Jeff Carter has a degree in economics from University of California at Davis and began working in the brokerage industry in 1985. Jeff has been the editor of The Complete Report since 1987.

This is the final installment of my interview with long-time trader Jeff Carter.

Optionetics: How would you characterize your technical approach to the markets?

Jeff: For the overall markets I am a trend follower based on 50-day and 200-day moving averages. For individual stocks I look for support levels and also acceptable stochastic levels. I do not write puts to buy a stock that would be characterized as “overbought.”

Optionetics: What do you think are the greatest misconceptions beginning traders have about trading the markets and about trading systems?

Jeff:  In our business we deal with beginning traders all the time, and by far the greatest misconception is that they think it is too easy. They think they are going to get rich overnight following someone’s system, and when they don’t they give up. One of the best lines I’ve ever heard is, “the market doesn’t just give money away.” How true that is. You’re playing against professional traders whose job is to basically take your money from you. Trading is very hard work, takes a tremendous amount of patience and also the ability to admit when you’re wrong and move on to another trade or strategy that works better for you.

Optionetics: What kind of advice would you give a person just now beginning in trading the markets?

Jeff:  The same as any financial adviser would -- diversify, take small positions and use stop losses. Don’t be afraid to make a mistake. And don’t use money you can’t afford to lose. In the beginning you’re very likely to have many more losers than winners, you have to be able to accept that and learn from your experience.

Optionetics: Can you describe what your average trading and analysis day entails from preparation to execution?

Jeff: It’s basically reading the fundamentals of a company, entering it in my charting software and watching it every day. Then checking the prices after I take the position. I’m not a day trader so I’m not really finding things out on a daily basis.

Optionetics: What kind of decision-making process do you go through before deciding on a particular trade and a particular sector of the market that would be worthy of putting on a position?

Jeff: I just stick to what I’m interested in, low-priced stocks in the energy and alternative energy sectors. When the trading range, stochastic and option prices all make sense, I take a position.

Optionetics: What type of analysis methodology do you employ to find great trading opportunities?

Jeff:  Again, I’m not searching the entire market on a daily basis. I’m just watching a handful of stocks at any given time.

Optionetics: Thanks Jeff for sharing your thoughts about the trading business with our Optionetics reading audience.


To read previous installments of this interview, please click here.

Jeff Neal 
Senior Writer, Options Strategist & Profit Strategies Radio Show Market Correspondent
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