Exclusive Interview with Mike Bellafiore of SMB Capital

“A great samurai warrior possesses the perfect blend of aggression and discipline. Too much aggression, and the warrior becomes exposed to defeat. Too much discipline, and the warrior may never attack.”

Damien Hoffman at Wall St. Cheat Sheet recently interviewed Prop Trader Mike Bellafiore, co-founder of New York City based SMB Capital, a leading proprietary trading known for selecting and producing top traders through their intense commitment to daily review and education.

Mike writes “Bella’s Blog” along with other traders at the SMB Training blog which is updated frequently to share personal observations and “teaching moments” of the day with the general trading public. Many traders including myself have found it to be a deeply resourceful site that gives you an “Insider’s Peek” at what happens day to day at an NYC Proprietary Trading Firm.

I wanted to highlight this interview for you and pull out some of the top quotes I found most intriguing from Mike:

“[Back when I started in 1998] there were no charts. Also, there was no CNBC or news feed.”

[Corey’s note:  Those who get started in the markets in 2009 have it so much easier – don’t take all the advantages we have today for granted!]

“Very clearly, [our goal is] to create the best teaching desk on the street.”

“One of the things we teach at our desk is to prepare ‘if-then’ statements for every trade you’re going to make.”

“For example, we look at consolidation plays, support plays, breakout trades, momentum trades, etc. We teach our traders to develop their own ‘if-then’ statements for each of these trades and the subsets of these trades”

“If I traded and you were to sit down next to me you would see that every single trade I make makes sense. I know why I’m in it, where I’m gonna get out if I’m wrong, where I’m gonna get out if I’m right, I can tell you exactly what type of trade it is, and the catalyst for why I got in.”

“Trading is about skill development and discipline. It’s not about developing the newest, brightest trading technique.”   [I totally agree]

“It’s very important to have a calm temperament as a trader.”

“No one should attempt to start trading unless they have a true passion for the markets.”

“You must have the ability to quickly admit mistakes.”

“[With advances in technology,] there is no reason why someone who is not in NYC, someone who does not work at a big bank, can’t become a terrific trader. That didn’t used to be the case. But now the playing field has been leveled.”

“[Big banks who used to dominate the market]  have to actually trade like we’ve had to trade for the last twelve years: with absolutely no advantage, ever. They have to watch the tape, look at charts, understand fundamental analysis intraday, and make quality risk-reward decisions.”

All of it’s great material!  For the full interview, click over to Wall Street Cheat Sheet.

Corey Rosenbloom, CMT