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Interview With Matt Choi, Founder And Chief Strategist Of Certus Trading

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Matt Choi of Certus Trading is a CMT (Chartered Market Technician) who specializes in trading stocks, ETFs, options, commodity and financial futures, and FOREX. After obtaining his MBA from Hamilton’s McMaster University, Matt owned and managed a successful car dealership while trading on the markets on the side. In 2011, he sold his business to focus full-time on his passion for trading, forming his trading education company, Certus Trading, in the process. A rules-based trader, Matt’s specialty is swing trading and he believes the opportunities in this field are, in many ways, limitless.

We spoke with Matt Choi about his business and how he has achieved success as both a trader and trading educator.

Matt Choi

Q: Can you tell us more about your company, Certus Trading, how it got started and why you decided to get into trading?

A: My first exposure to the markets was when I was about 11 years old. I was living in Hong Kong and my maternal grandfather was a stockbroker and investor. In the afternoon, when I was done with school, he would take me to the Hong Kong stock exchange where he would trade. There wasn’t internet at that time so everything was manual. As a kid, I couldn’t go inside the exchange so I would just stand outside and wait with a lot of other people. Outside, there were these monitors with green numbers. I would look at these monitors. I had no idea what the numbers meant at that time or what they represented until my grandfather started explaining to me what he was doing during our 45 minutes bus ride to and from the stock exchange.

He explained his trading philosophy, what he was doing, why he was doing it, what stocks were, why people trade stocks, why it’s a good profession, and so forth. His successes and my fond memories of spending time with him inspired a lot of my trading successes.

I moved to Toronto when I was in seventh grade, and being new to the country at that time, I was more focused on immersing myself into the Canadian culture. I didn’t think about stocks again until my MBA studies. It came pretty naturally to be honest. I kind of credit it back to my days with my grandfather going to the exchanges. I won several trading competitions, which caused my interest in the stock markets to reemerge provoking me to put a lot of my own money into the markets. It was the era of the Dot-com Boom and I made a lot of money, just like a lot of other people. And, of course, I lost most of it in the crash shortly after that. I just quit achieving any kind of consistency after the Dot-com era. I just could not get consistent with my trading.

I tried many different styles – I tried long-term investing like my grandfather did and I found I had no patience for it. I tried day trading because I liked the concept of it, the idea of being done for the day and not have to carry any position overnight. That got me interested and I did pretty well. I made good money from day trading but it was tiring. Automation was not as good back then so you had to be on your game and constantly focused throughout the day. That will be almost from 9-5 and even after that I had to do some research, testing, and development at night to make sure that my formula, my patterns, were all working. It was just way too much.

After that I didn’t quite know what to do. I started looking for help. I’m the type of guy who, when I’m curious, I want to look at people who are already doing this, who are already successful. Why reinvent the wheel when you can learn from somebody who has already walked that path? I worked with a couple of mentors but there was just no chemistry. That was until I met George Fontanills. George was my mentor for a couple of years. Now, every time I talk about this I get emotional because George passed away quite suddenly a few years ago. I owe a lot of my success to him, he mentored me for a couple of years and of course he taught me a lot about trading and what it takes to become a successful trader.

Being successful is not quite what you think. It is more than just strategies and formulas. You need to find a trading style that fits your own personality. George would observe how I traded and the mistakes that I made. He decided that swing trading fits me the best. He understood that I liked to travel but at the same time I just don’t have the patience so, short-to-medium term time frame works best for me. Fast forward many years later, I’m usually in my trade for a couple of days to a couple of months and this gives me enough time for the stock, commodity, or currency to move some distance so that I can capture meaningful profits.

What is Certus Trading and why did I start it? Certus is a trading education company to help people achieve their dreams of obtaining trading mastery. That’s what I did and I want to teach people how to do the same thing. I’m passionate about trading and I love seeing people succeed. One thing that I do that is a little bit different is that I only want students who already have a winning mindset. I want someone who is responsible, who is accountable for their own actions because those traits are hard to teach. I don’t want people who are constantly making excuses, and that’s why the majority of my clients have become very good traders themselves. Some are even trading much bigger accounts than me now, which is fantastic.

When it comes to why I started Certus Trading, I can give you three reasons. Number one, I find trading to be very dynamic and very challenging, and as I’ve always done quite well at the things I have tried, I enjoy this challenge. When I was in the corporate world, I was moving up the ranks, climbing the ladder rather quickly, making over 100K in my mid-twenties. Then, I got bored at the corporate world and I bought a distressed business, turned it around, and sold it for multiple seven figures. But with trading it was tough. I’m used to winning all the time but with trading, I can only ever be 70-80% right. Nobody’s perfect in trading. The market is just too big, too dynamic for anybody to be a perfect trader which means I need to live with the 20% failure all the time. That challenges me to become better so teaching keeps me humble. I need that to keep me ground as a trader. When I teach, it reinforces myself as well to become a very disciplined person, a disciplined trader where I follow my rules and I stick to my guns and I don’t make impulsive decisions.

The second reason is for diversification. I have knowledge, I’m a good trader, I’m successful. Why not monetize that and, at the same time, help other people to achieve their dreams too? It’s basically a two-pronged approach: teach what you know and teach what you’re good at and make that a business as well. Number three, and by far this is the most gratifying, is when I get emails, phone calls, in person even when I get information from my clients, telling me how I helped them change their lives or how they made money from trading to payout their house or the day I heard from a guy who’s finally able to retire. Somebody who pays for their kids’ education, somebody who uses their trading profit to pay for their surgery, to pay for their dream family trip. This is enormous motivation for me to keep doing what I do.

Q: You gained experience not through a professional trading firm, but by trading your own money. Can you explain how and perhaps why the self-taught approach worked for you?

A: When you said professional trading firm, I suppose you meant the big institutions like hedge funds and investment banks. With these big trading firms, there are four major factors so to speak. Number one, they look at macro ideas like the economy – employment, interest rates, exchange rates, typically, they take a longer term approach. If you like that, that’s great. Number two, they have a lot of inside scoop such as corporate performances, financial results, mergers, acquisitions, information that main street guys like you and I just doesn’t have. Number three, they have super fast technology. In recent years they have adopted High Frequency trading by being physically close to the exchanges, so the closer you are to the Chicago Board Options Exchange, the closer you are to the New York Stock Exchange in combination with having the highest speed connections and computers, the transmitted and received data really gives them an edge. This is not about skill, it’s strictly about being faster. And number four, they make a ton of money from customer commissions and transactions. So, if that’s the kind of factors that challenge you then these large professional trading firms are for you. But that’s not really for me. I prefer looking at the micro opportunities versus the macro, which is the daily movements, stocks, options commodities, and currencies. I look for repetitive patterns that appear so that when I see that same pattern again, I won’t be far from it and I will have a strategy that I derived to trade that specific pattern. Now, what I just described takes a lot of curiosity and persistence. And it is also a process of elimination which I enjoy and that’s why I think the self-taught approach worked really well for me. I also fast tracked by having George be my mentor. He probably saved me a good five years of struggle if I had to really do the estimate so definitely he had a lot to do with my success as well.

Q: Many traders are secretive, but you want to share your knowledge with others. Can you tell us why?

A: It is a bit of a selfish reason. I like to be right. So, by sharing my knowledge, I get the satisfaction knowing that my trading work is great as confirmed by my students and by my clients. And, at the same time, I get to change people’s lives and help them achieve their dreams simply by teaching my passion, so, why not share? I love getting to know my clients. When I first started Certus, I thought, it’s really about trading. It was all business, teaching them strategies and how to trade. However, as I get to know my clients, as I get to know they work, their life, their families, it has become much more rewarding and fulfilling. It’s no longer just about trading, it’s about my mission to help my students become the best that they can be so that they can in turn, pay it forward, and help those around them who need help. This has been extremely gratifying and rewarding and that’s why I have no problem sharing my knowledge with other people.

Q: What can people who sign up for your courses expect?

A: I don’t hold anything back with my students and my clients and, just as important as teaching them the trading strategies, is telling them my journey of getting there. I can tell them they need to get from A to B and here is the strategy to do that but there are a lot of pitfalls and landmines in between. Knowing how to navigate around those pitfalls is extremely important. And even more important is how to get up after getting hurt from a landmine. We have losing trades, we do things that we’re not supposed to do, we’re human, we make mistakes. How we get up and keep going without being discouraged is just as important as the strategies themselves.

Mistakes will be made in trading. It is how to avoid them going forward that’s important.

I also focus on discipline with my students. Before joining my programs, I make sure that my students are responsible, accountable, that they are willing to take action. If not, I just tell them not to bother joining because they will fail. So, it’s a two-way street. My students can expect me to give them my best and crack the whip once in a while to make sure that they do stay on course.

Q: What can would-be traders and other entrepreneurs learn from The Winning Way, the book you co-authored about your trading strategies and your entrepreneurial spirit?

A: I was fortunate enough to be selected to co-author the Winning Way with Brian Tracy and other trading leaders from around the world. In the book, I talked specifically about the three psychological mindsets that one must have to beat the markets. Having the right mindset is the foundation of success, not just trading success but in achieving anything in life. It comes down to discipline, being accountable, and always having an unbiased opinion to keep an open mind. That’s of supreme importance.

The three mindsets are as follows. Number one, you need to be able to accept market uncertainty. There are millions of people each day participating in the markets and a lot of the time it is unpredictable. The key is to accept this uncertainty and to wait and only pull the trigger when there is a repetitive pattern. And these patterns appear over and over again and take action to profit from. So, when this happens you do. Why? Because typically, it profits 80% of the time. That’s the kind of opportunities we’re waiting for. You have got to be patient because you know that the market is uncertain most of the time. You have got to wait for the moment.

Number two, you have to focus on the present. Let’s say you have a strategy that has been working well for a long time. Then, all of a sudden, you lose five in a row. Most amateur traders will abandon that strategy and move on to something else and then the strategy resumes working shortly after and they missed out on the profits. Most people put too much emphasis on the past and freeze when a losing trade occurs. That’s why robots are good traders – they have no emotions. They take the trade no matter what happened last time around. We need to remove the emotion and focus on the now. Trust your strategy and use it over and over again during the same situation understanding that, in the long run, you will succeed.

Rule number three is that you have to think in probability. Whatever strategy I developed, it needs to beat the odds in the long run. That’s the reason why I like to trade repetitive patterns that are quantifiable. I either win or I lose. In general, I trade strategies that can win 70-80% of the time or better. I think if you have all three of these mindsets solidly ingrained in your brain then you are halfway there as a trader.

Q: Can you tell us about your mentor, George Fontanills, and how he influenced you?

A: I worked with a couple of other traders before I met George. One of them was really a good guy and he used a value investing approach. He used the method of buying a stock at a cheap price and sell them at 20% higher. He taught me all of his strategies and they do work and I’ve done well with them. However, to me, the approach was uninteresting. Every week I’d be itching to make a new trade or to make a trade adjustment or to buy more stocks but, this approach doesn’t call for a lot of action so I had a tough time following the rules. And although I was making money, I just wasn’t happy. Then a friend of mine introduced me to a day trader. And that’s when I started to day trade. This gentleman used to trade in the S&P pit, he was very experienced. He was laser focused and was consistently with his approach. I met with him to talk about whether it’s a good fit to go into a mentorship. During our meeting, he was constantly moving his hands. While we talked he must have looked out the window like 50 times – that’s how fidgety he was. But he is a good trader and so I signed up. But what he wanted, I found out afterward, was for his students to be watching their screens from 8 to 5 with a 30 minute lunch break. The strategies were good but they require constant scalping. The bottom line was, if I really want a 9 to 5 job, I would have stayed in the corporate world, so day trading wasn’t for me either.

And that was when I met George. George traded long term and medium term but he also day traded when he had the time. He taught me some very good skills and strategies that became the foundation of my trading. What he did for me that nobody else dared to do was to tell me straight up that I wasn’t cut out to day trade or to make longer term investments. He recognized that I didn’t have the patience. But that had to come from somebody who had a broad range of knowledge of trading, was successful, and also had the guts to tell his student what to focus on. He told me to swing trade which basically means a medium-term trading style and he told me to focus on one market first. He said to start with crude oil futures, and I did. And rather quickly, I became pretty good at trading crude. Then I added gold, then gasoline, then cocoa, then the beans, and lean hogs. He then showed me how to trade options which actually became my favorite types of trade. He was instrumental to my successes you can see. And I think, at the end of the day, having a mentor is of supreme importance no matter what you do. You must have the curiosity and the drive and the accountability but if you can find someone who is already successful, who has already achieved what you want to achieve, who is passionate about the subject matter and who is willing and eager to help, then go for it. My recommendation is to immediately apply to work with that person and ask him or her to become your mentor and I leave your audience with that today.

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