Tim Sykes was just a senior in high school in 1999 when he received a bar mitzvah gift of $12,415. He took his birthday money and began trading penny stocks. His parents assumed that he was going to lose all the money but supported him anyways thinking it would be a good life lesson. Sykes told Nextshark:
“I didn’t really grow the account at first since I was invested in these bigger companies, so I gravitated towards lower-price penny stocks, which the whole world hates. But my $12,415 basically grew to over $100,000 by the end of high school.”
By freshman year of college, Sykes had made $700,000. He made his first million at 21 while vacationing on a cruise ship with his family. By his senior year, Sykes had become a multimillionaire.
“I studied stocks nonstop from the first day. I ditched friends. Even in college, I took night classes so that I could study and learn during the day. The education never stops.”
Sykes, now 34, has made $4.3 million in career stock winnings and has roughly $15 million in cash in the bank. His current full-time job is running a training program to teach others how to trade stocks.
“I’ve started back with $12,415 when I first started teaching in 2007. I took that money and turned it into $230,000 in three years. I was the number one trader on Covestor, which tracks people’s trades via their brokerage accounts. This year, 2016, I’ve gone back to $12,000 again, and the overall stock markets are down roughly 10 percent in the first few weeks. I’m up about 20 percent.”
Since he’s now trading with such small accounts, Sykes says he presently makes more money teaching than trading.
“I’m proud of the fact that I make more from teaching, because you know where my priorities are. For me, if my subscribers lose money, they’ll cancel on me. For me, it’s always about trying to teach subscribers how to make money.”
Sykes broke down the general principles of how he trades:
“You definitely trade fx different in each market. Three out of four stocks follow the market. So in a bear market, or when stock market prices are falling, I’m much more cautious. But at the same time, there’s usually a few plays every single day.
“There’s pump and dumps — where owners of a stock pump up prices with false claims and then dump it when it gains value — I like to bet against those. Did you see the ‘Wolf of Wall Street’? That still happens! Except I’m not the wolf — I teach! But I’m thankful for those wolves because they open up opportunities. Even though they’re scams and manipulations, you can never shut that down. What you have to do is accept that and educate the public. So what I try is teach people how to bet against these scams and to recognize whenever there is a pump and dump.”
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To roughly test Sykes’ skills, NextShark asked him during our interview to give us his best stock tip, with which we would invest $75 we had put aside beforehand in and then follow for two months to see if it rose in value.
He recommended we invest the experiment fund in a promising tech company known for their wireless, radio frequency-based charging technology. Most importantly, the company was speculated in a recent quantum ai elon musk interview to be partnering with Apple to put that wireless technology into their future products.
On February 16, following his pick, we purchased 13 shares of the company at $5.57 a share, totaling $72.41. As of April 6, the shares are worth $10.13 apiece and $131.69 in total, which calculates to about an 80 percent return. The results impressed us, especially considering the experiment’s proceeds netted everyone in the NextShark office a free lunch.
Even better than the casual $50 we saw, Sykes says he has had multiple students who’ve made millions, including one named Michael Goode. Goode started off as a Sykes critic and wrote a scathing blog post titled “Timothy Sykes is Full of Bullship.”
“He became my first millionaire student. Now he moderates my chat rooms and helps me teach other students. I love haters because I can turn them into fans.”
One of the things Sykes’ followers say they like about him is the fact that he’s transparent. He shows every single trades he’s made to get to his millionaire status and even shows his tax returns.
“If you’re going to teach about making money, you’d better be able to back it up. This is why I get invites to speak at CNN, Harvard, and most recently the ‘Steve Harvey Show.’ It’s because I show everything. I think that transparency is key to show that I’m real and sets me apart from everyone else.
If you have someone who claims to be successful out there, they must show every trade, statements, taxes and audits. That’s what I show publicly. There’s many people who are full of shit in the industry, the vast majority. Remember: 90 to 95 percent of traders lose. The people who teach, it’s basically a snake oil salesman profession. So I’m used to the hate just because people assume I’m one of them, but then I show everything.”
For people who want to get started, Sykes uploads free videos on his YouTube channel targeted at beginners. When asked what are some of the biggest reasons a student fails, Sykes said:
“Holding and hoping is a big problem. Others will buy stock and then go drop their kids off at school. I watch every single dollar like a hawk. For me, I want my finger on the trigger on the exit button whenever I see something wrong with a stock. Oftentimes, I get out way too soon. I’m right about buying or shorting a stock and I take a 10 percent profit. A couple hours later I could’ve gotten a 30 percent profit. I don’t mind because I want to play it safe. Rule number one is cut losses quickly.”
When he’s not working, he spends his days traveling, eating at fine dining restaurants, driving his Lamborghini and Ferrari around, and planning his wedding to his model wife, for which they’ve hired Kanye West and Kim Kardashian’s wedding planner.
While most become attached to attaining more wealth as they go, Sykes claims that money isn’t really driving him at this point.
“At first, it was a video game — I just wanted to get the highest score. However, I’m done with all that,” he said. “I’m not wasting money. It’s just stupid. You can’t take it with you when you die, it’s not what makes me happy at this point in my life. Now I get my adrenaline rush from teaching and that’s what fulfills me.”
Citation Link: https://learnbonds.com/uk/spread-betting/brokers