3 Success Tips from a Self-taught Trader Who Retired at Age 27

Spencer Li, professional trader and founder of Synapse Trading.
While most were still trying to carve a career at age 27, self-taught trader Spencer Li was already living the life – Having made his first pot of gold from trading, he retired and travelled to 46 countries around the world, while trading 15 minutes a day. The team from media network Affiliate Hall caught up with him to weasel the secrets of his trading success.

July 13, 2016, Singapore – Seated in the corner of a quaint cafe, Spencer seemed like the typical average Joe having his meal amidst the lunch hour crowd. Except for one small difference. Decked in jeans and sneakers, he was hard at work making some trades on his mobile phone. He flashed a smile and extended a warm handshake upon seeing the team from Affiliate Hall.

“I guess I’m done working for the day,” he said half-jokingly.

A self-professed down-to-Earth minimalist, there was no air of pomposity about him, or anything that one would associate with someone who has achieved such success so soon. Beneath his casual exterior, however, lies a unique story that few would have heard. A story that few outside his industry would have known.

Spencer, who will be hitting 30 in a few days, is the founder of Synapse Trading, a platform that provides financial education to aspiring traders. Having started his trading journey at a tender age by reading over 200 books, he went on to trade for professional funds, finally trading his own accounts and achieving financial freedom at 27.

At 28, he was invited to provide training for the Singapore Exchange (SGX), making him the youngest accredited SGX trainer in history. One year later, he was selected to share his success story to thousands of people from all over the world at the National Achievers Congress. His free financial education platform, till date, has provided insights to over a million people worldwide.

“Thanks for meeting up with us. We understand that you have been a professional trader and coach for over 10 years, and you have had some outstanding accomplishments. Can you share with us, what is the secret to your trading success?”

Pic: Spencer at the 2015 National Achievers Congress in Singapore. 

Understanding oneself

Taking a swig of his drink, Spencer paused to gather his thoughts. “If we look at the collective participation in the markets, we find many different kinds of people; different kinds of beliefs, and different kinds of theories. These differences create price movements and patterns. To understand and exploit these opportunities, I think we first need to understand ourselves.”

“Only then will we be able to choose the kind of strategy best suited to our personality, and at the same time avoid behavioural biases by being aware of them.”

A unique behavioral approach to trading — this could be what sets him apart from traders who focus too much on strategies and methodologies, while neglecting the psychological aspect.

Learn from the cheetah

“Can you share more about your own beliefs, with regards to your trading strategies?”

“Have you heard of the cheetah?” Spencer paused while we nodded. “Well, that’s my philosophy of trading.”

“The cheetah, being the fastest animal on the African plain, can outrun any of the prey it feasts upon, yet it always chooses to go for the young, weak, or sick. Once identified, it attacks with laser-guided focus and effectiveness. It is only then that the kill is likely. This is the epitome of a professional trader. Be the cheetah,” he explained.

“As a cheetah, we should always go for the easy trades. But quite often, for new traders, the easy trades are staring them right in the face but they do not see them. This is because they are only familiar with a few simple setups, with simple rules or formulas, that work best only under specific market conditions.

Traders who learn one or two simple setups think that they can trade successfully, but when the market changes, quite often the simple setup or system that they are using cannot adapt to the market, and becomes discarded.

Hence, a good trader cannot keep relying on the one same setup. Rather, he needs to know the basic form of a setup, so that from there, he can create a wide variety of different setups that are best suited to the current market situation. That is why I teach a variety of setups, and certain proven variations, leaving them the core skills to tweak setups to adapt to any market situation.”

Pic: Spencer at Invest Fair 2016 in KL, Malaysia.

Have your war chest prepared

“Do you have any practical tips for those wanting to achieve early financial freedom?”

“My approach to financial freedom is very simple, the underlying idea is to create passive income. You can get passive income from investing in hard assets like stocks, REITs, ETFs, real estate, bonds, etc, so I keep the bulk of my money in a diversified portfolio of such assets. The market always moves in cycles, so the key thing is to buy the right asset class at the right time to maximise the potential returns.”

“Hence, I think a crucial factor is having your reserves ready when that happens,” he added.

“If the market crashes tomorrow, do you have the capital to take advantage of the opportunity? If your answer is no, then what is the fastest way to build up more capital?

The common wisdom is to work hard and save, and while it is a safe option, it will take you about 5-10 years before you have sufficient funds to do any real investing, and by that time you would have missed any good opportunities during those years.”

Savouring his last sip of coffee before he continued, “My suggestion, which is also what I did for myself, is to allocate a small percentage of your capital to start a small trading account, which will allow you to generate additional returns, hence providing a consistent cashflow to help you grow your passive income portfolio faster.”

“But it won’t be an overnight process,” he warned. “It took me 15 minutes a day for 7 years before I made enough to retire, but I started with very, very little.”

“I’m sure you guys can do better,” he said with a chuckle.

Spencer Li and Synapse Trading

Synapse Trading started off as a blog by Spencer in 2008 as a platform to help new traders and investors navigate the financial markets. It soon gained a large following, and was incorporated in 2013 to provide full training courses and live coaching programs. To date, the company has provided financial education to over a million people worldwide through its articles, videos and seminars. Its vision is to help everyone achieve massive wealth, success and freedom through the financial markets, by providing quality education and support to traders and investors from all walks of life. 

To find out more about Spencer Li and Synapse Trading, visit http://www.synapsetrading.com/.

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Country: Singapore
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