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Q&A with Founder, Chief Strategist of Certus Trading, Matt Choi

Matt Choi is a Toronto-based chartered market technician (CMT) with over 17 years of experience as a professional trader. He is also the founder and chief strategist of Certus Trading, a trading education company and platform that allows Choi to share his trading strategies and knowledge with his students. After earning an MBA from McMaster […]

Certus Trading’s Matt Choi
Matt Choi is seen speaking at the Money Show at the Mariott Marquis hotel in San Francisco, California on July 16, 2015. Photo by Josh Edelson

Matt Choi is a Toronto-based chartered market technician (CMT) with over 17 years of experience as a professional trader. He is also the founder and chief strategist of Certus Trading, a trading education company and platform that allows Choi to share his trading strategies and knowledge with his students.

After earning an MBA from McMaster University, Certus Trading’s Matt Choi ran a car dealership while trading on the side. He grew his business and eventually sold it for multi-7 figures so he could commit to trading full-time.

A self-taught trader, Matt Choi gained his knowledge of the markets through years of experience of trading his own money. He is now a rules-based trader who favors swing trading. You can learn more about how he found success in a book he co-authored called The Winning Way: The World’s Leading Entrepreneurs and Professionals Share How They are Winning in Life and Business and You Can Too!

How did you get into trading? What were the major milestones that got you where you are today?

Matt Choi, Certus Trading:

A lot of people have asked me in the past how I got into trading.  Looking back, the seed was planted very early-on in my childhood, specifically when I was 10 to 12 years old.

At that time my family and I we were still living in Hong Kong. That’s where I grew up, that’s where I was born, and that’s where I lived before we moved to Toronto, Canada.  The way my elementary school worked at the time was that grades 4 – 6 went to school in the morning. We started at about 8 A.M. and then we were done by noon. They also had an afternoon session for the lower grades, 1 – 3.  They had to segregate the school into two different sessions to accommodate all of the students in a very populated city.

Since I was done with school at noon and both of my parents worked full-time, my grandparents who lived in the same apartment building looked after me in the afternoon.  My grandfather was a stockbroker and investor with the Hong Kong Stock Exchange. Back in those days there was no internet so he had to physically go to the exchange to settle his trades.  When my grandmother got busy, I would ride the bus to the exchange with him. 

The bus ride took about 45 to 60 minutes, and I really enjoyed spending that time with my grandfather. He taught me about life, how to be a good person, and he told me how he survived the war. You know, all the stories that I can now share with my child.

During those bus rides, grandpa would get excited talking to me about stocks. He taught me about the stock market, how to pick great companies, and shared his general investing philosophy.

Back then, Hong Kong was a booming economy and both small businesses and large corporations were growing quickly.  Banks played a big part in financing this huge growth. In particular, grandpa had his eyes set on HSBC, and he put every penny that he could afford into that stock. Between dividends, stock splits, and exponential growth, the stock literally took off.

My grandfather did really well with his investing. Later on, he also put a lot of money into telecom when the infrastructure was first being laid out. After our family moved to Toronto, he put a lot of money into telecom giant Bell Canada, among others.  He ended up making a killing.   You can imagine how he influenced my thinking way back, and how that eventually got me into trading the markets later on in my life.

After we moved to Canada, I became a teenager and obviously trading wasn’t my priority. I was focused on school, making friends, getting into the culture, and playing sports.  It wasn’t really until my MBA years when I realized that I had a really good knack for finding good stocks. I won some stock trading competitions and it came pretty naturally to me.  That reignited my interests in the markets and had me reminisce about my good old times with grandpa.

I incorporated many of his teachings, but the markets were starting to move a lot faster back in the late ’90s and the early 2000s. I made a lot of money during the dot com boom and I also lost a lot of it when the bubble collapsed. It was a disaster. That was definitely a milestone for me because I learned the need to be faster with my trading. You can’t be buying and holding and sitting still anymore. You need to be super nimble in today’s markets.

The next milestone came when I discovered technical analysis. Right away I had a feeling that the techniques really jived because I really liked how clean-cut technical analysis can be.  I’m able to derive strategies based on rules.  For example, if a stock does A, B, and C then I know there is an 80% probability that it will do D. It’s very formulaic. And because I simply follow the rules, it helps keep my emotions in check.  When we trade with technical, we are no longer concerned about the widgets that companies sell, or whether the CEO is well-liked. It’s all about the chart and the price action. There’s no guessing and there’s no emotions involved. It is strictly based on rules. That was definitely an AH-HA moment for me and definitely another major milestone.

My next milestone would come in 2003 when I found my mentor, George Fontanills.  He taught me a ton of trading strategies, but much more importantly, he helped me discover who I am as a trader. George helped me hone in on my true personality and also helped guide me away from the pitfalls.  For example, he knew patience wasn’t my strong-suit which meant longer-term investments were not going to work for me. He also knew that I’m pretty impatient and can’t sit still, so day trading wasn’t for me either.

We kind of settled in on more of an intermediate time frame, swing trading, where I would make trades anywhere from a few days to a few months. He helped me tremendously with finding my trading self so to speak. Those two years that I spent with George were huge in shaping my success over the years. I think that was probably the biggest milestone for me.

You have run multiple successful, yet very different, businesses. What is your advice for finding success as an entrepreneur, especially when moving across industries?

Matt Choi, Certus Trading:

It doesn’t matter what industry you are in, high tech, healthcare, insurance, automobile, e-commerce, or printing, there are always opportunities to be successful. By that, I’m talking about money. I’m talking about making a profit.

However, to be financially successful in any endeavor, there are three must-have factors to abide by.  Number one is having a passion for your industry and then mastering it.  Everyone has different passions and one of mine is cars. I just love the advances in technology, and how cars have evolved over time.

As the former owner of a car dealership, I quickly realized you need passion for cars and more importantly, passion to service your customers.  You want to give them the best experience and if your customers are happy, then the money will follow. When you take care of your people, treat them with respect and help them solve their problems, then you will be rewarded.

Since I was brand new to the car business, I decided to learn everything there is about the industry. I spent time in sales, marketing and in the service department.  Customers didn’t realize I was the owner when I spent time as a service advisor.  It really opened my eyes listening to the customers’ concerns about their cars, why they were coming in, and what they needed done.  A lot of them share their stories with you, sometimes happy, sometimes sad, and they touched my heart in so many ways that I quickly realized the car business truly is about the people.

I also spent time in wholesale parts where I learned the way we stocked parts as well as the way we carried our inventory, whether it was a spark plug or a bumper. I understood what parts other garages needed, and I learned how to do inventory and make a profit from it.  When you know the needs of your customers, you can solve their problem. That’s the kind of passion for the industry that I am talking about.

Trading is very similar.  When I began trading, I took what my grandfather taught me and then I looked at all of the possibilities out there.  I learned commodity futures and financial futures.  I learned how to trade stocks, currencies, and options. I mastered all of those.

You have to really take an interest in the industry. You have to be willing to learn about its history, and how it has evolved over time.  Once you have a good understanding, you can start honing in on a few things that work best for you.  You can start by focusing on one or two asset classes. You start to expand and then eventually come back to the things that you’re most passionate about.

It’s an old cliché but once the passion is there, the money will follow.  I’ve experienced it. It works. If all you care about is the monetary reward, you won’t do well. Ask any successful entrepreneur out there. It doesn’t matter if you’re the late Steve Jobs or Elon Musk or Warren Buffet. It’s all the same.

Assuming you have a deep passion for your industry, the second component you must have is a passion for success.

When I first got into the car business I looked at what other dealerships were doing. I benchmarked the best processes, the best sales techniques, the best customer service, the best time management, and the best people management.  I knew them all.

Once you’re able to match up with the best of the best, then you can set even higher goals to beat it.

The same applies to trading.

I can spend up to 14 hours a day trading but what would that do to my health and mental well-being? What would that do to my personal relationships? Part of being successful is knowing how to spend less time doing something while still remaining efficient. I measure myself on my average success per trade. I want to make the minimum number of trades to get the maximum possible return.

I want to work less and make more. I want efficiency so that I can spend time doing other things that I love to do like charity work, volunteering, playing soccer with my child, or taking my child to swimming and hockey. You have to have a passion for success. Look at what the best of the best are doing out there. Copy it. Then turn it into something that is your own. Don’t just blindly copy it and think that you can do the same thing. You have to tailor it and modify it so that it fits your lifestyle, your personality, and your goals.

George taught me a lot of things about trading, and ultimately I was able to take what he taught me and customize it into something that is even more aligned with my lifestyle, my personality, and for my goals.

The third must-have success factor is not being afraid to fail. Thomas Edison said, “Many of life’s failures are people who did not realize how close they were to success when they gave up.”

I’ve wanted to start a business for years.  When I was working in the corporate world it was my dream to venture out on my own.  But at the time, I didn’t have the funds or I couldn’t find the right business model. Many times, I almost gave up. I thought perhaps I’d be climbing the corporate ladder and dealing with workplace politics for the rest of my life.

But I kept at it.  I keep telling myself to stick with it.  Eventually I learned from all of my mistakes and I started looking for opportunities elsewhere. My thinking became more unconventional. I no longer followed the herd. If 90% of people tell me to do A, then I’d go and do B. You’ve got to know what the herd is doing but don’t become the herd. Think like a contrarian because that’s what the most innovative and successful people always do.

It’s the same in trading. In the beginning, I lost a lot of money and I wanted to give up so many times, but I didn’t. I took the initiative and got help from George, my mentor and one of the best traders in the world. Like I mentioned earlier, you want to benchmark the best and learn from the best.  I worked even harder and put more time in to accelerate my learning. No matter what it took, I was determined to succeed. I submerged myself in trading. Eventually, the success paid off. 

You cannot be afraid to fail. In fact, I embrace failure because I know with each fall, I am one step closer to success. Look, no trader is 100% right. At best, my trades are about 70% winners so there is no choice but to accept losses and to learn from them. Remember, it is failures that lay the foundation for success.

You are a self-taught trader. Do you think that gives you an advantage over other traders and if so, how?

Matt Choi, Certus Trading:

Looking back, being a self-taught trader was a great experience with its ups and downs. I wouldn’t necessarily say it gave me an advantage because it’s really about hard work and passion. With that said, being able to figure it out by myself allowed me to fail fast and eliminate all the noise.

The problem with self-learning is that the process is slow. When I felt like I was starting to stall, I looked for help. Luckily, I found George at the time. Again, I can’t say enough about George. Unfortunately, he passed away a few years ago. He was a great mentor, but it was the whole team behind him that helped me. Tom, Nick, Christina, and Mitch – those are all great traders in their own right, and all fantastic people who supported me and helped me reach my full potential as a trader.

A good analogy is if you want to be the best swimmer, at some point, you need to go out and find the best swimming coach. If you want to be the best soccer player like Ronaldo or Messi, you would need to join the best academy, perhaps Barcelona or Real Madrid.  And if you want to become the best engineer perhaps going to MIT would be the best option.

From my own experience, being self-taught is a great starting point. There is a tremendous amount of free resources online, so take advantage of it.  However, if you want to get to that next level, I suggest finding a mentor who has already achieved what you want to accomplish. 

Even though I have always been a self-starter, one of the best decisions I’ve ever made was to find someone like George to coach me. He probably saved me a good four to five years of time when it comes to becoming a successful trader.

Can you share some of your favorite trading tips from your Certus Trading courses and your book, The Winning Way?

Matt Choi, Certus Trading:

As a trader, the one thing that is often overlooked is the need to focus on the now and being present in the moment. Don’t let the past affect your emotions and your decision making, instead focus on what is happening right now.

I think the best way for me to describe this is by using some simple analogies. If you love soccer, like I do, you probably agree that Ronaldo and Messi are two of the best players in the world today.  Now they too go through some scoring droughts, right? They don’t score three goals every game. They have gone weeks without scoring a goal. Do they quit? Absolutely not. Do they change the way they play? Absolutely not. They are 100% confident that they have the skill sets to be the best, and they just keep working hard and eventually the goals and rewards will come.

Another perfect example is Steph Curry of the Golden State Warriors. He is probably the most prolific and accurate 3-point shooter in NBA history. Yet he has gone through stretches of poor shooting. He is normally a 45% 3-point shooter but there have been stretches when he shot 25%, 30%, 35%, which is great to some players, but horrible by his standards.

So what does Steph do? He just sticks with it. He kept shooting the same way. He doesn’t go out and change the way he shoots, change the way he jumps, change the way he holds the ball. He kept doing what he does best. He keeps the technique the same and works through it by focusing on the moment. He doesn’t think about the last three shots that he missed – he visualizes the next ten shots that he will make.

As a trader, I know that my strategies will always give me an edge. Even when I have a few losing trades, I don’t allow fear or emotion to take over.  Instead, I keep executing the next play without hesitation. I don’t think about my recent three trade losing streak, but focus on winning the next ten. The one thing that you have to focus on as a trader, as an entrepreneur, as a person, is not to dwell on the past. Believing in ourselves, knowing that we can do it because we have done it time and time again gives us the confidence to seize the moment and be successful.

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