Penny stocks – it’s one of those investments that either gets you very excited or gets your blood boiling. For some, it has been a lucrative trading choice. For others, it’s an area that should be avoided at all costs.
Well, today I’m really excited to have on a very well known millionaire today, and he made his first million trading penny stocks. His name is Timothy Sykes, and he’s only 28 years old. He has since parlayed his knowledge and experience into a trading academy at TimothySykes.com, where he teaches others to trade penny stocks as well. And his number one goal – help make other millionaires as well.
Remember, the purpose if our millionaire series is to show what’s possible. You don’t have to trade penny stocks, but you do need to take risks. Whether you agree or disagree with Tim, I encourage you to share your thoughts below.
Alright, let’s get started…
1. Tim, most people know you as the Penny Stock guy, but tell us about yourself?
I turned $12,415 into $1.65 million in 4 years trading penny stocks and have now refined the trading strategy so I’m up close to $4 million, but I’m far busier these days teaching and now my top student has turned $1,500 into $1.7 million in 3 years. (The story has gone viral on CNN and FOX)
I am entirely self-taught so my goal is to be the mentor to people that I never had. Now I have thousands of students in over 70 countries. I still trade actively — I’m already up 90% in the first 2.5 months of 2014 – but I’m working my butt off trying to create my 3rd millionaire student.
2. You started trading in high school – how did you manage that since school is pretty much during market hours?
I skipped a ton of classes during high school to focus on trading – I don’t recommend that.
But at the time (1999-2000), the market was going ballistic so I prioritized and I chose wisely.
3. Time management – I think most people fail at trading because they don’t put the time in the research – how do you find the time?
I actually don’t research as much as I used to. Now, I’ve narrowed down my process to a few key indicators and then just look for the same patterns that have made my students and I so wealthy. We’ve put those indicators into our newest project, StockToTrade.com, a truly impressive piece of trading software.
4. What was the biggest risk you ever took? Do you regret it?
I’ve bet big many times over my career and I never regret it if it’s the right pattern. A few times I’ve taken too big of a position under non-ideal circumstances such as when I had a fever. No matter that the pattern was right and I turned out to be right, I lost $40,000 in a day because my head wasn’t in the game and I didn’t calculate the risks properly.
My advice: Don’t trade when your mindset isn’t right.
5. What about a failure – tell us about a time you failed at something.
I didn’t always know my trading rules were to be respected so much — when my hedge fund was only growing at 20%/year and I wanted more, I turned to investing and promptly lost 35% of my fund and all of the credibility I had built at the time. The loss made me a wiser, more conservative trader and now teacher. I have to accept making high six figures and low seven figures year in year out instead of trying to go for eight figures/year given the limits of penny stocks. It’s a tough limit, but making a few million/year is good enough for me now 🙂
6. If you could make one change, what would it be?
I would change the UN’s stance on human cloning — I could achieve so much more as a teacher if I was allowed to clone myself and create more video lessons, webinars, writings to help my students learn quicker.
7. When you made your first million, do you think it changed you?
Yes, your first million changes you. You become confident and you learn that you have a talent that, if refined, can lead to many more millions. Unless you get that first million by luck, (which doesn’t count), my millions have always been made by one trade, usually a $2,000-$5,000 profit at a time, year after year focusing on the same patterns. It’s amazing more people don’t trade these, but there’s a ton of hate and ignorance out there regarding penny stocks, so I shouldn’t be surprised.
8. You’ve lately transitioned into more teacher/entrepreneur than trader – what lessons have entrepreneurship and online training taught you?
When I first began teaching, I didn’t quite understand how best to convey my lessons and I made a ton of mistakes. Over time I’ve learned that people learn in different ways, some students prefer video lessons, some like seeing live trades, others want to memorize patterns outlined in my book. To be the best teacher I have to have a full arsenal of tools at my disposal, so I’ve gotten fat again working 16-hour days, 7 days/week creating everything.
Because some of the best tools didn’t exist, we literally had to create them — like real-time trading alerts via email, text, Twitter and in chat — so being an ambitious teacher makes it even tougher, but I love it so it’s all in the pursuit of my creating more millionaire students…right now I’m at 2, but getting close to a 3rd and a 4th.
9. You’ve admitted to skipping classes in college to trade. Do you think college is necessary these days, or are their other skills young adults really need to learn?
College is good for connections and social lessons, but I could care less about both of those.
My experience has shown me that all anyone needs these days is the Internet and you can build a successful business from scratch. But that’s also why most successful Internet entrepreneurs are the weirdest people you’ll ever meet, so there’s a balance somewhere.
10. What advice do you have for young adults when it comes to money and entrepreneurship?
It’s okay to want to be rich. Society tells you you’re being greedy, but society is full of BS-ers. Go build a great product or figure out a solution to some problems and get rich, you’ll live a healthier, happier life and be able to take care of your loved ones too, which is a great feeling. Don’t do anything solely for the money, but understand that if you do a job well done, work your butt off and achieve your goals, there will be plenty of money waiting for you.
11. Anything else?
Don’t feel you need to stick to one trading or investment strategy, finance is a big, big world.
Just because the majority hate on a niche like penny stocks, if you find something that works for you and your personality, go for it! And, let the haters be jealous of your success and your Instagram account 🙂
My Thoughts on Tim’s Story
I love Tim’s story! Whether or not you trade penny stocks (and I don’t), I think that his insights and strategies are key. First, I love his hustle. He freely admits that he didn’t go to class to trade, but it was a risk that he was conscious of. Second, he’s not afraid to admit that he’s made mistakes. In fact, his foray into Wall Street hedge funds was a total mistake. He also admitted that he hasn’t always followed his own trading strategies, which cost him big.
Finally, I love his advice for young adults when it comes to entrepreneurship. He is so right that society is full of BS-ers. I’m a big believer that you can figure out a solution to a problem (no matter how big or small), and make a living from it. I think too many people these days are ignoring the hustle.
What are your thoughts on Tim’s story? Have you traded penny stocks? What are your thoughts on “feeling okay being rich”?
Discover How You Can Be Debt Free
Join the 21,000 other members who've already taken the first steps towards student loan freedom. Sign up and get my five free tactics to lower your student loan debt.