade, and you’re like, I just want to feel good. I want that dopamine hit, so I’m in this trade, and maybe you bet bigger than normal, because you want more of a rush, and then you lose, because you’re not thinking logically.

1:28:05 So for me, I want every single trade to be meticulous. I don’t want to just enter in a trade. And this is like with my newsletters. Some days I don’t create, and people are like, hey, I’m paying you, like you have to train. I’m like, no, sometimes the best trade is no trade, and I do a video lesson comparing like five potential trades and why I didn’t take it.

1:28:22 So you have to be willing to take losses. You have to be willing to make no money and sit on the sidelines. Like, for me, patience is often the best, best option. You know, sometimes there’s no hot penny stock, or the penny stock that’s hot, it’s too risky. Like, I can’t control my risks, because it’s, it’s choppy, it’s too crazy, so I don’t know what to do, so I do nothing.

1:28:42 Yeah, sometimes the sniper doesn’t take a shot. Exactly. And this is why I say this. You know, like, you have to watch those sniper movies. Go watch American Sniper, right?

1:28:50 He sits there for like seven hours. Yeah, you know, you know, pisses on himself and just doesn’t take a shot. I mean, this is what you have to do. Like, sometimes that’s required versus like, I compare it to, like, being, like, guerrilla warfare, like a sniper versus, like, the British redcoats, where they’re all in uniform, they’re all out in the open. You could just pick them off one by one.

1:29:08 Like, there’s different types of warfare, and when you have a small account, you have to be up in the trees picking people, or picking stocks off, not picking people, but picking stocks off one by one. Tell me about you. You have daily habits. I know you travel all the time, but you have something you do every single day to keep your brain right, to keep yourself grounded. Do you meditate, training, diet?

1:29:26 What is it? A positive way of thinking the the Himalayas, could you handle it for a month on your own? Is there service? No. Whoa, there’s no service.

1:30:02 Yeah, so it’s one of those monasteries where you can’t talk, you can’t, like, look at people. What if you had no to do? It, I would, I would just take, like, mental notes of a book that I want to write. I mean, I would be preparing for something else. I, maybe I would enjoy it for a little bit.

1:30:16 I would, like, go hiking and enjoy nature. I would try to make the best of it, like, so tapped into the info, whether it’s a stop price or social media or a charity project. Listen, machines are probably gonna kill us in a few decades, so we need to make life the best possible. You know, whether we kill our planet or the machines kill us, we’re probably gonna die in a few decades, so we need to maximize our lives, like, right now, before it all explodes.

1:30:38 How the machines gonna kill us? Possibly. Okay, we hardly Netflix. It’s probably something that we all use, and we’re tapped in, and Netflix is gonna come out with more and more stuff, and it’s be like, before it was DVDs delivered to your door, now it’s streaming, and then eventually it’ll be tapped into your brain, and then it’ll have everybody. Amazon, Netflix, Tesla, one of these companies, or not.

1:30:57 Elon Musk, he’s anti-AI, so he’s good. Yeah, and maybe Netflix. Netflix is killing us right now, cuz it’s trying everyone’s brain into muck. I mean, anything could happen. So we just have to maximize it, and we need to get educated.

1:31:09 Like, I think education is the potential cure for our planet, you know, to try to fend off the machines in the future. We have a lot of bad tendencies and a lot of dangerous things on the horizon, and a lot of uneducated people, no different than, like, penny stock promoters versus naive, financially naive people. Right? Like, most people are not prepared for penny stock promoters. If a penny stock promoter comes to you with an email or a phone call, you don’t know that much about the stock market.

1:31:36 You don’t know much about, you know, anything, so you just believe they’re marketing. That’s the same thing with education. Like, the world is changing faster, and we’re unprepared with education. But the cool thing is, we have this tool that we’ve somehow created or stumbled upon, where we can get mass education all at once. And that’s what, you know, it’s kind of like a race.

1:31:55 Are we gonna destroy ourselves, or we’re gonna get educated? Are you gonna live a good life, or are you gonna just live a crappy life? The choice is ours, and we just need to, like, get in the right mood, get in tune with what’s going on and take advantage of it. Most people aren’t doing it. Like, people might watch your shows for a little bit.

1:32:13 They’re like, wow, this is really cool, but then by, like, minute 15, they’re like, oh, new Game of Thrones is on, so I need to, like, live fantasy. Look at the top rated movies and TV shows, all fantasy. All right, Marvel, all the superheroes, is another world. Game of Thrones is another world. What’s wrong with our worlds?

1:32:29 What if we change our addiction to learning about what’s actually happening in our world? And I believe it can happen, because, frankly, like, education has propelled my life, my family’s life, my top students’ lives. It’s because I’m focused on what can we achieve in this lifetime, and life is only getting longer. Do you believe in the singularity? I know of it.

1:32:50 You know, I’ve had Jason Silva in here a few times, and I know, I know about it, so I mean, I guess it’s gonna happen at some point. 2045, 2047. I don’t think you can predict the exact thing, but I do think that modern medicine and technology is increasing faster than most of us realize, and we’re gonna have more time. I wouldn’t be surprised if the average age is a hundred or 150 in a few years. Like, cancer probably will be cured.

1:33:12 Yeah, just wonder if we can walk around at that point. Look, I think YouTube is a fascinating piece of technology. I’ve always said we don’t really understand what it is, but it is the most exciting educational platform we’ve ever seen. It can be used to learn exponentially, as you said, if we just decide to embrace it. Hang out, watch Game of Thrones, and I love David Rosen.

1:33:28 I do too. Yeah, but I mean, like, that’s why we love long-form content, cuz I feel like you can get a nuanced message. My, had Jordan Peterson in here, who said, Brian, you know, we’re realizing what long-form content that people aren’t as stupid as we thought they were, as in, people of all walks of life. Yeah, they want to understand complicated things, rats, and have nuanced discussions about philosophy, about life, about everything. We got to give ’em a chance and give ’em a platform.

1:33:49 When I first got started teaching penny stocks, a lot of the top finance people came to me, like, I still, I was on the TV show, so I had, like, some connections already, and I just got started teaching. Like, I got started teaching because of the emails. From the TV show, start getting 50,100 emails a day, like, teach me penny stocks. And all the finance leaders that I knew, they’re like, no, people can’t handle it. They’ll just want money, and I’m like, no, don’t, don’t underestimate them.

1:34:11 And for a while, I, I wasn’t very successful. Like, I might have been successful trading and being the number one trader on Covestor, but I wasn’t successful in teaching. I have this thing called a millionaire challenge, and for the first three years, I had no millionaires. So everyone’s like, oh, you’re millionaire challenged. What, where is it?

1:34:26 It’s a challenge to creep. I was like, in that time, like most of my students start with a few thousand dollars, then within a few weeks two students crossed a million, and now I have several. So I think people just need to be given the chance. They need to be giving instructions, and they need to be giving motivation. Okay, it’s not enough just to give them instruction.

1:34:42 It’s like, you give them instructions, they might follow it for a little bit, but you always have to think, what is the motivation? So the Lamborghinis helped for me at the time. Like, the, the cash helped for me. You’ll actually get a kick out of this. Why do I have 1.6 million Instagram followers and only like three or four hundred thousand Twitter, YouTube, Facebook followers?

1:34:59 Why is my Instagram so much better? I don’t know why. Or bigger, not better. Why? Because when I posted stacks of a million dollars, I had rappers that would steal my photos.

1:35:08 Ain’t Bow Wow? Remember Bow Wow, the Bow Wow challenge? I think so. This was before the Bow Wow challenge. He faked, like, flying this private jet.

1:35:15 He took, like, a picture of this brochure. It was really flying, like just like Spirit Air or something, and I took a picture, and he got called out before that happened. He stole my cash photo and he filtered it and he pretended it was his, and I gave him a call out, because that’s what I did. I’m petty like that. And I said, Bow Wow, why are you stealing photos of my cash?

1:35:32 Like, I’ll teach you the stock market so you can make your own cash, and then you have your own thing to post about. And I signed it, little juju. It’s just like rub it in, and he told all of his followers to attack me, and I was like, oh damn, and he linked my account as, like, what does this mean? So my phone was like blowing up with all these little elves and snakes that’s like attacking on Instagram, right? They leave a little L, and I’m just laughing, like, I don’t feel attacked, like, I’m not getting hurt, and I have literally hundreds of thousands of L’s scrolling on my phone, but then I started getting followers, and I got about 300 thousand followers overnight.

1:36:03 And then I repeated this with the few other rappers who stole my cash photos, and we got featured on TMZ, and each time I got about three or four hundred thousand followers, and I do this two or three times. You’re, look at it, social media pioneer. I mean, I stumbled on it, like when someone steals your photo, I just called them out just as a joke, but I didn’t think that I would use it to, like, double my following. And it worked. Like with the Rhino thing, I donated $250,000, we started Karma Gawa.

1:36:31 I was like, okay, let’s share this. This is an inefficiency. Like, these rhinos are getting killed for the wrong reasons. Let’s create this. Sam Koehler created this masterful video, and we shared it, and it actually didn’t do that well on YouTube.

1:36:43 This is what’s interesting, so you should also try multiple things. So we released it on YouTube, everyone had big hopes for it. He worked so hard on it, and it did really nothing, and then he wanted another try, and he created this little Instagram video, this one-minute video, kind of looks just like a condensed version of it, and that’s the one that had 30 million views. Oh yeah, so you have to try different techniques. This is, we’re tinkering.

1:37:05 We don’t know this world yet. Social media is still new. This wasn’t even around a decade ago. Yeah, it’s constantly changing. Let me ask you a question.

1:37:10 If I asked five of your friends what is Tim’s superpower, like, how can you get all of this stuff done, what would they say it is? What skill set is determination, a dash of psychosis, like, just being obsessed. Most of my friends, if not all of my friends, would say I’m a dick, cuz I just missed their birthday parties. I miss weddings. I miss everything, cuz I’m so focused on what I’m doing.

1:37:33 I’m traveling. They don’t know where I am. I don’t even post usually in real time, cuz now I have, like, stalkers, so they never know, like, which city I’m in. Your stalkers, yeah? I do have stuff.

1:37:41 If that’s the one downside, like, stalkers, or they want to just, like, find you for selfies, both, but it’s never a good thing. Like, one time, I’ll tell you this, this is what scared me, because I sometimes I over share, so this was before, you know, Kim Kardashian got robbed when she posted, like, I’m going to bed on Snapchat, and then, like, the robbers knew she was at home before this happened. I right around the same time, actually, but I said, oh, I’ll see you guys in France.

1:38:06 I’m flying to France tomorrow, and I didn’t think anything of it. It was just, like, a little story that I posted on Snapchat, or was an Instagram, I don’t even know. I’d fly into, you know, Charles de Gaulle Airport. I see my name on the sign. I started following the guy, like, oh, it’s my driver, that’s nice, and it wasn’t my driver, and I started talking to him, and like, he didn’t have, like, a driver’s, I’ve, like, he kind of looked like a bomb, and I was like, what, what is this?

1:38:26 Like, and I realized, like, wait a minute, who are you? And he’s like, yeah, I just wanted to meet you. And I said, how did you know what flight I was on? He’s like, I didn’t. And I was like, it’s like 10 p.m.

1:38:35 He’s like, I know. I’ve been here since 8:00 a.m. and just holding up my, and I’m just, I bought him a coffee. We talked. He was a nice guy, you know. I gave him, like, a free book, but I was just like, oh my god.

1:38:47 I get specific incidences like that help you understand the world a little better. Like, I would never have thought that someone would wait at the airport, for, you know, 14 hours with a sign, not knowing which flight. Only one stock advice. Hey, just want to say it was a nice guy. I was fortunate.

1:39:05 Like, I’ve had good, I haven’t had any, like, bad stuff, but at the same time, like, I rang the closing bell of the Nasdaq a few weeks ago, and I had a whole bunch of people show up, and I was like, I had to be real-time, because you could see me on TV closing the bell, but, like, it was just, like, weird. So there is some risk, so you have to be a little more careful and a little meticulous, because there’s great potential with this platform, but there’s also some risk. Yeah, not for sure, especially in third world countries.

1:39:28 Like, if I’m in the Philippines, you never know. I’m in the Philippines, people get kidnapped there. Yeah, the Americans, that’s true. What scares you to death? The inability to finish what I’ve started.

1:39:39 You know, all the stuff that I have, I have big dreams, but it takes a lot of effort, a lot of time, a lot of money, and it’s gonna take a few years, so I’m worried about that. How do you feel about working on something that has, like, a 20-year time frame, because you’re used to, you know, shorter time frame? I don’t like it. You know, the bigger goal the better. Like, if you look at goal-setting and performance theory, it’s better to have a big goal.

1:40:00 It increases your daily performance 15 to 25 percent, so you should have a big goal, even though it’s gonna take time, and it motivates you, like in any company, any charity, any life. Like, you should have big goals. Like, you should dream massive, and even if you stumble along the way, like, you have that big goal, and then you might even evolve that goal. Like, if you had asked me, like, 20 years ago, would I be teaching? I would laugh.

1:40:21 You’d be teaching, and you’re donating pretty much half of the money that you make to charity? I would laugh out loud. I’d be like, what are you talking about? But I’ve evolved, and I find makes me happy. I think that you always have to find what makes you happy and what motivates you to push yourself.

1:40:38 You know, I’m like, we’re in this life, we don’t know how long we have. You have to try different stuff, and you test. I’m still involved in the stock market, which I’ve, you know, known for 20-plus years, that I love this stuff, but I didn’t know that I would be teaching. All right, like, what, like, why don’t I manage a billion dollars? That doesn’t give me the high anymore.

1:40:55 I have some big trades that I make. I don’t get the same high. I don’t feel the same satisfaction. It’s when one of my students, like, I’ve had a few students pass $100,000 in the past few weeks, and I love that, and I’m like, that’s what pumps me up, rather than if I make a hundred thousand dollars on a trade. It’s nice, because I obviously would be proven right, but I trade with the small account, that would also send me, send the wrong message to my students, if I make a hundred thousand dollars in a trade.

1:41:21 There’s a lot of traders who post big screenshots, and that’s everyone gets riled up, like, oh, I want to make a hundred thousand dollars. No, I want to teach people to make small amounts. I don’t want to teach them to go for grand slams or home runs, because they’re probably going to strike out, but if I can teach them to make little singles again and again, they’ll probably have better odds and better success over time. Yeah, but it’s misleading. Like, if you see two tweets from two different traders, you’re thinking about learning from this guy, he made a hundred thousand dollars, and then you see me, this multi-millionaire, and I’m like, I made two hundred seventy dollars today.

1:41:51 You’d be like, what? And it just confuses people, which I enjoy, and then it starts getting them asking questions like, why are you proud of making $270? How long you live for? Do you know? You thought about it?

1:42:02 I don’t know, but in my ideal world, like, you know, we live a lot longer, and then you can clone yourselves. I’ll be living in a simulation. That’s what I want to know. I don’t know. I don’t know.

1:42:13 I really don’t know. I don’t know. I think that there’s probably some clones walking around. Clones, okay. That’s different than a simulation, or that’s a part of the simulation?

1:42:20 I don’t know the whole specifics. I, I’m pretty sure that we argue against the simulation. It would explain a lot of things in my life. I’m just pretty sure that there’s clones. I mean, we cloned Dolly the sheep like, what, like 25 years ago, two clones, but is it a simulation?

1:42:33 Is it all one big PR video game? I don’t know. The specific Elon thinks it is. Is if it’s a simulation, cool, then let’s, let’s make this the best simulation. Policy, I shouldn’t change the way you live, it shouldn’t, right?

1:42:43 You know, I don’t know how the bigger, maybe how long we’re gonna live. Like, you know, I travel a lot. Like, I’ve, you know, there’s terrorism. Literally, Sri Lanka, at just a few weeks ago, I was there, a few weeks before the bombs went off. I was at the very hotel at that same restaurant, eating breakfast at the Shangri-La in Sri Lanka, and that was a few weeks later that could have been me.

1:43:04 I was in Nairobi, Kenya, feeding giraffes, one of my all-time favorite experiences. Few weeks later, terrorism, not necessarily with the giraffe place, but in that Robie, it’s a little too close for comfort. So we live in, like, these dangerous times. I don’t know how, how long my luck will run, but I’m gonna try my best. You know, I’ve started a lot of things where even if I do die, a lot of people are probably gonna follow up.

1:43:28 Like, I have a lot of students, and a lot of people now involved with my charity. I have this partner, Matta Bad, who’s this amazing photographer, and we’re partners on Karma Gawa, so it’s not just my money anymore. It’s the community and his photography and his whole vision and everything. He’s a creative genius, so I have people helping me now that if something happened to me, I think that they would continue on. What would we be surprised to learn about Timothy Sykes?

1:43:51 Something you do in your spare time besides eating too much sushi? Oh, you’re, you’re heavy metal count is probably too high. It probably is. Oh, favorite piece of sushi? Oh, Toro.

1:44:01 I’m obsessed with, touring. This was the background of my phone. It is delicious, that Otoro. Is it the fat little Toro, to tour, all that stuff? Yeah, okay.

1:44:09 I love sushi. You know about yellowtail? I like a good piece. I love yellowtail. I’m staying in the Nobu hotel.

1:44:13 They have the yellowtail jalapeno with a little cilantro. Oversharing. It’s amazing. That’s not an overshare necessary. You haven’t had that?

1:44:21 It’s right down the block. You should have that. Yeah, I went there for lunch. It’s amazing. All right, so sushi.

1:44:26 What else? Anything else we’d be surprised to learn? I mean, I share everything. Like, I, people know this stuff about me. I don’t, I don’t know what, what’s there.

1:44:35 I’m allergic to cats. I don’t talk about that. I guess I don’t have a cat around. My phone, my face will just blow up. That’s enough.

1:44:42 What keeps you awake at night? Nothing. I pass out pretty hard. I take a position, you know, Tylenol, simply sleep gets me, like a charm. Family.

1:44:52 Someday, eventually, you know, I, for me, I just have so much I want to accomplish, and I can, I can’t do everything, but you know, I’m sure it’ll happen eventually. And the nomadic thing is just something you’ve always felt because you didn’t do it early on. I mean, I’ve traveled a lot in my life. I’ve been to 120 plus countries now. I was in tennis Europe when I was a teenager, is going around Europe playing tennis.

1:45:17 I was on Semester at Sea, going around the world on a cruise ship. You know, I love that. Bug early. I got the bug early, but now my travel is evolved. Like, I don’t go to, like, fancy tourist places.

1:45:28 Like, there’s only so many fancy pools and piña coladas that you can drink. From now, filming, I go to Sur Woor La hotels. You go do, right? I love shaking a lot. Antastic.

1:45:36 They’re fast Wi-Fi, but I go to a lot of third-world countries where they don’t have Shangri-Las. They don’t have anything, and I still get a lot of enjoyment, if not more enjoyment, going to a place where, you know, some of our schools in Indonesia are. In Bali, in Kintamani, this small little town in the north of Bali. You know, we just opened some schools. Matt was there.

1:45:55 I couldn’t even make it this past time. We opened four schools. Some of the people have never seen any Caucasians before, and you know, we’re opening schools there because, frankly, tourists don’t see them. I mean, they need help. Like, a lot of the communities in Guatemala with Pencils of Promise.

1:46:07 We drove for six, eight hours to build these schools in the middle of nowhere. They need it. Education is the key, and they have no education. Like, forget about us in, like, trying to get them motivated to watch YouTube. Like, some people have no education whatsoever, and you basically are condemned to a life of poverty, because you have no skills, you have no potential, and you’re just begging tourists, and that’s not a way to live, ya know?

1:46:31 That’s for sure. I’m Tim. I always ask everyone a few questions, and I’m gonna ask you, if you could pick up a phone, a magic phone, and they could call it, to 20- year-old Timothy Sykes. I guess you’re at Tulane University at this point, right? Yes, and give him some advice.

1:46:44 What would you tell him? Um, but the PO, you know, drink less. Know the PO boys are delicious. Have an extra PO boy. Don’t drink as much, and start studying.

1:46:55 Like, get on with YouTube. Back then, I don’t remember, get on whatever technology was available at the time, and start studying. Listen to podcasts. Watch video lessons galore, not just on trading, but really buff up on your education. I would give this advice to anybody who tells me, like, ask me right now, like, what should I do?

1:47:14 Start studying and start clicking around. There’s a whole movement, like, oh, get off your phone, get off social media, screw that. Get more on social media, get more on your phone, ignore everything else around you, because this is what you have in your hand, and on laptops, that is the future. And the more that you prepare yourself, I say, trading is a battlefield. The world is a battlefield, and it’s an educational battlefield, and too many people are unprepared for battle due to a lack of education, so we need to buff up on that.

1:47:42 And you can do it. Like, we have this tool. You don’t have to go to college. You don’t have to go into student loan debt. Don’t even get me started on that stuff.

1:47:49 You can learn everything on this tool that too many people just use for, like, little animal ears and filters and stuff. Like, they use it in the wrong way. I think social media is dangerous if you use it in the wrong way, and you’re just looking for gossip and what other people are doing, but if you use it to educate yourself and empower yourself, it’s fantastic. Should people go to college? Are you on the Peter Thiel?

1:48:08 I can’t. No, I mean, save your money, and just, you can do a self-college. It’s all online. Why are you ignoring the single-most invention in the world? Like, this invention came out, and literally you have, like, half the world being like, yeah, what if they embraced it?

1:48:24 And you start clicking around, and for me, education is fascinating, because you start clicking around. You don’t know what you’re interested in. I didn’t know that I was gonna be so interested in charity. I built one school to compete with my friend Neil. Then I went to these countries, and I started, and then it became addiction, and then it wasn’t enough just to build a school.

1:48:40 I wanted other people to get into it and see how amazing it was, and I get messages every day. You know, the Rhino video, I want to include this one. DM, that I got. It was a fascinating DM from this teacher, and she said, I don’t know, she DM’d Karma Gawa, and I read all the DMs, and she did me, and she’s like, I don’t know who you are. I don’t know what you guys do, but five of my students in fifth grade changed their class subject to protecting rhinos, and these are kids who never cared about the world before.

1:49:05 So I don’t know what you guys do, but keep doing it. And she even understand. She was like, is this a DM? Like, she’s not technologically savvy, right? But she hit us up, and she said that five students in her class of, like, twenty kids changed to rhino conservation because of the one film that we made.

1:49:21 What have we do? That, and we that up two more kids and more different students, and not just students, adults, and everyone starts caring about these things. How would the world change that? That would be fascinating. Do you work at the time you spend at Tufts and Tulane?

1:49:34 Oh, okay. I don’t regret my day went. I don’t regret anything, because it got me to the place where I am, and I’m so thoroughly happy with what I am doing right now, but if I could go back in time and warn myself, I would say, skip it, like, you don’t need it. Okay, I usually ask, best advice you’ve ever received, that I might ask you, best trading advice you ever received, or either one. They’re both, they’re one and the same.

1:49:56 Um, before my $500,000 loss, I had, like, a three million dollar hedge fund, and I was going around to different investors trying to, to raise more money, and James Harris of Pi Capital, this older gentleman, said, Tim, I love your strategy. I love your, your work ethic. It’s great, but I’m not gonna give you money. And I was like, why? And he’s like, because you haven’t been scarred yet.

1:50:17 And this was before my big loss, and I was like, what is this old guy? And I went out of there like, just, like, wow. What does he, doesn’t know anything? Then, like, it was like a few weeks, or a few months later, and I had the big loss, and I was like, ah, he was so dead on. Like, people are so afraid of losses or mistakes or failure, and they don’t realize that’s a key component of their education.

1:50:37 You need to be scarred, because I wish that I had been scarred earlier. Right? Like, you should look forward to making a mistake. Like, I don’t know about, like, fail fast, you know, fail often. Maybe that works, right?

1:50:49 Or maybe then you get your co-founder telling you to break up Facebook later on. Did you see that video? That’s crazy, right? Um, for me, I love that mistake process where you learn what not to do. Like, I think that we’re all kind of like newborn babies, and if a newborn baby is thirsty, it just wants water, and it’s a newborn baby, and it doesn’t know, and it sees, like, a bottle of water and there’s steam coming out of it.

1:51:11 They don’t know what steam is, so they drink and they burn their tongue. Alright, we’re never gonna drink the steaming water again, because they’re gonna learn that that’s hot water. That’s what we have to learn. But too many people are afraid to make mistakes, especially publicly, or have losses or big failures, and so they never learn that lesson. They never learn the lessons that really stick, that allow them to get to the next level.

1:51:31 Yeah, last part of that question. That 20-year-old is watching us right now. Yeah. Advice to them: study, study, study, study. Stop going out with your friends.

1:51:40 You have to, you have to change your priorities. You have to really prioritize yourself. It’s like the value of selfishness. Build up yourself. Build up your education.

1:51:51 Build up your mind, so that, you know, by age 21, 22, 25, 30, you can be better prepared and better equipped for the world, because most people at 20 or 16 or 18, I pretty much, all their teenage years, or even all the way up to, like, 25 or 30, they’re not doing that much for themselves. They’re praised any time. Wasting time finishes the wrong priorities. I think, like, you know, like when I first made my million dollars, I ignored my friends, and everyone thought I was crazy, and I was studying the stock market at night.

1:52:23 Timeline was closed, but I was looking at charts galore, and I was obsessed. I became addicted to educating myself about the stock market, and that’s what led to my success. And yes, maybe I’d probably take it a little too far. Like, I probably should go hang out with my friends a little bit more, so maybe I’m not, like, the perfectly balanced. I miss my college graduation for a stock trade.

1:52:42 I do regret that, even though I made a few thousand dollars. I’ll never get that colored group college graduation back again. Apparently they call my name twice. My parents and my grandparents were sitting in the audience in New Orleans, and I just wasn’t there, and I was like, I’m sorry, I have a trade. So I think I could probably do a better job with that, but at least I, I prioritize myself.

1:53:01 Most people would never think of that. They would never say no to their friend. They value their friends above everything else. And for me, I think, you know, going back to, like, the airline safety video, where you put your mask on first before helping others. It does you no good if you put a mask on somebody else, then you pass out, and you’re trying to put it on somebody else and you can’t even reach, because you pass out, because you didn’t protect yourself first.

1:53:21 I think that there’s a lot of value in being selfish, so that you can better yourself and then help others. Invest in yourself. Yeah, invest time, money, effort. It’s not just about free resources. I wish more people would say, like, oh, I can learn everything on YouTube.

1:53:36 None of my millionaire students came just from YouTube. Okay, you too, might be good for beginners, but then there’s a lot more premium content, and you shouldn’t be afraid of, like, that’s the best money that you will ever spend. And I’m not saying, like, waste, like, 40 or 50 grand a year on college. Nothing on the internet cost that much, right? Billy, have you spent a few hundred dollars, a few thousand dollars on your education that pays dividends exponentially later on?

1:53:58 What can you do today, this week, this month, this year, to put yourself in the best position five years, ten years, twenty years from now? And people don’t think like that. They don’t think that, you know, for we’re thinking, they don’t want to waste the time right now for something that might pay off in ten years. But if there’s one thing that I’ve learned from teaching now for 10 plus years, it’s that you learn quicker than you think. Like, there’s a lot of work in the beginning, but you really understand everything.

1:54:21 Like, I have some really dumb students, and they learn everything in year two, year three, year four max. Like, I would teach Forrest Gump everything inside of five years, and he’s not a smart man, but I could teach him, and that’s the beautiful thing. Like, nothing that you put your mind to will take, like, ten years, maybe, if you’re, like, a doctor. I’m not talking about, like, rocket science or doctors. I’m not that smart, but a lot of the stuff that can change your life, you can learn everything in a few months or a few years.

1:54:47 Yeah, I’m dedicated. Most of us are too harsh on ourselves on the short-term goals, and we don’t realize how much we can do in these long-term goal person. So if you just do that one percent every day and get better, and get better, you’d be surprised what you can educate. It is very front-end loaded. It takes a lot of effort.

1:55:00 It’s very confusing. It’s always hardest in the beginning, but it pays off so much quicker, and then it pays off exponentially. This is the same thing with, like, medicine and technology. You know, like, you get a few breakthroughs now and then you build off those breakthroughs, and then everything goes up exponentially quicker. I think that’s why I think, okay, maybe cancer won’t be cured right now.

1:55:18 In six months, but inside of a decade, I think that at the rate that they were making breakthroughs, I think that there’s a greater probability. Yeah. Tim, you’re not what I expected you’d be. You’re fascinating. What did you think?

1:55:30 What do you look like? We were talking earlier in my office. It’s like we all have this weird media bias, because we see people by their Instagram feeds and all this stuff, and your nose, the penny stock guy. Yeah, and you know, you got a history of, you know, floating around, and Lambos and that Ferraris and all that stuff. So, but you know, your life is more than just trust op trading.

1:55:45 It’s tough to share all this on social media. It takes a multi-hour interview, so thank you for getting me the chance. My pleasure, and I love how these lessons, traight go over to life, you know? If people actually have the discipline to trade or learn a martial art or whatever, the education, it’ll pay off massive dividends, and their emotional, creating his life, and that’s the beautiful thing here. It’s not just about the money.

1:56:04 Like, it teaches you so much in cutting losses, especially with toxic people. That’s probably one of the most important things that’s applicable for everybody watching this, because everyone, I think, knows somebody toxic in their life, and they probably give them a little too much leeway, and they really need to just cut it off and move on to something better, because there are a lot of good people if you give it the chance, but too many people are stuck with losing positions, losing relationships. Yeah, I’m ruthless when it comes to that, so it’s good.

1:56:30 Yeah. Um, also, your training stuff is incredible. It’s really interesting to learn, and you’ve got a lot backing it up. It’s not just some, some, some scams, some weekend thing. It’s like a lot of thought going behind it, a lot of videos, a lot of free information, and a lot of really intelligent.

1:56:43 Yeah, do you, so a pre-show, 20 plus years of trades too, in case anybody doubts it? I show every single trade that I’ve done for 20 plus years. That’s how crazy I am. That’s crazy, man. No wonder you’re hanging out with the Game of Thrones people, whatever.

1:56:55 I can do. Um, Tim, I really appreciate you coming here. I really love your story. Keep doing what you’re doing. I’m gonna look into this charity work.

1:57:02 My bed, and I have to build a school bigger than yours. Yes, to get started, yes, competitive millionaires. That’s what it’s all about. So everything I’m doing here is one big charity effort. Yes, maybe it’s time for some more.

1:57:11 Yeah, name a country. We’ll all connect you, because we always connect with, like, different local charities, cuz they know what to do. They’re working with, like, the communities and the government stuff, like that, but you can build a school. It’s, I promise you, it’s like the best feeling in the world, and then you build multiple schools, and you start changing communities. That’s fantastic.

1:57:27 That’s incredible. All right, well, until next time, Tim. I really appreciate this stuff, and let’s definitely do this again. For sure. All right, thanks, man.