Welcome to the third episode of Tradervue Conversations! In this episode, we interview Brent Nord, a professional trader who has been trading for over 20 years and who specializes in equity futures. In this conversation, you will learn how Brent started trading, how he developed his trading edge, and his advice for new and struggling traders who want to survive and thrive in the current market conditions.
Tradervue Conversations is a series of videos published on our YouTube channel where we talk to professional traders who share their experiences and advice. The first edition of Tradervue Conversations has several more upcoming episodes, so be sure to subscribe to our channel and turn on the notification bell so you won’t miss new episodes when they are published.
You can watch the discussion in the video right below or read the transcript.
Table of Contents
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Watch our conversation with Brent Nord here:
If you prefer to read the conversation instead, here is the video transcript:
How Brent Nord started trading and the markets he trades
Richard: Hello Brent. Welcome to this first edition of Tradervue Conversations. We’re happy to have you here. How are you? How is it going?
Brent: I’m great, Richard. Thanks for having me on.
Richard: Good to know, I’m happy to hear that. So yeah, let’s kick it off. If you could tell us a little bit about yourself, how did you start trading and what markets do you currently trade?
Brent: Sure. I’ll start off with what I trade right now. I currently trade equity futures, specifically the Nasdaq and S&P 500 futures contracts. I will also dabble in some fixed income stuff and oil very mildly, but mostly equity futures. And I also will trade some stock, but my main bread and butter is equity futures.
Your question was how I got started. Back when I was in high school, my father had a kind of light interest in trading commodities, and he would get this—so this was a long time ago, before anybody got computers at home—and he would get this gigantic Knight Ridder publication. It had every single commodity in a chart in it. It was probably like a 14×9 inch book—it was a big magazine. Anyway, he had it sitting on the couch one day and I asked him what it was and he kind of explained to me what commodities were and what these charts were all about and you’re just trying to predict the price of where they’re going, and I just became fascinated with it.
And so, we kind of started doing a couple trades, and my first trade was in coffee, and coffee was in a major downtrend and I thought “well, this must be the bottom, surely this isn’t the low”. Of course, we kept going lower and lost money on that. And we tried a cocoa trade and I lost money on that one as well. And I just became hooked, I was fascinated with the commodity markets and the charting. I started reading as many technical analysis books as I could on how to improve your trade, and when I graduated from college I moved up to Chicago and started up on the floor of the Mercantile Exchange, in the Eurodollar pit. And I just started there and [I’m] still trading.
Richard: Alright, that’s interesting. Just to get a little bit more context, how old were you when you were sharing this type of information with your father before?
Brent: Uhm, 14.
Richard: Wow. Okay, that’s interesting. So you were still at school at that time?
Brent: Yeah, I was in high school. I think I was a freshman in high school.
Richard: Wow. And so that’s how, basically, your career started.
Brent: Yeah, that’s how I became interested in it and just fascinated by it. When I went to college, it wasn’t to become a trader, it was to become something else. And I couldn’t stop holding it, and I said “well, I’m gonna give it a shot when I graduate”.
Richard: Wow, nice, nice. So, walk us a little bit through your first year when you started trading or doing some active trading. How did it go? Or maybe what lessons you got very early in your career? Can you tell us a little bit more about that?
Brent: Sure, sure. So I started on the floor and I was moved over to the Eurodollar options pit, but we had an overnight book that we’d watch. And it was the beginning days of Globex. It used to be a green and black screen—the old monitors. So it was fairly new and would make these markets for options overnight. It was 1998, and there was the big Asian market crisis, and so the equity futures were moving a lot overnight, and you can kind of follow the S&P futures when they were moving with the Hang Seng and the Tokyo indexes. And I just started trading that a little bit and getting involved with the futures there.
What I didn’t have was good risk management. So there were these huge swings on my P&L from just trading small futures. And—I forgot that was the question, right? Was it how I first started trading? Those were my first real trades, and then I eventually went down to the Eurodollar options pit and traded with our options group. But I was in love with trading on the computer, so I didn’t trade in the pit very long, maybe a year, and went right back up to trade on the computer off the floor.
Richard: Yeah, thank you for more information on your background, and I think it’s really interesting. So from where you started to actively trading, how long did it take you to become consistently profitable?
Brent: So there was a lot of movement back then in 1988 and 1999–that was when the Dotcom bubble was going. So there was a trade that I had figured out and I became profitable in my first year. But that’s only because the markets were advantageous for that. And I was on the computer and I could follow the Nasdaq and was able to get S&P trades done while I was watching that, so I had kind of an advantage, but that quickly evaporated. And the next three years were not great, they were like ups and downs, so I would say, until I was consistently profitable, it wasn’t until probably 2003.
Richard: Okay, so you had a good run because of the market conditions, and then you had a couple years struggling as a trader, and then everything started to click or, I’m guessing you had some “Aha!” moments in which everything started to come together for you as a trader, is that correct?
Brent: Yeah. So there was kind of a transformation in who I was as a trader. And I had blown out of one firm and went to another one and blew out there, and then I was kind of at a low point in my career where I had this advantage when I started and it wasn’t there anymore and I was still trying to figure out who I was and how I traded. The Aha moment was when I learned to take responsibility for all my trades and how to reflect on all the decisions I made during the day and evaluate them. For a long time I was just “ehh, it was a crappy day” and I didn’t really think about the trading too much and analyze it.
Richard: Okay, so walk us a little bit through what type or approach or what type of trading you were doing during those good market conditions.
Brent: So one of the big advantages I had was that on the computer I could execute pretty quickly, and I had noticed that the market would move a lot of economic numbers, whether it was CPI or employment, so I had an edge there. I was able to trade off the computer in the very early 2000s and able to catch some edge on numbers when they would miss big. And then, during the day, I was able to follow the Nasdaq and, whenever it would spike up, I was able to catch on to the S&P and I was still learning about levels and how they work but that was kind of my advantage then.
Richard: Okay, that’s really interesting.
Brent: That’s not necessarily how I trade still.
Richard: Yeah, which actually leads me to my next question. As of now, how would you best describe your edge?
Brent Nord’s trading edge
Brent: I would classify my edge as experience. I’ve been trading for over 20 years and I can recognize a lot of setups, but the one thing that I really like to do is to analyze market levels. And I would say my edge is just my approach to how I think about the market—I think it’s kind of unique. I wouldn’t say that’s arrogant, but I feel my edge is in my thought process and how I evaluate the markets.
Richard: Okay, very interesting. So you mentioned risk management; at the beginning, you were struggling with risk management and so you had these swings in equity or P&L. Can you walk us through the process that actually—or maybe that “Aha!” moment in which it started to connect the dots and make sure that risk management was not a problem anymore? Like, how did you actually tackle that? First of all, how did you identify that that was a problem and then what did you do to fix it or correct it?
Brent: That’s an interesting question because it wasn’t something I came to do on my own. I had to have somebody teach it to me. I had just finished blowing out of my other firm, and I had another friend who worked at another proprietary firm and he said “you should come over here and trade, there’s a great group of traders and the owner is fantastic” and I was like “alright I’m gonna give one last shot. Let’s see if I can really make this thing work as a trader”.
And I sat down with the owner, and he explained their approach. He had a bunch of tools and groups that we would meet with to teach us about how we would handle our losses. And he would put specific stops on before I had done any trade with anybody and would stop me at P&L level for the day. I just kept doing that on my own. But it was a hard stop during the day and if you wanted to get more rope to trade with, you had to talk to him and explain what your strategy was going to be for the rest of the day and how you would control your risk with that.
So it’s more like a person and a coaching session was the Aha moment. It wasn’t something that I came to on my own. I wish it was, but it wasn’t.
Brent Nord’s approach to the markets
Richard: Okay, And so, tell us a little bit more about, apart from your edge—like your approach to the markets, what things do you combine in order to trade? Like, what do you have for example in your charts? What things do you look at in terms of fundamentals or events? What is the thought process or preparation before actually putting a trade? How does it look? How does a trade look for you?
Brent: Sure, sure. That’s a great question. The biggest part is the preparation in the morning, deciding what could possibly move the market today, whether it is an FOMC meeting, some kind of economic report. And then it’s all about intermarket relationships, right? Because it’s not just the stock market, and if you only look at the stock market, you’re gonna not always see things clearly because there are outside things that affect each market. So maybe it’s oil that’s affecting the market, or maybe it’s fixed income that’s affecting the market today.
So it’s kind of like looking over the whole landscape and deciding what’s important today. And it changes every day, you never really know sometimes. Things might pop out of the blue, so I prepare myself by reviewing all the different markets and reviewing what news came out overnight and what news and events might be happening during the day, right? And so then I prepare my ideas. When you say technicals, well I’m looking at levels that other people would be looking at. I’m not necessarily trading off of them, but I like to know what everybody is looking at.
So that’s really like major moving averages, Fibonacci Retracements or trend lines. And when I’m setting up a trade, I’m looking—the one thing I coach traders, as well as being a trader, and one thing I tell them is you have to have an opinion on the market. If you’re going to make a trade, you can’t just trade because there is “oh, here is a trend line, I should buy it on the trend line, and that’s what they say”. Well, you have to have a reason for why you want to be bullish. It shouldn’t just be one technical indicator. There should be a whole market thought that says “this is going up and this technical is going to be used as my entry point for it”. Does that make sense?
Richard: Yeah, definitely. So, just to make sure I capture the whole idea, you’re combining what could be like a catalyst—the news, an event, you’re actually preparing in advance for that, and creating a bias before getting involved in any trade or position—and then you’re also looking at the charts to combine the two of them and actually execute based on technicals for timing and news, events, and knowing what’s happening in order to have a bias.
Brent: Exactly. You have to have some sort of, uhm, I think it’s important to have a bias. You have to have an opinion if you’re gonna get into a trade, right? And so where you get that opinion can be from multiple different sources. Maybe it was Netflix At earnings yesterday, it was terrible, so what would that do to the market? You know, those kinds of things.
Richard: That’s really interesting.
How Brent Nord adapts to the current market conditions
Richard: Let’s talk a little bit about the current market conditions. In the Twitter sphere if you will, and I also have a couple of traders who are friends of mine, everybody is kind of agreeing that market conditions have changed significantly from 2020. You know, like post-pandemic, post-QE, and all the monetary policies. And so what I’m trying to say is that market conditions have changed significantly since 2020. So what’s your take on how to adapt to current market conditions and what to do when your strategy kind of goes out of style?
Brent: So that’s another great question. I would say what I would say to everybody that I coach: risk management is your most important tool. And if you don’t have that, then you might end up not being a trader anymore, right? So if you’re having issues with your system—your system was working in one market and now these market conditions changed—what I would advise is that you need to go back and evaluate what’s wrong with your system, why is it not working, and see it’s possible to adapt or maybe your system is only good in an uptrending market.
Richard: Okay, that makes a lot of sense. And when it comes to risk management, tell us a little bit more about how you manage your risk with your current strategy or edge, a little bit of what happens behind the scenes in terms of risk management.
Brent: Right, sure. So when I talk about risk management, it’s not just monetary, right? You’re saving money, that’s money management. Obviously it’s very, very important because everybody has a point during the day where if you’re down this much money, you’re probably not gonna get back the positive. And everybody watches their P&L to a certain extent while they’re trading, right? It’s hard not to.
And so when you get to a certain point, it ends up not being about making money, making profitable good decisions, it becomes about “I gotta make back this money I just lost today”. So I find this spot, and I know what my spot is, and I see what, mathematically or statistically speaking, I’m not going to recover from this amount if I lose this amount today. The odds of me going back to zero or even coming halfway back are very small, so that’s a shut-off point for me.
So that’s a money management technique. But the other thing, when I talk about risk management with people I work with, is also about keeping your mental game and focus, right? You want to make sure that you’re sharp and that the decisions you’re making are also very smart. And if you have too many bad decisions in a row, regardless of what the money is, you can start to break down mentally. So it’s about keeping your mental awareness and your mental focus sharp, and keeping your money intact. So risk management on both sides, you know?
Richard: Yeah, I’ve heard that from a couple traders, how not only they protect their financial capital but they also protect their mental capital. Like, they want to make sure that, when the current market conditions are maybe not the best for them—for their strategy or their approach, they’re minimizing their risk and also minimizing their mental capital in order for them to be in the sharpest state or the best state of mind to push it when market conditions are not good.
Diving further into Brent’s edge
Richard: And so, I was thinking about earlier, you mentioned that part of your edge was your experience. Maybe I’m getting a little bit more into the psychological aspect, but tell me about when it comes to your experience, what specifically from it would you describe as your edge? How does that express [itself] in your trading currently?
Brent: Sure. So it kind of revolves right back to risk management. I’ve seen multiple instances where I’ve been involved in trades where things went much further than I ever thought they could. And sometimes you get a trade like “oh yeah, it’s past my stop, there’s no way it’ll keep going further, it should come back”. But my experience that I’ve seen is that sometimes it just keeps going. And it takes way further past your breaking point than you imagined.
So that’s one thing. The other thing is pattern recognition and seeing relationships and how markets work together and how one market can cause another one to move even though in previous it hadn’t. So it’s that experience of knowing how relationships work and how markets work off of each other.
Richard: Okay, interesting.
What Brent does to improve as a trader
Richard: So let’s get a little bit into the trader mindset. What are you doing on a daily basis or weekly basis, or a constant basis, to improve as a trader?
Brent: Another great question. The biggest thing I can say is to be informed and to be prepared. And to read all of your information to have a setup in mind. So one of the things I do is I coach other traders, and so I found that this keeps me grounded, and it helps understand what other people are seeing, and as I’m working through their problems with them, it kind of helps me stay on my toes to make sure that I’m continually doing the right thing. So I found that that’s been a big help to me.
But for somebody who is not coaching other traders, or being coached, I think it’s important to know what you’re expecting out of the market each day, and to be prepared to not trade, right?
Brent: But the other thing is I—sorry, I kind of got off track there, but reviewing your trades every day is super important, and to constantly be self-critical, and to understand what you’re doing right and what you’re doing wrong.
Richard: Yeah. So that’s a really interesting point—reviewing your trades. Can you tell us a little bit more about how you go about that? Do you have a system to review your trades? Like, what exactly is important for you when reviewing trades? Is it the whole execution? Is it how you manage the risk and then trade? Is it, maybe, the catalyst or the news behind—walk us through how the process looks like when reviewing your trades if possible.
Brent: Sure, sure. So what I like to do is that, at the end of the day, I look at my trades and then I like to manually plot them. I know in most software you can just have the computer plot them. But when I very started doing this 20 years ago, I found that actually writing down the entry points, just printing out a chart and writing the points, really helped me digest the trade that I did and understand my thought process when I made it.
So I would look at my entry points, like you said, and try to figure out what I was thinking, and if the trade worked out, [I would] also evaluate my exit to see if I stuck to what my original plan was, because if you’re going to get into a trade, you should have two exits already in mind. It’s not just get in because I think it’s going up, it’s get in because I think it’s going up to this level up here, and if it goes down, this is the point where I know I’m wrong. So I try to look and evaluate “did I stick to my exit strategy as well?”.
Richard: Okay, really interesting. And so, one thing I just remembered that I wanted to ask you about earlier, it’s about the time frame in which you trade. Are you trading in shorter time frames or longer time frames? Are you more like the selective type of trader or are you more like a grinder, you know, scalping the markets? That detail regarding your approach—can you tell us a little bit more about that and maybe what would you suggest to those traders who want to do a similar approach?
Brent: Sure. So I’ve never been a scalper, that’s not my thing. I know a lot of people who have been successful at it, it just doesn’t fit with my style, my approach to the market. But I would say I probably have between 5 to 10 real trades in a day. So I would say my time frame can be anywhere from a couple minutes to a couple hours. I would say most trades fall in the 15-minute range.
Brent: I’m in and out within 15 minutes.
Richard: Okay, interesting. So what are the things, and this actually goes back to the trader mindset, that you do out of the screen to have a good mindset? Like, what things are you doing in order to make sure you’re in your sharpest state, and that actually bleed positively into your trading?
Brent: Um-hum. So I think exercising is really important. So I try to exercise before the market opens, but if I don’t then I will try to do it sometime in the middle of the day when I feel like it’s slow. Because I feel like that’s a good energy and a good release of—just so that your mind can zone out a little bit, right?
Brent’s advice for new traders
Richard: So let’s say for example that I’m a trader and I want to get involved in the markets and I’m new and 100% a beginner. What would you tell a new, aspiring trader? Like things you would like to have heard before starting trading. What piece of advice can you give the upcoming traders?
Brent: Right. Okay, yeah that’s a good one. I would say that you have to keep your expectations low. You have to emotionally be prepared for major swings up and down. It takes a lot of time, and I wish somebody had told me that you should maybe practice on a simulator *laughs* before I lost a bunch of money.
But most of all, the risk management is so key, both the mental capital and the actual capital. And figure out a good strategy to always stay in a positive mindset.
Richard: Definitely. And so, would you agree—[with] you mentioning the simulator and risk management—I’ve read before that, at least in the first couple years, the first aim should be survival. Like actually staying enough in the game to see different market conditions and identify who you are as a trader and also what your edge could be. Do you agree with that? What’s your take on that?
Brent: 100%. I think that should be the first focus for a couple years—absolutely. Just try to survive, try not to make any, you know, career-ending mistakes, and stay in the game. If you stay in the game and you’re still there after a few years, you’re probably gonna be there for the rest of your life trading, right? It’s a wash out part. What was the second part of your question?
Richard: I just wanted to hear your take on that—on survival. And also, during that survival period, what you want to do to find who you are as a trader.
Brent: Oh yes. You need to come up with a strategy that’s yours and that you believe in. Using somebody else’s strategy is a recipe for disaster. It doesn’t mean you can’t take somebody’s strategy and fine-tune it for yourself, but you need to have confidence in every one of your trades, but also be willing to be wrong, but you have to have confidence. And the only way you get that is if you do your own homework and you have your own strategy. And it can be a combination of other people’s stuff, but you have to come up with your own. When you have your own, you’ll have confidence to make the trades, and you have the confidence to adjust it.
Richard: Yeah, I do agree. I mean, it sounds like this is kind of like a business where you get pieces from everybody and make it your own.
Brent: Absolutely. It’s kind of an art, right?
Richard: Yeah, for sure *laughs*. I do agree.
How to find your trading edge
Richard: So, that’s a super abstract topic and subject. I’ve seen discussions around that, like finding your edge and also knowing yourself, your personality, your strengths and also your weaknesses. What’s your take on, like, how do you actually go about finding edge and also getting to know yourself as a trader? Like, for example, how do you come to these conclusions like “hey, I might be a swing trader instead of a scalper” or more “maybe I’m more like a deep thinker instead of a fast thinker and I should be getting deeper into things instead of executing fast”? That’s a little bit abstract, but I’d like to know what are your thoughts on that? And—yeah, if you can share a little bit more about that.
Brent: Yeah, so that’s not something that anybody can answer before you start trading. It’s kind of like what kind of painter are you going to be? And you just can’t figure out what kind speaks to you, and what you feel like you’re successful with, and what makes you feel like you’re going to make money.
And, you know, the market will adapt to your personality and you’ll find a way of trading that is best suited to your personality. If you’re high-frequency, like “I need to be constantly involved”, well chances are you’ll start to automatically gravitate towards a strategy that allows you to have a lot of action. If somebody is a little more reserved and patient, you’re probably gonna be a little bit of a longer-term trader and be more willing to sit back and have a strategy that allows you to be patient and make less trades. I think your personality will automatically navigate you towards the type of trader you want to be.
Richard: Yeah, definitely. I’ve had some conversations with Brad—by the way, for those of you listening or watching, Brad is a futures trader also with whom we had an interview before, he actually referred you, Brent. I’ve had some conversations with Brad, [and we mentioned] keeping an eye on what things feel right for you.
For example, I was getting a little bit more into understanding the fundamentals behind the companies; understanding revenues and earnings per share in companies, and how they behave, and understanding those growth stocks that, all of sudden, gave a surprise to the whole market. That was something that, actually, I felt connected with me. And so what I’m trying to say is that he was always pointing out to checking how it feels, and it’s not hype; there’s something you’re naturally going to be gravitating towards because it just kind of goes with your personality.
That’s what I’m trying to think [about], and I consider myself as a big thinker and it made sense for me to be looking at that type of stuff. So, I just wanted to add that there, and what thoughts do you have about that?
Brent: That totally makes sense. I talked to Brad quite a bit. He and I started at a firm 20 years ago and kept in touch, and we talk very regularly still today—always about trading and other life things. But I agree; your personality and what you feel speaks to you is really important, and you have to listen to what makes you comfortable as a trader, right? Because as soon as you become uncomfortable and filled with self-doubt, you flinch.
Richard: Um-hum. I do agree.
Brent’s advice for developing and struggling traders
Richard: So Brent, we’re starting to run a little bit out of time, so what word of advice do you have for developing traders or those traders who are having a hard time in the current market conditions?
Brent: Sure. Don’t be scared to adjust your system and to play with it to make it work. Constantly be self-evaluating, and evaluating why things aren’t working instead of just saying “oh well, it’s a bad market. Somebody is making money, so I encourage the new traders to take a step back and evaluate exactly what they’re doing and take time to do some review. That’s the most important thing you can do as a trader.
Richard: Awesome. Yeah, I do agree. And actually, I wanted to ask you a question about that. So let’s say, for example, an intermediate trader [or] a developing trader found some edge, was doing good with their strategy during good market conditions, which was 2020 to half of 2021. So all of a sudden, he’s struggling, which I’m pretty sure is the case for a lot of developing traders after the pandemic. How do you feel about looking into other types of approaches, or actually learning new skills, or maybe approaching the market in another way? What are your thoughts on getting into new skills versus just focusing on your niche or focusing one one thing? Does that make sense?
Brent: Yeah, I know, that totally makes sense Richard. First, what I would caution, if you have a system or a style that you’re using, before you automatically throw it out and say “oh, it’s not working”, is to really dig deep and understand why it isn’t working to see what’s changed that makes it now work, and to see if you can still modify that before you completely scrap it and try something new. Because if you’re new and you’ve been working on a strategy for a long time, it’s a lot of work to just immediately throw it out if it’s already been working.
There is nothing wrong with trying new things and trying to explore those, but I would always do it in small size as I’m learning.
Richard: Um-hum. That makes a lot of sense. Thank you Brent. Where can listeners hear or see more from you?
Brent: Sure. So Brad—the guy you just mentioned—Brad Jelinek and I are starting a podcast where we talk about trading issues and things going on in the market. It’s TradingLifePodcast.com, check us out. Or if you want to email me, I offer coaching to people who are interested in learning more, my email is brentnord [at] gmail.com.
Richard: Awesome, sounds good. I’ll make sure to put that in the show notes description. Thank you Brent, it’s been a pleasure having you here and we hope to have you next time.
Brent: Great, I love being here Richard. It’s great talking to you.
Richard: Thank you.
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