Options disclosure: "Options involve risk and are not suitable for all investors as the special risks inherent to options trading may expose investors to potentially significant losses. Please read Characteristics and Risks of Standardized Options at tastytrade.com/disclosures before deciding to invest in options." In this insightful conversation, the host sits down with Scott Sheridan, CEO of TastyTrade and co-founder of the revolutionary trading platform Thinkorswim, who shares his decades of experience navigating volatile markets and building successful financial technology companies. Scott discusses his contrarian approach to current market trends, explaining why he remains skeptical of popular investments like cryptocurrency and gold while emphasizing the importance of options trading during periods of high volatility like we're experiencing now. The interview explores Scott's entrepreneurial journey from floor trader at the Chicago Board Options Exchange to creating two major brokerage firms, focusing on how he built strong company cultures and the critical importance of timing, team building, and maintaining vision while staying flexible enough to pivot when necessary. Scott and the host delve into practical investment strategies for uncertain times, with Scott advocating for consistent market participation through dollar-cost averaging and his current preference for selling puts in quality stocks during high-volatility periods. Key Takeaways: * Trade small and trade often - consistent market participation with manageable risk beats trying to hit home runs, especially for those just starting their investment journey * Focus on what you can control and maintain strong risk management - whether in trading or business, calculate your risks and never invest more than you can afford to lose * Build businesses and hire teams based on trust and complementary skills - successful partnerships require people you'd trust with your financial future, and company culture flows from authentic leadership rather than corporate buzzwords Head over to podcast.iamcharlesschwartz.com to download your exclusive companion guide, designed to guide you step-by-step in implementing the strategies revealed in this episode. KEY POINTS: 02:34 - From floor trader to tech pioneer: How Scott transitioned from trading at the Chicago Board Options Exchange to co-founding Thinkorswim, revolutionizing online trading by creating sophisticated platforms that retail investors could actually use. 05:35 - Why this market crash was different: Scott explains how the recent volatility was completely self-induced by political decisions, making it unlike previous crashes and creating unique opportunities for prepared traders. 06:09 - The young investor's advantage: Why people in their 20s and 30s need to take significant risks and stay engaged with volatile markets, since they have 40-year time horizons that virtually guarantee higher returns. 13:01 - The psychology of trading size: Scott's gambling wisdom about getting opponents to play for more than they're comfortable with, and how to know immediately if you're trading too big by your physical reaction. 35:00 - Selling flood insurance after the flood: Scott's current strategy of selling puts during high volatility periods, explaining how elevated option premiums create profit opportunities for patient investors. 39:40 - Building culture through trust: How Scott creates family-like company environments by challenging employees beyond their comfort zones while promising that any mistake can be fixed with time and money. 52:54 - The entrepreneur's regret insurance: Scott's passionate plea to anyone considering starting a business - the worst outcome is working for someone else again, but the regret of never trying lasts a lifetime.
Chapter 1: What is the main topic of this episode?
Hey Vodafone, ich weiß ja, schnelles Internet für meinen Betrieb hat seinen Preis. Nö, bei uns nur den halben. Wie wär's zum Beispiel mit bis zu 1000 Mbit pro Sekunde für nur 29,95 Euro im Monat?
Die Firma dankt.
Und die Fritzbox gibt's gratis dazu. Passt? Deal. Jetzt 50% auf Ihren Business-Kabel-Internettarif sparen. Im Shop oder auf vodafone.de slash business. Willkommen bei der I Am Charles Schwartz Show. In dieser Konversation, unveilt Scott seine kontrarianische Philosophie, die seinen Handels- und Geschäftsanspruch beigetragen hat.
He reveals why popular investments like cryptocurrency and gold don't make sense to him and how understanding market psychology and option volatility can turn periods of fear into profitable opportunities.
You'll discover why conventional investment wisdom often fails during unprecedented times and how embracing calculated risks while controlling what you can becomes the foundation for building sustainable wealth.
So if you're ready to learn how one entrepreneur turned floor trading experience into multiple nine-figure exits while navigating some of the most volatile markets in history, grab your notepad and prepare to rethink your approach to both investing and business building.
Scotts Insights are battle-tested, grounded in decades of real market experience and packed with actionable wisdom that could transform your financial future forever. The show starts now. Welcome to the I Am Charles Schwartz Show, where we don't just discuss success, we show you how to create it.
On every episode we uncover the strategies and tactics that turn everyday entrepreneurs into unstoppable powerhouses in their businesses and their lives. Whether your goal is to transform your life or hit that elusive 7, 8 or 9 figure mark, we've got the blueprint to get you there. The show starts now. Hi everybody, welcome back to the show. I am excited to have Scott on with us.
Scott, thank you for joining us.
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Chapter 2: How did Scott Sheridan start his trading career?
Und ich sage, okay, lass mich dir eine Frage stellen. Wenn du auf der Straße crossst, siehst du beide Seiten. Und sie schauen mich an, wie ich natürlich beide Seiten sehe. Ich sage, okay, dann weißt du, wie man Risiko und Erwartungen evaluieren kann.
100%. People don't understand that. They live in their demo trades, which is great. It's fun to play there and you can do it. The minute you get out of your demo trade, I remember I did this with Forex. I was like, I'm going to learn Forex. I'm going to trade Forex. It's going to be great. I made fortunes in Forex in a demo account. Then I went live. I was like, okay, this is a different ballgame.
Same thing, same charts, same environment, but since it was real and I had to pin out of the grenade, I couldn't function anymore. It is what it is.
You're not alone. That's why the mantra of the network just rings so true to me. Trade small, trade often. But small is the key.
And I learned that my risk came on to your point of looking back and forth. If I could understand how a road works, of what car was going to hit me or not going to hit me, I can invest in it. So I only invest in things that I understand. And regrettably, when I look at stocks or options or puts or calls or Forex or any of that,
I don't fully understand how much of it is self-fulfilled prophecy, which people are like, oh, it's Fibonacci, so it's going to go here and therefore it's going to do this. And they do that versus how much is actually happening versus what happens when a certain politician says something and then things change radically as well.
So for me, not having that, I only invest in things that I understand. Eine der Dinge, die ich nicht so gut verstehe, wie du es machst, ist, Unternehmen zu wachsen. Und du hast es auf einem wirklich beeindruckenden Niveau gemacht. Und du bist durchgekommen und du hast Dinge gemacht, die ein bisschen wie Gibson in den Grand Slam oder in den Home Run gespielt haben. Es ist wild, was du gemacht hast.
Es ist wirklich, wirklich beeindruckend. Thank you. What are some of the things that you've done, and you talked about it, and I love that you brought this up, and as hard as I pushed you on the opposite way, you immediately went back to the truth, which is, it's not just me.
You have to hire a team, you have to be surrounded by people that you like working with, that you're connected with, or you're doing something fun, where you treat them like family. But there's a lot of people who immediately want to go into systematizing and not understanding that you have to build culture, and you have to build all those other things along the way.
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Chapter 5: Why is options trading emphasized during volatility?
On top of that, one of the things that we have led the charge in for the last 25 years is education. And our education is free. You know, there's no, we don't charge for it. So somebody can go on online, they can watch live or we record the shows. We do about 15 hours, five days a week of live programming. Amazing stuff. Everything from a where do I begin to complex math.
So whatever your range is, we've got stuff out there. Other firms have information, they have education. So my ask is that people take time, put effort into this. This is not an easy business, but whatever business somebody is in, it's probably not an easy business. It took time to learn whatever they needed to learn to do whatever their job is. This is the same thing.
The stock market is not something, in my opinion, that you can just put five minutes a week into and say, well, I hope I make a lot of money. Now, if somebody... doesn't have the time or the interest, but they do have the money, your comment about just buying the S&P or QQQ, something like that, so you have NASDAQ exposure, S&P 500 exposure, works.
Low expense ratio, so you're not paying somebody 2%, 3%, 4%, because to me, you just don't need to do that. And if somebody says, well, paying 2% or 3%, it doesn't really make a difference, it really doesn't. We've done studies.
It doesn't make a massive amount of difference.
massive amount over time. You could see the returns over time and how much they change. You know, if you have an expense ratio, if you're paying 30, 40 basis points, 25 basis points. So it's there for the taking if somebody wants to put the effort into it.
So there's a lot of issues where people, A, they don't have the bandwidth. So either time, intelligence, whatever it is, it's just not their cup of tea. For example, I'm phenomenal at baseball. I'm horrible at basketball. So I don't try and do that. So outsource, it just is what it is. So if someone's like, hey, I know I need to do this.
There's real estate, there's options, there's all these different things that are coming in. If they don't have the bandwidth and they don't have the bandwidth, is it, again, I'm just trying to help people out, do they go in and just S&P, QQQ, whatever it is, walk away from it? Or do they say, no, this is important and I can make a living from this?
Because there's a bunch of people who, again, they've never seen the pullback. And you've got these crypto bros who think Bitcoin's always going to rise and take off and we're going to eliminate our currency by going to a cryptocurrency, which drives me nuts. So where do you, how do you help those basic people versus the ooh-la-lahs, the people up here who are moving things around?
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