Interview with Alex Aardt Linden

Could you tell us a little about yourself?

My name is Alex Aardt-Linden and I run options-coach.com. I have been a professional trader for 18 years, trading equities and options on indices, equities, futures. I rose from an Execution Trader to Portfolio Manager at a Hedge Fund and now I work for a Family Office as a Portfolio Co-Manager. My small team’s focus is options. I also train new traders for several money management firm clients and individual traders from around the world. Currently I teach my students to take profits out of the markets using 6 highly effective strategies spread across the risk spectrum: from low to medium to high risk (and high reward.) I have my students focus on risk management, planning and executing on the set plan. My strategies take only 15 minutes to an hour to implement per period (per month, in case of monthly strategies) per instrument. Most of my students have full time jobs or businesses, so they pick 1 or 2 strategies that they like the most and apply each of them to 1-3 instruments and they do the same thing over and over every month. My strategies are very methodical, all-encompassing and are “condition-action” based: when condition 1 happens, action 1 is taken, and so forth – this gives my students the confidence in their plan and reduces the stress associated with the fear of not knowing what to do in a situation.

How did you get started trading?

I was recruited out of college to be an execution trader at a Hedge Fund.

How long have you been trading now?

18 years.

What do you like best about trading?

What greater combat is there than you against the rest of the market, where each is for himself? The psychology of masses at play are truly fascinating. Besides, I add value to my employer’s portfolio and provide liquidity to the market. I breath and dream markets and I will never “retire”, as long as my mental faculties are operational.

What markets do you trade?

Equities and options on indices, futures, equities.

What style of trading do you use?

I mostly sell options while maintaining maximum delta neutrality.

What have been the biggest influences on your development as a trader?

A “who” rather: my first risk manager, who taught me to focus on risk, discipline and planning.

What is the one biggest lesson that you have learnt since starting trading?

I learned that all trading decisions should be made before the trade: they get detailed in the plan. This way one doesn’t have to make any new decisions during the trade itself, because that’s a more stressful time and decisions made under duress can be rushed and not well thought through. You strategy can and should be reevaluated regularly and possible minor tweaks can be made, but that’s done between the trades, not right when an adjustment needs made or a stop loss taken.

How did you get interested in coaching other traders?

I reluctantly accepted the challenge of training some junior traders at my firm and quickly got hooked on the feeling of tremendous satisfaction from teaching.

Do you focus on coaching of one particular area of trading, e.g. risk management / psychology or finding trades?

There is no need to “find trades”, when using the strategies that I teach. My strategies are applied exact same way to the same instruments (of students’ choosing) every week or month, over and over again. I teach the same precepts I was taught years ago: to focus on risk management, planning and executing on the plan without hesitation.

How do you work together with your clients? E.g. phone / email / screen sharing?

Phone and screen sharing.

What sort of results do your clients get after coaching with you?

I arm my clients with a few ultra-effective, consistent and very unambiguous tools to take small bites out of the market weekly and monthly. My clients come out of the training with exact answers to the when, how, why, what and where questions.

What is the most satisfying part of coaching traders?

Seeing them taking profits out of the market consistently.

What is the biggest but most easily fixed mistake that you see traders make?

Approaching trading as a hobby. Trading is a serious business and needs to be treated as such. Plan, plan, plan, plan, plan, then execute.

Do you recommend journals or other record keeping as an important part of trading?

Unequivocally, YES.

What are the most common issues that you see in your clients that prevent them from becoming better traders?

Not following their plan. Also – being overleveraged.

What advice would you give traders who are just starting out?

STOP LOOKING FOR THE HOLY GRAIL – it doesn’t exist. STOP looking at total potential return as the only measure of success of a system or trading approach: a system that makes 50 trades per day and experiences wins on only 30% of trades (even if it is a winning system overall) may not be for you if you cannot tolerate 20 consecutive losses and you hold a full-time job. I just saw an advertisement in a prominent magazine for an options system that generated 5% of profit per day. So fully compounded, this system will turn your $10K into $2 billion (with a “b”!) Really?? Please use your common sense! A retail trader attempting to grow his/her limited capital should ask herself several questions: do I have risk capital? Can I handle the trading approach psychologically (can I handle the drawdowns, the stress of execution and management of my positions?) Am I able to dedicate the time required?

What 3 books do you recommend traders read?

1. The Bible of Options Strategies by Guy Cohen
2. The Daily Trading Coach: 101 Lessons for Becoming Your Own Trading Psychologist by Brett N. Steenbarger
3. Trading in the Zone by Mark Douglas

Any other advice or wisdom from your experience in trading that you could share?

Active market participation is a serious business – treat it as such: create a portfolio plan which includes a separate plan for each strategy/instrument combination, with risk management being the underlying theme of every aspect of your plan.