Interview Central: Mark Seleznov, Part I
May 29, 2009
Mark Seleznov is the Chief Investment Officer of Seleznov Capital Advisors [SCA]. SCA is a SEC registered investment advisory firm that offers advisory services for Mutual Funds, Trusts, 401K plans and Individuals. Mark supervises the asset allocation programs of SCA in a variety of strategic and tactical objective strategies. He is the host of "Financial Review," heard weekdays at 2pm MT on the Financial News Network, KFNN Radio in Phoenix Arizona. www.kfnn.com
SCA served as the Sub-Advisor for the Equipointe Growth and Income Fund (EQGIX). Mark Seleznov was the Fund portfolio manager and was an organizer of Equipointe fund trust. He has experience in the creation of mutual fund and separately managed account strategies.
A professional trader and money manager for more than 30 years, Mark Seleznov was a market maker on the Philadelphia Stock and Option Exchange as well as a retail registered representative and futures trader. Mark is a recognized expert in trading of equities and has conducted technical analysis seminars in addition to his TV appearances, newspaper and magazine contributions.
It was a genuine pleasure to get to talk with such an accomplished money manager like Mark Seleznov. This is the first part of that conversation.
Optionetics: How did you first become interested in trading the markets?
Mark: I actually started as a teenager when I was fascinated at the changes each day of stock prices. In college, the approach was fundamental. They taught P/E ratios, book values, and vague terms about the quality of the management of companies. I soon found that those theories and approaches did not work in the real world. It did spur my interest in trading and created a lifelong passion for the markets.
Optionetics: Do you ever use options and if so what are your favorite strategies?
Mark: Yes. As a fund manager, we used covered calls as a strategy for income and profits. I have also used ratio writes and time spreads.
Optionetics: What are the things you like best about the trading business?
Mark: It is a challenge! Trading is profession that almost anyone can enter, but as in most professions, only the best will be very profitable. Many disciplined traders who use and follow a trading plan can be profitable.
Optionetics: How do you treat losses and how to go about establishing their risk tolerance before the trade is entered?
Mark: I am a systematic trader and believe in trading plans. If you ask most people they'll say they have a method, but when I say a plan, I mean real rule-based trading. Most of my trading plan development has been in Metastock and early on in Trade Station. If you cannot put your rules in a system tester, you do not have a plan. Today, there are several good system testing programs and brokers are now including these in their software. They realized that they keep more clients if clients have some system rather than being emotional seat of the pants traders.
Each plan has either a stop or rules and conditions that will take out of a trade. When you ask about risk tolerance, the real issue is drawdown. Some methods have smaller loss parameters, but a number of consecutive losses may cause drawdown that will not have a trader push the button again after a series of losses. By back testing trading plans, you have a better feel for drawdown, consecutive losses, time in and out of a trade, etc.
Optionetics: Thanks, Mark, for sharing your trading approach with our Optionetics reading audience.
Jeff Neal
Senior Writer, Options Strategist
Optionetics.com ~ Your Options Education Site
Questions for Jeff? Please visit "Ask the Traders" through the discussion board on the Optionetics.com home page.
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