Joe Ross Interview
How long have you been trading for?
How did you first get involved in trading?
I was taught by my great uncle Julius.
Do you remember your first trades?
Yes, it was a cotton trade. My uncle had a seat on the cotton exchange.
What were your first few months like? Were you profitable initially?
My first few months I was petrified. But I traded profitably under my uncleís supervision.
Has your trading style changed radically from when you first started?
No! I was taught discipline and self-control. I was taught to find the markets and time frames that best suited my trading style. I have always done it that way.
How did you learn to trade?
My uncle showed me what the market was all about. It taught me how the market moves and why. Once I had that knowledge, I was able to develop a trading style that fit my personality.
Are you a self-taught trader, or did another trader teach you worthwhile lessons?
My uncle taught me self-discipline and how to approach trading. Once that was done (1 Ĺ years), I became a self-taught trader insofar as technique. I developed my own strategies and tactics to carry out those strategies to completion.
Trading - In Practice
What is your basic approach in analyzing and trading the markets?
I follow a regular procedure: 1. Determine which market(s) best fit my immediate trading goals. 2. Choose a trading style to fit that market(s). 3. Determine how best to trade that market(s). Determine what are reasonable trading objectives. 4. Determine trading size. 5. Determine stop placement.
How would you define your trading style?
Eclectic. I go where the money is to be made.
How often do you make a trade?
That depends on the market(s) Iím trading. I make a great effort to not overtrade. By that I mean I donít trade any more often than I need to, nor do I trade any size larger than I need to, to meet my trading goals.
Do you prefer to trade long or short and why?
Makes no difference to my. Iím dyslexic. Up or down look about the same.
How do you pick your trades?
Very carefully, according to my preset rules.
Is there anything you can single out as the most important element in deciding to put on a trade?
It must look right, feel right, and have my name on it.
Do you use trading systems?
Sometimes, but only ones I develop myself, and with the realization that no trading system will work for very long. I always have another one ready to go when the current one stops working. But mostly I trade from what I see.
How much do you risk on any single trade?
I will never risk more on a trade than the amount I have set for my first objective.
Do you use stop or limit orders?
Sometimes. I believe the type of order used must fit the strategy you are attempting to complete. Orders are strategic. If you canít get the job done, what good is the strategy? As much as Iíd like to, I canít buy ďmarket on low.Ē But I could certainly come up with some wonderful trading strategies if I could.
Do you use chart patterns such as reversals and breakouts?
Sure. All patterns deserve some attention. But I prefer well defined trading patterns that are currently working in the market.
Do you use Level 2 data to trade?
No! Level 2 is a distraction, as far as Iím concerned. I see very little value in Level 2 data. I want my focus entirely on the price action. Level 2 is very convenient for those who would like to fake me out, and make me think the market is going one way when, in fact, it is going the other way.
How do you decide when to take profits?
Pretty simple: When they are there! If I have profits in a trade you will not easily get me to give them up.
Is slippage/bad fills a problem in your trading?
Do you use the opinions of other traders in making trading decisions, or do you operate completely solo?
Opinions are worthless in the markets. I donít even trade my own opinion. I canít help but have one based on what I see. But I write it down in order to express it, and then crumple it up and throw it in the trash. I trade solo, based strictly on what I see.
Trading - The Theory
What are the trading rules you live by?
Keep losses small and controlled and the winners will take care of themselves.
Do you believe chart reading can be used for successful trading?
Absolutely! As far as Iím concerned chart reading is the only way to go. The chart shows you the most current information possible on which you can make a decision.
Are there any technical indicators that you have found to be particularly valuable?
Bollinger Bands when I want to trade option boxes in a sideways market. Commodity Channel Index when I want to stay in a trend longer than you might normally stay in.
What are your thoughts about using fundamental analysis as an input in trading?
I never use it. I havenít the time, money, or research capabilities to properly trade from fundamentals.
Do you ever use contrary opinion as an aid to trading?
Only for my personal stock trading and investments.
How important is having a sound risk/money-management philosophy?
If you want that on a scale of 1 Ė 10, I would say a 10.