I highly recommend listening to the full interview. It's one of the best ones we've put out to date. Here are a few notes from the interview.
Paso's Journey to Trading Success
- Paso has been trading for about 5 years
- He came from Bosnia to United States as a refugee during childhood.
- Paso went to law school and dropped out freshman year after realizing it wasn't for him.
- He got a job at a pharmaceutical company after dropping out.
- Paso realized he made more money in stock (from stock options) than from his salary. This is how he became intrigued by the markets.
- Paso quit his job so he could pursue day trading. He thought “buy and hold” would be simple after seeing the returns on his stock options.
- Paso started trading, got lost in another chat room, and found IU a month later.
- Paso had a lot of pressure to perform, as both he and his parents were out of jobs at this time.
- Eventually, he had to get a job in sales again so he could get more capital. At this point, he switched to part-time trading.
- He still struggled to find consistency for 2 years
- Paso's first big win was 100k on a swing trade. This was the start of Paso's massive success.
- Paso began to develop consistency, but still struggled with bigger losses. He would make 2-5k/day for a few days in a row and then lose bigger money on another trade. His goal was to eliminate losses and let the wins accumulate.
- Paso has been trading full time for the past 2 years
Paso's Trading Process
Paso has a unique trading process, based primarily on simplicity. Here are some of the details.
- Paso looks for opportunities where sellers become exhausted, allowing for a trade reversal.
- He is primarily interested in stocks that gap up or down
- Paso focuses on the "big money" in a trade. He prefers to pay attention to institutional buying vs. retail.
Building Watch Lists
- After market close, Paso reviews news and financials for companies making headlines.
- Paso analyzes charts and takes notes on the stocks he's reviewing
- He will draw out support/resistance lines on a chart BEFORE entering a trade.
- Paso will limit his watch list to 2-3 stocks (1 top, 2 secondary)
- He will analyze pre-market activity the next day to finalize his game plan
Main Analysis Tools
- Paso keeps things simple!
- His main indicators are price, VWAP, and Level 2
- Paso uses the support/resistance lines guide his trading.
- Paso is focused on the bigger picture in a trade
- Level 2 is one of his main analysis tools (alongside charts)
- He will block out small orders on Level 2 so he can focus on the "big money."
- Paso will start with a smaller position (relatively speaking) and build up from there.
- He will leave room for up to 3 adds on a position (i.e. adding more shares)
The Importance of Routine and Discipline
- Paso follow the same routine every day. He is highly disciplined and treats trading like a real job.
- Paso is an early riser, starting his day at 4:30AM.
- He will go to the gym first thing in the morning (from 5-7AM)
- Paso meditates for 5-10 minutes in the morning
- Paso doesn't accept calls before 12 (unless it's an emergency) so he can stay fully focused on the markets.
- After the market closes, Paso takes some time to wind down. He enjoys spending time with family.
- Paso is in bed by 9-930PM so he can come to the market prepared the next day.
Paso's Tips for New Traders
- Always have a plan before entering a trade.
- Don't follow random alerts - it won't work.
- Don't jump in on random trades - you will get in trouble.
- Focus on a single setup that works well for you.
- Trade small and trade consistent. This is how you develop a skillset without blowing up your account.
- Trade every day and be involved. Participating in the market every day helps you understand trends, how the market is behaving, and more.
- Becoming a consistently profitable trader takes time. Stick with it. It will come together.
- Surround yourself with other successful traders. The lessons you can learn from the experience of others are invaluable.