Navigating the Stock Market: Insights from Trader Zero

I began my stock trading journey in late 2019 using an app that offered a clean, simple way to observe and invest in stocks. In 2021, I discovered a more comprehensive stock trading app that provides a plethora of details and tools, which I continue to use today. Along the way, I’ve gained valuable insights into trading, yet I have much more to learn.

I’ve observed people discussing stocks online and witnessed attempts by some to manipulate others for their own gain. I’ve seen the rise and fall of the popular GME, AMC, etc. meme-stocks and others that seem to emulate a ‘squeeze.’ After watching a recent stock fall, as I usually do, I explored to see what people were saying about it, and I came across a trader who stood out for his no-nonsense approach. I noticed he openly called out individuals for dishing out poor advice to others, and he instead tried to teach people, empowering retail traders, about great resources to use instead of blindly following others who put out false claims and misinformation. I decided to interview him so he could share his experience, strategies, and resources. He operates under the name of Trader Zero (https://twitter.com/_TraderZero_/) on the social network platform X (previously known as Twitter). So here goes:

Wendy Shepherd: Thank you for agreeing to do this interview. I felt you had a lot of information to offer, so I wanted to allow you to share your experiences here. First of all, how long have you been a stock trader? How did you get started, and who influenced you to start?

TraderZero: Thank you for inviting me for an interview! I started trading in 2005. I just started a new S-CORP and was setting up a Safe Harbor 401(k) for the company. My broker and I were talking about investment options for myself and the Board of Directors when we drifted into day trading. I had been interested in starting an ETRADE account after they started their funny ad campaigns for their online trading platform. Shortly after that meeting, I upgraded my internet to DSL, put $10K in an ETRADE account, and started clicking around the platform. I watched Maria Bartiromo in the mornings on CNBC and talked about stocks with guys at the golf course. I started buying and selling everything that I heard or read was the next big thing. I didn’t even try to learn; I just bought, held, and sold for a loss. By the middle of 2005, I had lost $7K, and the buzz picked up again about Howard Stern moving to Sirius. At the same time, my dad told me that Plug Power was going to make everyone rich. The gambler that I am decided to drop another $10K into the ETRADE account and put $6K into SIRI and $6K into PLUG and lost most of my second stake pretty quickly. That pissed me off, and I was determined to get that money back. I paused trading and bought books. I read everything I could get my hands on, and after about six months, I started to actually trade and win.

W.S.: Do you prefer to buy stocks, buy puts/calls, or short a stock most often? Or do you mix things up depending on the stock?

TZ: I prefer to trade common stock as opposed to options, although I do trade both. Options trading tends to feed my inner gambler, so I had to implement a hard rule on options trading. I have lost a lot of money trading options. I am a long-biased swing trader and a short-biased day trader. That strategy has proven to result in the most gains.

W.S.: Do you trade pre-market, during the open market, and after hours? What is your favorite time of day to trade? At market open?

TZ: As a rule, I will not trade pre-market or after-hours. I spend pre-market vetting new tickers from my watchlist to trade and tending to any open swing trades. I will wait 30 to 45 minutes after the opening bell to make my first trade. I trade until my daily goal is met, and then I stop. I will go back and analyze and journal every trade I made that day. I monitor after hours and pay attention during the last 30 minutes, looking for continuation trades to add to my daily watchlist.

W.S.: There are so many terms thrown around in comment sections and in groups of traders… one being “Stick to your trading plan,”.. but I find that trading plans change often in this volatile economy. What is your suggestion about trading plans?

TZ: A trading plan is an important part of your overarching trading process and objective. You need to determine what kind of trader you are, what you expect to achieve, and when you want to achieve it. You need to establish rules and boundaries based on your trading experience and risk tolerance. Once that framework is in place, a good trading plan for each trade that is in line with your objectives can be developed. If you do this properly, the volatility or market conditions you mentioned are planned for. There is no need to change or adjust anything major. Minor tweaks to the plan are made in real time in response to the volume and price action, news releases, etc.

W.S.: There are so many more retail traders these days due to the accessibility of trading apps with small trading fees… what advice do you have for a new trader?

TZ: Generally, I think all new retail traders should take advantage of the educational resources offered by your broker and paper trade for at least three months. While doing this, write down in a journal every single thought you have in your head and everything you feel emotionally. Summarize what you learned and what you need to work on or change at the end of the journal entry, and repeat that for the rest of your trading journey. If you go on social media, do not believe what anyone says. Research everything and ask trusted people questions. Call your broker if you have questions. Do not trade penny stocks. Establish good trading rules. Join a free trading community that you feel you can trust. I could go on forever, but this would be my general advice.

W.S.: I’ve learned about some great trading resources from you. Can you share with everyone about the trading resources that you suggest, how they have benefited you, and where to find them?

TZ: There are several good sources of information that can guide you to successful trading.

I would suggest watching the team at DTTW in the morning. https://www.daytradetheworld.com/ They live trade the morning session, and the presentation is top-notch. Very informative and insightful.

The Encyclopedia of Candlestick Charts 1st Edition by Thomas Bulkowski is a must-have reference guide for trading. Don’t waste time on chart pattern TA; spend maximum time on learning candlesticks and their patterns. https://www.amazon.com/Encyclopedia-Candlestick-Charts-Thomas-Bulkowski/dp/0470182016

Fidelity Brokerage educational resources. In my opinion, Fidelity is the best platform for a new trader. Tons of info and support for traders of all experience levels. https://www.fidelity.com/learning-center/overview

There are a bunch of websites that have great information:

https://dilutiontracker.com/ – Tracks offerings in real time.

https://www.sec.gov/edgar/search-and-access – SEC database of company filings

https://www.investing.com/ – is a great site for fundamental due diligence.

All of these resources helped me be a better trader.

W.S.: It’s so easy to get caught up in the latest popular stock to trade, especially after the ‘meme stock squeeze’ that gained attention in the news. Many benefited, and many lost money. What is your advice about these types of stocks? I’ve seen you mention that some people get caught up with “group think” instead of doing their own research (DD = due diligence) and determining risks for themselves. What advice can you give about this?

TZ: My advice is to stay away from these until you have the experience to trade them. Cognitive bias is the worst enemy of a trader, and trading social media sites are breeding grounds for bias. These places are ripe with scammers and fools. Uneducated traders with little experience get slaughtered every day. You have to be to a point where you can’t be influenced by what anyone says to trade these hype tickers. Groupthink is rampant, and it’s easy to get caught up in the nonsense and lose a lot of money.

W.S.: In regards to “group think” and how people think about the manipulation of stocks, what have you learned that can help others?

TZ: I learned to focus only on the chart and the ticker symbol and use what other people say online as sentiment only. If you are properly trading volume and price action for short-term profit, nothing about the company matters. Manipulation in 2023 is subtle and not prolific. With penny stock or OTC tickers, there tends to be more manipulation due to less regulatory oversight. Stick to the mechanics and execution of trading as a process, and none of the noise matters.

W.S.: You’ve been more active on social media and called out people who seem to try to manipulate others to benefit themselves. Why did you begin doing that, and have you been able to teach those you’ve called out to be better traders? *Have you revealed your own name- to help people trust you?

TZ: When I became active on social media, there wasn’t a lot of interaction around specific companies and short squeezes. We primarily called out stock tickers with a thesis and debated trades. After the GameStop and AMC short squeezes, things changed. A cottage industry of “pay to subscribe” trading groups developed. These groups touted big gains and education and were all just schemes to sell subscriptions. I was recruited to be an analyst for a Discord-based group and got to see behind the curtain. After a few months, I saw that these were built to get subs and nothing more, so I quit. At that moment, @_TraderZero_ on Twitter, and now X” became laser-focused on supporting retail traders with free content and open DMs. I also decided to bring the heat to anyone pumping stock and spreading bad information. I have many followers that I once argued with in very heated exchanges, are now great traders and contributing followers to the #TeamTZ trading group. I have demonstrated my integrity and honesty for at least three years. I have only revealed my real name to a few people I have become close to in my efforts to help retail and shame pumpers. I go very hard at the charlatans, and if I revealed personal info, my name for sure, I would be open to threats. So far, TZ is who I am, and it works.

W.S.: How do you feel about penny stocks versus high-value stocks? Do you avoid penny stocks, and what about those stocks in between?

TZ: Your objectives, experience, and trading style really dictate what sandbox you play in. I personally trade everything if the setup is there. If the reward is worth the risk and it checks my boxes, I’ll trade it. As an investor, all my money is in blue chips, long-term, rock-solid investment-grade companies. It’s important to understand the risks of trading penny stocks, and the SEC, your broker, and many other sites have detailed explanations of the risks involved.

W.S.: A little more human interaction; I’ve seen photos of your dog; tell me more about it.

TZ: His name is Jack, and he is a purebred AKC Sable German Shepard. He is five years old and one of the most chill dogs you will ever come across. I had issues with the emotional attachment to dogs due to their life span and the pain felt when they passed away. The first loss of a family pet came when I was about ten years old, and it was very traumatic for me. I vowed never to attach to another dog again, and I didn’t until Jack came along. Jack was just a great dog from the day he was born; he took an interest in me, and the next thing you know, he goes everywhere with me, keeps me company, and is an all-around good friend.

W.S.: Unsure if you want to talk about this, but you mentioned privately to me that you acted in Hollywood from 2nd to 4th grade in plays, dinner theater, and commercials. What was your favorite experience, and why did you choose the career you ultimately ended up doing?

TZ: I am the second son of four brothers. My older brother is three years older than I am, and when my mom was teaching him to read and write at five years old, I was right there at two years old. He and my mom taught me how to read at a very young age. I later learned that I have a near photographic memory that runs in my family genetics. I was an extremely animated kid, and school was very easy for me, so I spent a lot of time with the drama teacher who also taught the advanced classes for kids who qualified for her programs. She started to cast me in school plays at my elementary school and at the local high school when they had a young age part to fill. She took me to the dinner theatre, where she directed the plays, and I started to perform there almost every weekend. We lived in California. I enjoyed it, and my parents loved it, so when she asked them if she could take me to some auditions for TV commercials, they agreed. I landed a couple of commercials, and things were looking promising for future opportunities when my dad was informed he had to transfer to another location for work. The drama teacher wanted to keep me with her to continue, and my parents asked me what I wanted to do. I chose to move with my family. I continued to act in school plays and did some radio DJ work for the school radio station, but I didn’t look for professional opportunities after that. It was a great experience and made me a great communicator. I eventually chose business as my career simply because I was recruited to that career field at an early stage of adulthood.

W.S.: Share your words of encouragement for others who may need it at this time in this bad economy.
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TZ: All I can say is to live within your means, keep debt low, and continue to invest money in long-term blue-chip investments. It doesn’t matter how old you are or how much money you have; meet with your broker and invest. Stay connected to your family; don’t let stress bleed over into your closest relationships. The economy will ebb and flow, and short-term pressures will come and go. Have a plan and stick to it. You will be fine if you manage your financial situation responsibly.

W.S.: And finally, what have you been up to lately? And where can people find you online?

TZ: Well, I recently started a business called InvestorIgnite, LLC, and our mission is to advocate for the retail trader. We just completed a stock promotion designed to give retail investors and transformational companies trading in the dollar to five dollar per share range an opportunity to connect. This was an effort of mine to show retail that low-cost-of-entry stocks could be honestly represented rather than pumped for profit by scammers. I started a free trading community on X that now has almost 400 members, where we share ideas, and I coach the group. All things “TZ” can be found on my X page under the handle @_TraderZero_, and my website, www.InvestorIgnite.com, is close to being completed. You can register for updates there.

W.S.: Thank you so much! Wishing you the best on your trading journey.