Hey everyone Lee Train with Stocks trade Tim Bone Welcome back to the channel got Rob Booker here again nice to see me Rob So uh, so many of you know I don't do it a ton on YouTube But if you follow me on social media, you know that I like to have a good time. You'll kind of antagonizing what we call front side short sellers. Okay, especially when we're talking these big moving stocks of the day. you've seen my beams I'm double decent at memes I'm not great but I post a lot of memes I like to pick on these people now.

One thing I will say is I was a short seller for about 10 years and I recognized a market shift in 2015. but I've talked about that a million times. But what I want to talk about is the fact that I believe that short selling is one of the best strategies out there. especially when you're talking about these crappy penny stocks that all Spike and fail.

So contrary to the memes, contrary to the sarcasm I want to bring in Rob and talk about how to short sell the right way. Okay so man, I I love this. Beat that out or whatever and we said we're gonna do a completely off the cup unpractice. There's no, there's nothing for sale here.

Nobody's got any. We're going to have just an honest conversation about short selling because we've both got two sides of these opinions. and I'm gonna kick this off and I'm gonna I'm gonna like agree with you I have watched Traders short low float high volume stocks and get their butt kicked. Sure and hold on to those and you know as they say, the the loss is infinite.

Yes, okay, he's like I haven't ever seen a stock go to Infinity but I have seen a stock go to zero. So and I've seen people have their account I've seen people actually owe their Brokers money right because they're trading at Leverage. So with that said, you know that's a that's a fair warning and I like agree with that and then at the same time and we're friends here. So I'm gonna let you know when I see those memes I want to jump out of my skin.

So I trade um I trade every day. Um, it's not a service. It's not a thing. It's not a class.

It's nothing. It's me and about 30 friends Diego and Tom and uh and and Caleb and all we do is short like I don't buy stocks anymore and my thing was I kept I Love the way you train I love your V-wop holds I love all of it. But what I found is I was getting into these and they would spike and if I had to walk away and take a break, those mother things would drop back low volatility Halt and then drop like a stone. When you and your crew are done buying those stocks, those stocks in a lot of cases will crater and I Just said this is like a it's like a just all of the sudden Had this realization after it was about after 21 years of trading.

I said I need to switch directions and so I started Short Selling and I Got to tell you man, if if all of you out there want to buy them on the way up with him and short him on the way down, that's the way to go. That's ultimate. Your memes aside that that's the way. Like and and listen, be agnostic, recognize price action.

Yeah, like um, let's take like even low float high volume stocks. uh Cxai Yep goes from two dollars one day to 69 overnight and then 24 hours and then it crashes completely and so a don't short that stock. Hey like part A don't short that stock. Let it have its day.

Every dog has its day. B You know how you do the V-wap hold and it holds above the V-wap Just look on everything. Your volume of stocks to trade stuff is amazing. It's the opposite.

same pattern. say I came back down. we hammered the fudge out of that and Edtx and Prfx and all of these companies that have these. they Halt and if a stock once again, I can't I get so excited about it? This makes me so excited.

Um, when they halt, those are even the more dangerous stocks to short while they're halting because a halt is basically an advertisement to buy this stuff. And then when that thing is done, halting for the day, that piece of garbage, Whatever company. So I Imagine a bunch of Executives sitting around. They got a low float company and they're like, hey guys, um, how's the product We talk about playing in the game.

Yeah, right. That's when. I Yeah and those companies actually like? Well, you know the products aren't very good. How are customers doing well? they're not very happy.

Well, um, how's their stock price? Not very good? I Got an idea. Let's put a press release. Yep. and what happened in a hot sector? In a hot sector? Or they're not.

even. They make toilets and they go. but it's an AI enhanced toilet. Yeah.

and the next thing you know, this company from nowhere spikes and you gave everybody the tools. You're the first person. I Remember going to see you at a conference and remember you opened my eyes. You opened my eyes to this.

Find the right stock, get in and get Gtf. Now that works. But it's the other half of that. So they put out this press release like give me a common scenario.

They put out a press release and they say we've We've now in. We've now enhanced our toilets with artificial intelligence or whatever they say and then it just pops. Yep, and it halts. And I mean we're cool though.

Like right? It then drops, right. It just goes back. usually right to where it goes. What would it take for a stock like that to keep going? Well I mean the biggest thing is that to keep them alive is to have actually like some real like future for these companies.

Okay, like like and that's I think the biggest Revelation that people I think this is that whole long short idea that people trip up. It's like listen, I don't believe in any of these stocks you've heard me talk about. I've heard the life cycle. The penny stock life cycle.

The penny stock life cycle is a perfect pyramid. Okay, it goes straight up and it goes all the way back to where it was. Now that may be one day, that maybe three days, it may be three months. The ones that stay up and hang around are the ones that continue to play the game and put out press releases constantly and hype themselves up.

But the simple fact is that 99 of these are incompetent. They're creating a move to create what we call a liquidity event. Okay, they drop that AI enhanced toilet. It brings in 100x volume and all the Cokehead uh CEOs and Executives and insiders are like hey buddy, They tell everybody that their friends were dropping a PR or start selling.

Yeah, and we've got our dilution. We've got our and we got our registration. Yeah and what that means is and I hate to be. We're kind of crass about this, but I Want to give you some credit here I've heard you say a trillion times.

I Don't want to hear that anybody held the stock overnight. Yep. I Don't want to hear that if this goes into a loss. I Don't want to hear that you're back holding.

Yeah, you're equally critical of backholders on either side. So here's what happens. so these company Executives They have everything ahead of time I Know this sounds crass and I'm not mentioning any company specifically alleged allegedly. So they have these registration filings ready to go where they could issue more shares.

So if you and I start a company and we kick it off and it's got 300 000 shares on the float, there's only 300 000 shares available for trading and on a day we issue our press release about our smart toilet and it's got wheels I Don't know and we're so excited about it. The stock goes from 67 cents to 3.67 and it's just zooming 4.67 and it halts. Why does it halt? Oh Jolie Volatility So there's no rules. Literally shut the stock down.

and then they announced that they halted it which then it gets out on Twitter and everybody takes it. Now it's at ten dollars a share and this has happened. Oh yeah, Twenty dollars a share. Thirty dollars a share and now we're all sitting around.

We go. Let's take that, SEC filing registration and let's issue a million more shares to the public at Thirty dollars. Yep, we're gonna raise 30 million dollars. You know what? You get? A bonus.

You get a bonus like Oprah Walking around the house and all of a sudden they just tripled the number of shares outstanding and the stock price drops by 30 percent and then fades for days and days and days afterwards afterwards. Because now there is no more Two things. There's no more press releases because they made their money. Yeah, now there's fading volume and there's no more hype and everyone knows they diluted.

So it's like, well, everyone. Once you understand this life cycle, you know it's all over. So can I ask you like can I Lightning round you? sure? All right. So people say that shorting stocks is dangerous.

100 Yeah, Okay, right and all. Ultra Ultra Listen to anything anything like like I've often talked about. like when people talk about the high failure rate of trading I Mean look at, look at the high failure rate of starting a business. Okay, but good luck getting truly wealthy without either trading or starting a business.

Okay, there's a lot of risk, but okay, the rewards are there. So what would a what would a, uh what would a stock Trader Who's going to do it the wrong way? How would they go about losing money as a short seller? Well, the biggest thing you would do is I think in my opinion would be shorting at or around the market open. Okay, because that is your Peak Apex of of mania. Okay, like if you're shortened I don't care what it is if you're shorting anything right at the market open man.

Now listen, a lot of stocks collapse at the open. but think of that, you know the reason the bell ringing and every I mean especially like Monday mornings I mean everyone wants in I think that's one of the biggest things. Yeah, that's gonna screw you up. So it's funny.

You say that because because the same stock at 9 30 is completely different at 2 30.. if I'm short of stock at the open I was already short before the open. Yep. and then you ride it into the open and then it really gets bad.

But then otherwise you're right. Let it go up all day long. let it even go up if it closes near the high of the day. Don't touch it.

Have you ever seen a stock like drop after hours too? Oh God yeah again. I mean a significant majority of the offerings are after hours? Yeah, now. like. but but see what's great? Like and listen I was a short seller for 10 years, but like when you let that morning Rush What? I love about that first initial move.

Typically these stocks the biggest candle is going to be the first candle of the day. Yeah, and what's great about that is it gives you an area to risk off of because when we talk about that V-wap hold pattern, my number one afternoon long pattern The View app fail is the same pattern and what's great about these big Runners is you have a great spot to risk off of because listen if this stock goes from one to three trickles, lowers trickles, lower breaks V app at 250. yep you enter it there and it goes to like 225 and if it goes back to three and you're still short, well you deserve all the pain and despair and poverty and homelessness you and drug addiction and and and pain. And and you'll right because that years when I was at Short seller like I knew like if this thing's headed towards High a day I'm sitting there and I'm like well you're doing this to yourself man you're you're choosing to stay in this stock right now that is no longer a short.

Yeah so that especially I think is contrary as it sounds if you struggle with discipline it's a great way to be disciplined because man if you stay after that height it's gonna get ugly. it's gonna get bad. So I think I mean if I might be so bold as to say when I turn to shorting stocks almost exclusively I became better at buying stocks every once 100 and because you came from a background of shorting stocks, you're better at buying stocks 100 I think it's wild I think it does make you when you could see it from the other perspective, it makes you better at either side 100 like like I used to that first decade of my trading career I just it. just like it didn't even like compute to go long like I just couldn't understand it.

like it like like like I'm like people are buying penny stocks I don't understand it so I think that is so important no matter what your strategy is to understand both sides of that trade I'm gonna I'm gonna be self-deprecating for a minute because I love the way you trade. The only way I buy stocks when I buy them is like you and so what I'll do now every once in a while is I'll see your morning you know, stock of the day, pre-market prep and for whatever reason I'm just so bad at executing on it I know the method I know it works and and so what I just did is I stopped worrying about whether I was bad at it I just stopped doing it right and I appreciate it and I watch it and I get so jealous I get so jealous like man, all these people making money but I just have to wait it out and so I just wait to play my game. Yep so I just kind of play the game that I'm good at and I think either way, we slice it. Um, we really should just be doing this.

We should just actually be doing this every day. Fair enough. Now what do you think? Like like you know, my question with you is Okay So we've we're people are probably very interested now. Okay, now there's a lot of roadblocks to shorty boroughs.

Yeah, proper. Brokers Etc Like that. Yeah, so like okay, Joe or Jane out there wants it short of stock tomorrow? how do I get started? Like so there is a permission? Okay, you aside, that's it. You're the only exception.

There is a pernicious. and I think via I'm not even joking around. It makes me mad. There's the vile pernicious, disgusting.

Whatever it is. people who lost money shorting stocks or who are jealous of the millionaires who short stocks. If you look at the the the biggest millionaires that learned how to trade from Tim Sykes Tim Grittani and Jack Keller combined for 30 million dollars in profits. They're short sellers, so there is a pernicious rumor of people who are jealous of sometimes people who are successful and they spread it that it's dangerous and then they follow it up with that.

It's difficult. Here's how to short a stock. Instead of buying it, you borrow it, you short it, you wait for it to drop, and you close. You simply press the sell button before the buy button.

You don't need any special permissions from your broker or your mom. or Tim Bowen you don't need any special permissions. You don't need a certain account size. They don't care about the pattern Day trader rule.

you just take one or two trades a week and honestly, that's what I do I Now am over the pattern Day Trader rule. I Target 500 700 000 a day I'm not I'm I'm not trying to make even a million dollars a year, but that number for me being consistent and repeatable is it's just it changed my life as a Trader it just changed my life. So yeah, I'll just I'll let I'll give a guide don't It's not necessarily more difficult than anything else because I I you know in the one the pay where. We totally totally agree that I think that you know one of the things that that you know and I know I've said it several times, but that 10 years of 95 Short Selling and not being unders able to understand how to go long.

What happened was that 2015 period was a year of a lot of Epic short squeezes and I got stuck in a lot of them. Okay, a lot of them, a lot of pain and suffering. Okay, and that was like I'm like well wait a minute. Okay, it's kind of the same recipe here.

It's this. it's this big. you know, this low float stock that's a big Gainer But the difference is this guy's been consolidating at The highs and I'm not stopping out and it's ripping to the upside. So if I learned to recognize that on the long side and vice versa, it's the exact same pattern that big Gainer that can't get above vlap and Fades late day and it's like okay, we know the signs, we know how to recognize this and it creates.

In my opinion, those afternoon trades are the highest probability setups for anybody. dude. man, if we could, if if we got like this, never gonna happen. but if we got in the same room every day and you you guided me through the process of watching those go up I would be 10 times better at shorting the stocks on the way back down.

I Just love this. I Love this conversation. I Know we've gone on for a long time, but I Love the member I Love the subscribers to this channel I Love the people that you work with I Love the way that you approach this subject I Love the fact that you're agnostic about if you can make money doing something, go do it. But the most important thing you say to everybody is don't hold on to your losing trades.

Yes, just don't hold on. That's it. I mean that's where and kind of wrapping it up. That's where Again, the memes and the stuff that's mocking like listen, if you're short something and you're down, you know, 30, 40, 50 and you're holding it I'm sorry you're gonna get meme to death.

Okay, because you deserve to get Beat to Death right? What? I Like is your memes come out while the stock is rising. My memes come out when it's falling, it's like somebody's the someone's By the time that I'm ready to short it, you're You guys are so long gone it's always so out of that stock already. So and uh, thanks again Rob Hey man, thanks so much Foreign.