How to Survive When Trading in 24/7 Markets

0:00Hello and welcome to IBCR Podcasts. I'm Stephen Levine, Senior Market Analyst at Interactive Brokers. We are host for today's program. Today we'll be straddling the intersection, perhaps we can call it the crossroads. This is where traditional markets meet digital assets. I mean, that's crypto trading becoming increasingly mainstream and here with us to provide insights into this really pivotal topic at this structure. Adrian Reed, founder of Enlightened Stock Trading and a trader with more than 20 years of experience developing rules-based systems and back-tested strategies. So great to have you here Adrian. Thanks for joining us. Thanks so much for having me on the show. Yeah, really excited to do this. Yeah, I'm excited too. I mean, it's a really timely topic, especially, you know, markets seem to be shifting. They're constantly shifting, it seems, in terms of market structure. We've been seeing an increasing volume of tokenized real world assets like stocks. Of course,

1:05the move to 24-7 trading, which we'll talk about. And this is great. You've been focused on systematic trading for 20 years, right? 20 years. Is that right? Yeah, that's right. That's right. Great. I mean, that's longer. I think that Bitcoin's even been available for trading. I think that launched in 2009. So, you know, I'd love to start, you know, learning more about what you do. I think our listeners would love to learn more about what you do and how you first became interested in systematic trading. And what's kept you involved for the past two decades? Yeah, absolutely. Let's start with that because what's kept me involved is really what's going to get people excited about this. It's, the markets are a constant challenge, right? It's a puzzle to be solved. It can never be solved completely, but you can find little bits of the solution and then that hints to other bits of the solution. And so you gradually just build increasing sort of awareness and understanding of how the markets work and how to extract an edge from the market and profit from that and how to sustain the game when the market's changed, which is a lot of what

2:08we're going to talk about today, I think. So, it's that sort of puzzle nature of trying to figure out how the markets work that really keeps me excited about it. And it's one big puzzle. That's got to be a huge puzzle for 20 years. You know, that's a lot of pieces. Of course, and look, there's a lot of different markets to trade, a lot of different types of instruments and you know, quite a number of different types of systems, which I'm sure we'll talk about as well during this session. So, what got me interested in systematic trading in the first place was really a process of elimination, frankly. I mean, when I started in the markets, I was looking to build wealth and ultimately replace income, just like most people. And I tried a number of different strategies, different approaches to the markets and most of them either didn't fit me or I didn't enjoy them or they didn't fit with my lifestyle or I didn't have, you know, the level of quant research or, you know, PhDs investigating the problem that the fund has. And so,

3:13really what I did when I started trading and investing was prune all of the different options and settle on the one approach that makes the most sense for me personally as an analytical, kind of logic oriented person. And fit my lifestyle as a, you know, a busy person who wasn't trading full-time at the time. I had a full-time job and I had a young family and I didn't have a lot of time. And eliminated the emotions that I was feeling and suffering from because, like most people in the markets, you know, as soon as I got involved and as soon as real money was there and it was moving up and down, my emotions were swinging around and I found that I wasn't able to make consistent decisions. And look, long story short, I read hundreds of books and when I discovered the market wizard series of books, which is fantastic, a great set of interviews, I looked at all those different interviews and really started to identify what I did like, what I could do, what I

4:13didn't like, what I couldn't do and filtered it all the way down and what was left was systematic trading, algorithmic trading. You might call it basically the same thing. And as soon as I found that, I went deep on systematic trading. I launched my first strategy and stocks started making money finally and then over time diversified added more strategies, added more markets, including ultimately crypto. Unfortunately, not in 2009, I was, you know, somewhat of a slow adapter in crypto, but you're not alone, you know. So yeah, that's kind of the journey and I discovered it. I kind of said, well, systematic trading because as an analytical person who realized that emotions were the killer of trading results and I like to test, to create hypotheses and test them and prove that I understood something about the way the market worked. And I didn't have a lot of time to implement and research day-to-day systematic trading really made a lot of sense.

5:16Yeah, I think it's really, really fascinating. And especially when you touch on emotions, I think we should maybe touch on that as we go, but it seems like there's a lot of emotional emotions factored into the decisions being made in the crypto space. And I don't know how much of that is really predominant or the driving force for a lot of the major swings that we see in some of these. But maybe we can talk about that as we go. I mean, I'd love to have maybe some kind of, maybe we should just start with a big compare contrast picture with your approach. With systematic trading of stocks, with the crypto markets, I mean, just even touching on the relatively recent launch of Bitcoin, most of the crypto assets we've talked about, really pretty new. And not just Bitcoin, Bitcoin might be the oldest, I think, of these currencies. Most of them have been around just after that, right? Yeah, absolutely. Look, the market is pretty new. But in terms of

6:19the approach from a systematic trading perspective, I would say the process for developing strategies is the same. It's find an observable behavior or type of move in the market, hypothesize some rules that capture the entry and exit around that move, test those rules and use a number of tools to optimize and fine tune them, optimize not to find sort of the exact parameters that work the best, but to validate that the rules that you've come up with work over a wide variety of conditions and a wide variety of parameter values. And I'll talk more about that sort of as we go. And once we've validated it, sort of test it on unseen data, on related markets, on other markets to make sure that it holds up over time. I mean, at a very brief 30,000 foot view, that's kind of the the steps that we go through. And the challenges really with crypto are that there's not a lot of

7:23history. And in that short period of history that we've got, the market has changed immensely. And the reason it's changed is because it's maturing. And you mentioned earlier, we talked about emotions and how, you know, it's a lot of the moves and the behavior and crypto driven emotionally. And that's true. And that's true of all markets, right? There's a lot of emotion in all tradable markets. But in crypto, the volatility has shifted dramatically over time. It's really come down. If you look at Bitcoin and the average volatility from when it first launched to now, in percentage terms, is much, much lower. And that's because the market is maturing over time. It's because it's becoming, I mean, yes, retailers are still involved, obviously, but it's becoming more institutionalized. There's bigger holders, there's funds, there's, you know, big, big institutional money involved. And that damp, that tends to dampen volatility.

8:23It does probably reduce the amount of emotion in the drives, the moves a little, but it's still there. So we have our process for developing systems. And we have a market that is shifting over time and doesn't have a lot of history. So we need to be really careful when developing strategies for crypto. And the biggest trap is to run a strategy development process over the whole history, starting all the way back at the beginning of Bitcoin to now and develop your rules around all of that limited data. Because that first period, the first, let's say, 7 or 8, 9 years was characterized by very large volatility, huge trends, equally huge bear markets. And if you look at the behavior today, it's just not like that. You know, we don't have the huge multi 100,000 percent moves in the mainstream crypto tokens now, then we did back then at the beginning. And so we need to be careful not to assume that that behavior from way back then is the same as what we have now,

9:29which gives us even less data to deal with because we sort of got to ignore or put a set aside some of the early data and focus on the more recent data to develop strategies that work in the current environment. So you recall the early days of Bitcoin, something of a fat tail, I suppose, in terms of the pricing behavior and volatility. There were more outliers, there were probably more extremes early on. The bull markets and bear markets were much larger earlier on. I mean, the first couple of big bull, Bitcoin run ups, bull markets were just astronomically huge. Compared to what we're seeing today, which is behavior much more like a high beta sort of text stop. So I would say the behavior in Bitcoin especially, but probably crypto more generally is heading towards what we see in text docs. It's not quite there, it's not exactly the same, but that's sort of the analog that makes the most sense right now. And that also drives the sort

10:30of strategies one might look at when we're developing systems or strategies for the crypto market, because we don't have a lot of history, so we're going to look somewhere else to get ideas and to validate our rules and so on. And I like to look at the tick market to get a view on where that's going and what type of strategies would actually work and make sense to start with. Yeah, it makes a lot of sense to me. I think that the people who are investors are going to crypto see it as maybe in part a currency play, but they also see it as as a technology play themselves. And so I think as the market, as you say, maturers or definitely as it's maturing around blockchain, et cetera, these currencies become more intertwined with the technologies that they are responsible for, I suppose, if you, yeah, that's that's that's sort of where my mind goes with it. I'm understanding like gold, sorry, Bitcoin digital gold, Bitcoin

11:35as a store of value and as a technology play, for example. And that's what I hear from those who are assessing or analyzing its fundamental, quote unquote, properties as an asset. Yeah, I'm quite cautious about, I mean, I don't really like the term cryptocurrency currency, because it's not quite the same. I mean, it's something you can exchange for something else. So you can buy things with it. So I guess in that respect, yes. It's not really a store of value like gold is, I mean, that was a physical thing. It's a digital token that we have agreed a value on based on a market that trades. And some of those tokens like other currencies, minor ones, well, many of them tend to go towards zero over time because there is no value there.

12:35So I treat it as a risk asset. And I think the market does too. When the market goes risk off, crypto falls. When the market goes risk on crypto rises. And so it's driven like that. That's a behavior that we see in high beta stocks, in tech stocks. And I'm certainly, I don't treat something like Bitcoin as a store of value like, oh, I'll just put all of my residue, my spare cash there. And it will store value over time because a market that can fall 50% in a very short period of time is not a particularly great store of value in my view. I view it as a tradable asset because it has liquidity, it has volatility. And all of the usual factors influence that particularly, you know, supply and demand and perception and emotion and all of that. And the state of the kind of the confidence in the economy, the risk on risk off

13:37kind of nature of the current situation. So, you know, I really just view these things as tradable assets. And I don't like the idea of just clocking cash into these markets and hoping that it stays stable in value because that's not really what we've seen. We've seen a lot of volatility historically. Yeah, I haven't, I haven't heard of them as a safe haven asset. Alongside other, you know, Swiss Frank or Treasuries or physical gold. So interesting stuff. I think maybe if we switch gears a bit and think about or talk about how your practice or how your strategies or approach to looking at the stock market or looking at stocks and price behavior might change. I don't know. I'm thinking it probably has changed with

14:40technology over time. High frequency trading and and Algo trading, et cetera. But now we're talking about 24 seven trading. So I'm wondering how this might affect your strategies. I have a picture in my mind that tokenized stocks, which I understand are representative of stocks that you can trade on various exchanges. Now I think there's something called ondo and B stocks and X stocks. And I also understand that okay, tokenized assets or real world assets themselves have spiked. I mean, there's something like 270% over the last year. And most of this or a lot of this has to do with equities. So a lot of stocks and ETFs are now being tokenized and available for trading 24 seven. And I wonder if that picture looks different than the traditional or quote unquote

15:42traditional markets where you have after hours trading where you have weekend closures. Is the liquidity different in these time periods, for example? How do you look at these two pictures? Yeah, look at it definitely changes the way the markets move and the way strategies work and where the liquidity is. In a traditional market where you've got a daily open and a daily close, there's a concentration of liquidity around those two reference points. And that's because a lot of people use it as a reference point. And that's where particularly the closes where a lot of big players will make their transactions. In the absence of that, the liquidity tends to be more spread out is a little thinner. There will be concentrations because not everyone is going to trade 24 seven. You know, New York comes awake at a certain time and goes to sleep at a certain time and London does the same thing just like in the currency markets. So, you know, we've already got

16:47many years of kind of precedent, I guess, in the currency markets where currencies are moving pretty much all the time. But currencies also move differently to stocks. And stocks that have a lot of after hours trading move differently to stocks that don't. I mean, not every market has all of these things. And so, I guess one of my principles is that the markets will change over time and they always do. And we need to be on the lookout for evidence that it's changed and evidence that our strategies are still working or not working and eroded. And one of my principles is that I don't want to be so concentrated in a particular market that if that market changes, my profitability is destroyed. So, for example, I don't just trade US stocks because if there's a big shift in the way the US market worked, then the whole portfolio is affected. I trade Australian stocks and US stocks

17:48and Canadian stocks and Hong Kong stocks and I also trade crypto. And I've looked at other more emerging markets, things like Malaysia, Taiwan, Thailand, really small markets because they're much less mature as a stock market. So, the behavior is a long way behind say the US. And so, as an individual trader, one of the things that we can do to prepare ourselves for these shifts, which we may not be able to predict exactly, is to diversify more broadly so that our entire portfolio isn't affected by that shift. Now, is there going to be a shift? Yeah, absolutely. Is tokenization going to continue? Yes, I suspect so. And will it become more and more 24 hours? Yes. Which means our stock trading is going to become a little more like crypto in the sense because crypto is decentralized right now. You can trade it 24, 7, 365. There's always an exchange where you can make a trade. And that means the open and the close don't have the same kind of

18:54meaning as they do in stocks. In crypto, the open is a notional time at zero GMT, right? So, it's different and we need to be monitoring how liquidity changes, how slippage changes, how price moves change. We don't get overnight gaps if you're trading 24, 7 literally, there's no gaps, right? So, there's different, some signals will disappear. Like, if you have a strategy based on gaps, that's gone. But you might have strategy that keys off reference points, you can still do that. You might have a limit system that says, okay, based on the high of last 24 hours or the highest high of the last X days or something like that, you can still set limits and set stock points. But it just changes how you do it because you don't necessarily king to a particular point like the open or the close. Yeah, it's really fascinating. I know that there's been some use of, say, weekend trading on certain assets like perp futures, for example,

19:58to find price discovery on when, say, the CME opens, for example. And so, there's this sort of hybrid effort to find that price discovery, either for the future of the commodity at hand or even, like, say, pre IPO, SpaceX, there's a lot of open interest on a 24, 7 exchange like hyper liquid, for example, that gave enough information to arrive at some kind of valuation for that IPO. I thought that that was also pretty fascinating. So, I mean, do you see any kind of change that might point to different kinds of what used to be openings or maybe openings? I don't want to say used to be, but some kind of opening as the 24, 7 exchange continues to operate in parallel or alongside a traditional exchange. Yes. I mean, if you look at a market where there's continuous

21:06price discovery and then alongside it, there's another market that trades the same asset that doesn't have a continuous pricing, it's got an open and close. You know, that market that doesn't trade continuously tends to gap, right? Because there's continuous price discovery in the other market. And if it doesn't gap to match the current price, then there's an arbitrage opportunity. And there probably are arbitrage opportunities, but they very quickly get, you know, arbored away by, you know, biggest smarter players with better tech and faster pipes. So, if you have continuous price discovery and you have assets that are not traded continuously, the baby starts to look different, more erratic, those sorts of things. So trading on those assets becomes, I would say probably more risky because you've got liquidity outside of regular market hours that you can meaningfully trade. If there's a couple of hours of after hour,

22:08actually like in the traditional stock markets, pre-market trading, those sorts of things, it's not quite the same as if Bitcoin is trading all night on a decentralized exchange and then it trades occasionally, you know, during regular hours on a traditional market through some sort of, you know, listed instrument. So, this shift changes how assets will move. And whenever whenever the nature of price movement changes, your market edges, your systems, your strategies are at risk. And so the key message is, as this shift happens, we need to very closely monitor all of our strategies and make sure that they hold up. And we need to consider how much we're relying on things like the difference in price between the close and the following open because that disappears, you know, how much we're looking at overnight gaps because that can disappear or change. And adjust some of our strategies, we're going to be turning more strategies

23:10off as that edge disappears and we're going to be finding more strategies and starting new ones up to replace them. So it's not a time for complacency and expecting that everything you've always done will always work, it won't. Now there's other inflection points in the markets that we can look at. I mean when high frequency trading came in, when decimalization happened way back and, you know, these things create shifts in the way the market moves. And if you back test some strategies, you know, back 10, 20 years, you can see these inflection points in the markets about how when edges are rooted and changed and usually edges erode, they don't usually get better over time. I mean occasionally it can happen, but we need to be looking out for some of these changes to make sure that it's not a point that drives erosion beyond sustainability. Yeah. So it makes a lot of sense. And you know, I'm already sort of becoming the more you talk about, you know, what will change in terms of what was likely to change or what you have to monitor as this transition starts to happen

24:14more and more in terms of your strategies. I start to become very forward looking nostalgic, I suppose. I wonder what kind of this is, you know, sort of on the edge of, you know, what we're talking about. But what else do we lose exactly in terms of our market sentiment and our market, and our trading behavior as we start to lose after hours trading is we start to lose the sense of weekend trading as we, as our psyche becomes so completely integrated with we are always going 24 to 27, 365 days a week. No, not even in new holidays, we'd all the federal holidays, it will skirt those two. So I in daylight savings time used to be a big thing I remember and say behavioral finance. I suppose that was something where, you know, traders would just become adjusted to the change in the hours of

25:16their sleeping patterns and that would affect their abilities to, you know, push the right buttons. So I wonder if we're losing or what in your, in your opinion, do you believe this that we'll become, we come nostalgic? Well, the downtime when the markets are closed to make calm decisions based on a purely logical analysis goes away. I mean, if you compare right now trading systematically algorithmically, algorithmically in cryptobus stocks in a traditional stock market that's not 24 seven, right? In stocks, we have this great luxury. When the market closes, between when the market closes and when it opens the next day, we can do all our analysis and make our decisions for the next day. And we have a lot of flexibility about when to do that because the time between when the market closes and the following open, there's many hours, right? And and look, that's, I got to say,

26:22for the longest time, that has been just a fantastic blessing because end of day trading, you know, swing trading, trend trading and above, rather than intraday trading, it's just such a relaxed way to operate in the markets in the market closes. You wait for your data to update, you run your models, your systems, your generate the orders for the next day and you place them. And then when the market opens, you know, off we go, and then we do it again the next day after it closes. In crypto, it's quite different because the market is 24 seven. And this is where tokenization takes us, right? So if you want to trade longer time frames, you've kind of got to choose a notional open close point for the day. You can also trade a four hour, one hour, or 30 minute, or whatever. I like longer time frames because the longer the time frame, the bigger the moves, the more signal, the less noise, I'm also the less activity. I don't like frantic levels of activity, the less record keeping and and accounting and all of that. And you can still capture big moves. So I like longer time frames.

27:28In order to trade longer time frames in crypto, you've got to choose a kind of notional open close point where the daily bar cuts over to the next day. And that's at midnight UTC. And at that point, if you're going to make your decisions and place your trades for the next day, the next open, you've got to do it immediately at that moment. And that's not always convenient. So we've, we've lost the convenience of being on a sit back and you know, fitted in easily with our lifestyle and place the, you know, do the analysis and place the trade sometime between closed open. We've got to do it right then as fast as possible at that moment, if we're going to trade in that way. And so that means things like automation become very, very important. So in crypto, I mean, in stocks as well, I trade 100% like fully automated. But I would never consider trading at 24 seven market manually because it's just too restrictive. You have to be at your desk at that moment every day at the same time. And I just don't want to live my life like that.

28:33Yeah. All right. You take your shifts like, you know, keeping watch, right? They had that in certain wartime, right? You had somebody keep watch and then, you know, you let the other person go to sleep and then, you know, you change, you change, you change, you change. I would say that I think there's a temptation to, to assume that 24 seven trading means you always need to keep watch. And I think that's a mistake because, you know, we're human. We need to rest. And I went way back at the beginning of my journey, journey, I mentioned the market with his books earlier. And one of the interviews that really affected me negatively was an interview with a currency trader. I forget the name. It doesn't really matter. But he was always keeping watch. You know, there were screens in the bathroom screens in the bedroom and he'd wake up and his check his phone in the middle of the night. Like check his signal service in the middle of the night and all of that. And I looked at that thought, oh, you know, no, I would never want to

29:33live that life. And I think, I think it's a trap because checking the market more frequency, more frequently is not correlated to higher profitability. It is correlated to higher stress levels, higher emotional burden, more burnout, more noise, more frustration. So just because we go 24 seven, you know, I would caution against 24 seven monitoring. I think what we need is strategies that survive the 24 seven cycle and keep us safe. And a lot of that means we sort of need to stay outside the short term noise and be able to make a decision at several points in time. Now, you may arbitrarily decide what those points are. I mean, you might do it at midnight. You do see or you might say, okay, well, I'm going to shift my day and I'm going to do my analysis

30:34at a different time and I'm going to construct my own daily bars and do the analysis that way and make my open clothes cut over at a different time of day that's more convenient or you just automate the whole thing and ensure that the strategies can survive that intraday volatility. Yeah, that's I mean, it's a mammoth prospect, I think, to carve up times within the day that you're going to do this, but you have an entire continuous canvas of activity that is flowing constantly with every asset class as they become tokenized. I think that it's it's it's basically today's markets on chain. And I do find that sort of fascinating. I think there's I mean, there's sort of two ways to deal with it really is you create a no-show daily bar and you use the open and the clothes at that time as the as a reference point to key off in your strategies or you create strategies that don't require that and have reference

31:40points based on the data, the historical data and say, you know, you put your limits, you put your stops in referencing historical press movements and those limits and stops just get adjusted over time in the strategy rather than worrying about a particular open or a particular close, you're more looking at ranges or highs or lows and so on within a particular range. So you don't have to have a no-show open or close, you can just assume as a continuous market and use price action and references to create your strategies. I think that's whole thing has been really, really interesting and it's it's it is in this juncture, this very pivotal transitional place, it seems to me where this market structure is shifting and you know, I just I just love to to hear from you how how you are contending with it as things go. Well, yeah, let me let me get into that. What I want to draw a draw a connection to though is something you said at the beginning is like, okay, for a long time to be figuring out the problem.

32:41Yeah, yeah, yeah, I'm still here and it's still interesting because the market shift over time, things change and behavior changes and rules change like exchange rules have changed over time and this is just another example of that. So now we're going to figure this problem out and I'm not going to pretend I've figured it all out. I'm you know, I've got enough diversification and strategies and markets that I'm going to be fine and I'm going to have enough time to adapt as these changes come through but what I am definitely doing is monitoring how existing strategies work and noticing how other strategies start to work. And so if if if I'm if there's anything that I'm doing, it's accelerating the the testing and the monitoring cycle of strategies. I think because the markets are evolving quite quickly now, you know, tokenization, everything as you said, moved to 24 hour, crypto becoming more mainstream. So these things are sort of converging.

33:46Things will change and edges will evolve and traders will get stunned if they're not vigilant. Yeah, so this is critical. And so that's the critical part I think of all of this is that microscopic view or look at what you know, it is going to be in the service of or disservice of those who are aiming to use these strategies that have worked in the past but may no longer be on the same level. Yeah, one thing I've done recently, which was quite interesting and useful in this space, is I've developed tests that can be run very quickly automatically on a large number of strategies to check that they're still valid and stable and representative of how they have performed historically. Now, this is it's important to know has the behavior shifted, has the edge

34:46shifted. And so if you're trading systematically, algorithmically, you want to know is the set of trades that I'm getting now, the distribution of trades that I'm getting now the same as it was historically or has the average, have the stats shifted. And so now in my own trading, I've got this tool that very quickly looks at the nature of the edge, the distribution of trades, the way the equity curve moves and says, okay, is that representative of what it was just a little while ago a few years ago. And if it is, then chances are the market hasn't shifted enough to break the strategy. But you do find that as the market shifts, as we get through these inflection points, as behavior and rules change, it just do shift. And we need to be monitoring our strategies closely for that no longer. I mean, we should never have been assuming strategies will last forever,

35:50because there's always erosion. But I think that's even more true now. We need to be monitoring more closely and more frequently. I wouldn't leave a strategy for months and months, assuming that it is still stable. I want to be monitoring on a much more frequent basis and make sure that I'm not seeing anything out of character in the strategy in terms of volatility, in terms of trade, distribution, in terms of win rate, in terms of size of win size of losses, and even correlation with other things. These are all shifting and we need to make sure that our portfolio is going to be safe. I think it's fascinating. Is there anything else that you'd like to add, Adrian? Look, I would say that despite the fact that markets are changing, I still believe very strongly that a systematic kind of rules-based approach to trading is critical, because for most people, emotions just get in the way. And emotional trading and decision making will destroy profitability, far faster than any subtle shift we get in the markets because of a rule change or tokenization

36:51or any of that. So, despite what we've talked about, that the markets are shifting and we need to monitor our edges and everything, having a rules-based approach will save so many traders from themselves. And it looks like we can adapt that to the 24-7. Of course. As with everything else, it's just an evolving market and certain things, in a sense, at the core that do not change. Yes, absolutely right. The things that don't change are the fact that a proven strategy that you have confidence in reduces your emotional swings and makes you more consistent. That doesn't change. The equation for profitability of a system of a strategy doesn't change. We've got the expectancy equation, which is the size of wins, times of percentage of wins, minus the size of losses, times of percentage of losses. That math has to turn out positive. Are you going to lose money? What also doesn't change is the need for careful risk management

37:57and position sizing. If we size too big, an unexpected loss is going to give us a drawdown that we can recover from. If we use too much leverage, then a sudden market shock is going to take us out. We've seen plenty of that. With pretty recently, this was a pretty prime example of just mentioning that you saw swings that were something like 18, 25% in the company. Yeah, just a little basically on leverage, I think. A lot of people were very, very, very leveraged and those losses magnify and they pile up quickly. There was a big hedge fund that basically, I won't say blue art, but failed just last week as of the time of recording. That was because of big leverage bets on certain markets. We've got to be vigilant and stick to good trading practice. That means not position sizing is a really small position in each ticket that we trade

38:57or token that we trade and not using excessive leverage or ideally not using much leverage at all and having a strategy that's proven and monitoring that strategy. I mean, it's just a good hygiene for traders and investors that doesn't change. Don't get crazy just because the world is shifting and we go to 24-7. There's some principles that will keep you alive in the game long enough to figure out the nuance of some of these new market rules. We've got to stick to that. My favorite saying, let me leave you with this, is that you can't win the game if you're not in the game. And if you do something that blows you up or something that could blow you up, you're not going to be in the game for long. So we need to stay in the game and that's the number one priority for everyone. You've got to stay in the game, which means you've got to not blow up. Making money is secondary to survive it. Yes. And if we can survive through these changes and observe what stops working and what starts working, then we can go on to continue to profit in the future. But if we trade so

39:59aggressively that a little shift, a little change in structure, a little change in rules, destroys our account, then we can't survive. We can't win the game ultimately. I'm so happy. You took the time to do this, Adrian. I hope you'll be back with those. Thanks so much for having me on the show. Really enjoyed the conversation and I hope it was helpful Thank you, thank you, thank you, thank you, thank you, thank you. Enlightenedstocktrading.com. That's where people can find you. Enlightenedstocktrading.com. We'll have those in the show notes as well. You're going to get a wealth of information that Adrian's been talking about. You can also read more commentary and market analysis, including from Adrian on systematic trading topics, as well as on the crypto markets at IBTR traders insight. A lot of great content there. Please also look to IBTR.com to find out more information about interactive brokers crypto offerings. For a full list of financial educational resources, visit the IBTR campus, where it's always all about educational material is provided to the public

41:00at no cost. Until next time, I'm Stephen Levine with interactive brokers. Thanks for joining us. The analysis in this material is provided for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies or other instruments, those references do not constitute a recommendation by IBTR to buy, sell or hold such investments. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and is necessary seek professional advice. Trading in digital assets, including crypto currencies,

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