As part of our new Trader Interview series, we will be getting in touch with seasoned market veterans to pick their brains for a little bit of strategy and insight. If you have any particular questions you would like us to ask, then please feel free to get in touch, just send your requests to firstname.lastname@example.org
In this interview, we got in touch with PLTfx which is a boutique trading advisory that has been active for over five years now. For those of you active on twitter, PLTfx will no doubt be well known to you as they regularly post insightful market commentary and have a loyal following. PLTfx is run by private traders who choose not to disclose their names.
First of all, thanks for taking part in the interview and to kick things off, can you tell us a little about PLTfx.
Thank you for getting in touch. We began as private traders who simply used Twitter to engage other traders and share charts from time to time. The trader community on Twitter was really blowing up between 09-11 and we started to get requests for more timely alerts as to the trades we were taking. So, it really just grew from there and always as a response to demand. We began offering educational content and now also run managed accounts.
Can you tell us a bit about your strategy? If you use any indicators, the sort of time frames you trade, holding periods etc?
PLTfx follows two core strategies, Tactical and Trend.
The tactical strategy is more near term (1-3 days) in nature and seeks to take advantage of price and time patterns that have a high probability of repetition delivering a reasonably predictable outcome premised on a fixed risk reward metric that will deliver an edge (positive returns) over an extended series of outcomes.
Our trend strategies are more medium-term approaches (1-3 weeks), they are also premised on price and time patterns but also take into account additional factors such symmetry, seasonality and flows in an attempt to capture broader market moves.
What is your approach to stop losses and profit targets, how do you set these?
Our tactical strategy uses a fixed stop based on instrument volatility. Our trend strategy uses structural stops based on a trade thesis invalidation point.
[Tweet “We consider trading to be a speculation NOT gambling”]
How do you take news release into account when you are trading?
Our strategies are price based, and we believe that all that can be known, or is known, is baked into the price. We accept supply or demand shocks premised on headline/event risk as a cost of business. We don’t take sizeable risk infront of significant headline/event, risk; we consider trading to be a speculation NOT gambling.
You run educational services, do you teach traders your exact methods in these sessions?
We run a bespoke one on one mentoring service whereby we teach traders both the mental and technical skills to track and trade the exact patterns PLTfx trades
What is your main focus in terms of performance, is it managing downside or delivering the highest returns possible?
Always the downside. Our approach is premised on capital preservation before profit, we manage the downside rigorously, and the upside will take care of itself over time.
[Tweet “You have to be able to rely on your broker to deliver excellent market access”]
How important is choosing the right broker when looking to achieve success through Forex trading?
The right broker is a critical aspect of our trading business plan. The additional costs associated with your brokerage relationship must be managed as conscientiously as possible; it is important to grade that relationship on execution and associated costs especially during volatile market conditions. You have to be able to rely on your broker to deliver excellent market access.
As you work with lots of new traders, what would you say is the biggest mistake that most new traders make?
Focusing on win rate instead of trading process. One of our main market mantras at PLTfx is ‘process over outcome’. Our role is to consistently apply and execute our trading plan not to focus on the outcome of each individual trade.
[Tweet “Get serious about studying the mindset, markets, methodology and money management strategies”]
What would be your one key piece of advice to aspiring traders?
Get serious about studying the mindset, markets, methodology and money management strategies to be successful or take your cash to Vegas – A much more enjoyable way to lose it!
Do you feel like the markets have changed much over the last five years?
Markets are continually evolving and if history doesn’t rhyme it certainly repeats. If you take the time to learn the patterns that replicate in all markets, you can become consistently profitable once you tame the trader in the mirror.
For traders looking to learn to trade Forex, which route would you suggest they take?
As with anything model success/excellence, find a mentor who you feel represents the success you seek and model yourself on them and their approach. It won’t instantly make you a success, but you can learn from the mistakes they made on their journey to success and use them as a shortcut to yours.
Well thank you so much for taking the time to answer these questions, I’m sure our readers will appreciate your answers as much as we do.