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Gary Tanashian – Trader Interview

Q. What’s your name? Gary Tanashian Q. What is you website address? http://www.biiwii.com Q. Can you give us a little bit of background about how you got involved in Trading and what led you to become such an expert? Well, I think expert is a strong word because I don’t believe anyone ever masters trading.  I have some things that work for me much more often than not however. As for my background, it is actually in business as the owner of an American manufacturing company where I developed an interest in macroeconomics while niching the company’s successful place in the world.  From macroeconomics, I began looking at market sectors and the stocks therein. I do not trade stocks exclusively on technicals, even though TA is probably my strongest area.  A given sector must be in alignment with my view of the macro landscape.  This helps me be a strong holder when necessary.  I find I would be a weak hand when holding something for purely technical reasons and frankly do not have the time to baby sit positions.  So also you can gather that I am more of a swing trader than flipper. Q. How long did it take to you to become really become proficient at Trading? About four years.  The bear market of 2000-2003 taught me that I was good at market timing; trading those huge bear rallies and declines.  It was like a meat grinder, but it got me attuned to the market’s rhythm. Q. What markets do you trade? Is there any reason for choosing them? At this moment, the gold market.  Specifically the gold miners.  The reason is simple, the gold stocks as represented by the HUI and the EFT GDX, are making what I believe is a historic bottom.  I am not necessarily bearish the US Dollar as measured in competing currencies, so I am not like the gold bugs who can tend to have an us against them mentality. What I see when I look at gold’s ratio to oil, to industrial metals and to human hopes for prosperity is hockey sticks!  Just like what the USD did in October.  The same forces that drove up the Dollar drove up gold’s ratio to gold miners’ cost inputs!  It is the play of year and likely the start of a new bull markets. I am also bullish broad markets for an extended trade, not due to fundamentals but rather due to technicals and historically bad sentiment. Q. Would you view yourself as a fundamental or a technical trader? If both what percent to give to each? Fundamental 40%, technical 60%. Q. Are you more a systematic trader or discretionary trader? Definitely a discretionary trader, using a good dose of instinct. Q. Is there a certain instrument that you like trading? I.e. options, shares, warrants, CFD’s, futures, forex? I mostly trade shares and once in a while a few puts and calls. Q. Are there any specific strategies that you trade? Can you provide any details of them? I am a bottom feeder, pure and simple.  I see an inverted head and shoulders or massive falling wedge with bullish divergence by indicators like MACD and RSI I get very interested.  I will also look for trend by AROON and confirm with Wm%R and when I see several indicators hinting at reversal, see a bullish pattern and some clear support and resistance points all showing a confluence toward a given outcome, I then pay close attention.  But I must be on board with the fundamentals as well. If you are in a take-profit situation and your system is telling you to exit rather than hold on, how do you bring yourself to exit even if it’s still running in your favour? I do not have seller’s regret.  Well, maybe just a little.  But it comes with the territory and emotion should not be part of the equation. Q. Do you or your systems trade every single day? No. Q. How do you react to the winning and losing streaks? Even keel.  Act like I have been here before.  The market can be very humbling so I may as well make an attempt at humility on my own before it is forced down my throat. Q. What is the most important part of that discipline? What is your golden rule? Keep that emotion contained.  I am not the genius I think I am and I am also not as dumb as some trades have made me look.  If you show up with a brittle ego, you are done. Q. What charting systems do you use? I use stockcharts.com.  I really do not watch live charts that come with my trading platform.  Again, I try not to micro-manage positions. Q. What news/broker services do you use? None, except as contrary indicators. Q. What portfolio management / trade tracking software do you use? Fidelity Active Trader Pro Q. What kind of risk do you take on a position? When if ever would you increase this risk? It varies.  Throughout the bull market from 2003 to 2007 I was pretty pleased with the fact that I managed risk at ALL times by generally keeping a 50% plus cash position and still doubled the bull market’s performance consistently over that period. As a bottom feeder, I will increase risk at a time like now for instance, when the crowd is frightened.  Of course the opposite holds true as well and when the herd gets over confident, I decrease risk. Q. Do you use stop losses and things like that? Very rarely. Q. How do you handle your position sizing for each trade? It varies.  I generally have many positions and each position is weighed against the overall portfolio. What was your best trading day/week/month? What was going through your head? I am sorry, I cannot recall to that level of specificity.  But I will tell you what was going through my head; I just KNEW I was a genius, so I sold a bunch of stuff before the market taught me it wasn’t true. Q. What do you find so good about Trading and the markets? It allows me to match up against a massive, emotional and sometimes very predictable collection of other human beings.  It allows me to practice something that comes pretty natural for me, a contrarian outlook. Q. Do you remember your very first major trade/win? No. Q. Can you recall your worst trading day? How did you deal with it? Yes, I was on my way to get a root canal.  I checked the market in the waiting room on my Treo phone.  They called me in and I told them the procedure would be a welcome change from the day I was having. Q. What do you consider are the characteristics of a successful trader? 1) Keep emotion out of it. 2) Keep emotion out of it. 3) Keep emotion out of it. Q. If you had one secret to give about Trading, what would it be? Keep emotion out of it. Q. Any further comments you would like to add? Thank you for the opportunity to give one trader’s view.  I realize there is a lot of sharp people out there with good systems that work more often than not.  My thing is basically just a good b/s detector, a firm view on sector fundamentals and charts.  I am actually quite simple as a trader compared to some folks who have really gotten this down to a science. I would personally like to thank Gary for taking the time to reply and provide some insight into his style of trading. James Ramsay Visit www.otrader.com.au for more interviews and a Free 20 trial of our Stock and Option Portfolio management Software