Inside the Mind of a Master Trader: Tyson Clayton

Inside the Mind of a Master Trader: Tyson Clayton
August 30, 2021 Market Traders Institute

If you’ve ever heard Tyson Clayton lead one of his weekly trading sessions for Market Traders Institute, then you probably understand well why he is widely regarded as one of the industry’s top master traders.

Clayton is a 20+ year veteran of the financial markets with broad experience as a trader and educator in stocks, options, Forex and cryptocurrency. He has a unique eye for using automated systems to find setups before the crowd does.

As a Senior Market Strategist with MTI, Clayton shares his expert strategies and market analysis with thousands of students through his Money Flow and Equities on Demand Trading Rooms. He also co-hosts MTI’s Weekly Investment Draft series on YouTube along with analysts Chris Pulver and Gary Fichardt.

But even his long-time followers don’t often get to see a more personal side of Clayton. To fully know what it takes to become a master trader like him, you have to go behind the curtain to understand that person’s mindset.

We asked Clayton to discuss what drives him to keep reaching for excellence as well as the ideals and beliefs that he values the most.

Name the biggest reason you got into trading.

Clayton: The easiest way to answer that question is actually with one word and it’s, “freedom.” My worldview is built around the idea of innate individual freedom. I think that the markets represent what is supposed to be a true free market and the ability for anyone to participate. The thing I love about the markets, and what I’ve always loved from the get-go, is that it is a true level playing field.

It doesn’t matter if you’re Tyson Clayton or Donald Trump. You could be Vladimir Putin or Warren Buffett. It doesn’t matter who you are. We’re all looking at the same charts, the same prices. We’re looking at the same stocks or same asset classes.

So the only difference is the market information we have and the technology that we use. And with the advances of technology there’s now an abundance of information for us out there. Everybody has access and the ability to get that information nowadays.

I love that it’s a level playing field. That’s kind of what drove me to start trading. Early on in my life, I had a dream and a desire to be rich but I was horrible at school. I hated school, hated it. I was probably the worst high school student ever. It was almost like I just went to school because that’s what you’re supposed to do.

But then when I got out of school, I thought, “You know what? I actually like the world of business, finance and marketing.” And so I was drawn to that field. I realized that if I could learn some chart patterns, then I could make money.

I read some stories about investors who took small amounts of money and had enough time and patience to grow it enormously. I also realized that many of the wealthiest people in the world are extraordinarily smart. They’re very talented in the way that they’ve sustained their wealth, oftentimes by trading and investing in the markets.

So, I said to myself, ”I’m not going to be Bill Gates. I can’t play professional sports. I can’t do what they do. So you know what? I’m gonna learn how to trade and invest.”

Why did you decide to stay in the field of market trading?

Clayton: Once somebody tries this business there are not many people who I know that got out because you have what’s called the “trader seed.” The seed comes from our innate desire for freedom because we understand that this business can lead to freedom and that desire doesn’t ever go away.

And so the reason I stayed is actually sort of illogical. I went through so many pains and struggles and heartaches and drawdowns. I lost a lot of money and got to a point where I didn’t want to do this anymore. For three and a half years, I thought, “Man, I’m horrible at trading. Take this desire away from me. I don’t want it.”

But it never went away. I think the reason it didn’t go away is because, again, it’s built upon my intense desire for freedom. So that’s why I stayed in the business and finally found mentors and people that were willing to show me the ropes.

You can’t do something for as long as I did it and not eventually become pretty good at it. And so just by sheer tenacity, I learned from them and got better at trading.

What would you say is your highest conviction?

Clayton: Accepting Jesus Christ as the Lord and my savior. I believe in the doctrine of predestination and election. My highest conviction is the fact that my life is in the hands of the potter. I live with extraordinary faith because of that belief.

You could say that I’m living by faith. Sometimes the word “faith” can be misconstrued as being like, “Well, he’s just living by hope.” Yes, that’s true. But it’s also through blessings and through experiences in life that you become logically faithful.

And so I based my faith on what is logical but also on what can’t be taught. There are things that are inside of me as a believer that I can’t teach or give to others. But that to me is my highest conviction.

Do you hold any contrarian viewpoints?

Clayton: I am super anti-authoritarian. It just goes back to my desire for freedom. I’m extremely anti-war and I believe strongly in capitalism. I believe in free markets and in private ownership. But it must be voluntary ownership. Many times we as citizens have been forced to own things we don’t want because of unjust laws.

What makes you a person that traders should want to know?

Clayton: I’m very confident in my skills. I know what I know. But I also think one of the big things about me is that I know what I don’t know.

I’m good at a lot of things in the markets. But I don’t need to be the best at everything. I’m not afraid to be wrong. That’s another big thing. I have no respect for pro traders that aren’t willing to put themselves out on a limb and essentially call out specific ideas, not vague statements like “I think the stock market’s going to rally in the next three years.”

I’m talking about sharing specific trade setups like “Buy here, stop here, set a target here.” So I try to get very specific in what I do and the reason why is that it’s really important for me to be who I say I am.

There are a lot of people out there that are not who they say they are. I think that when people spend time with me they’ll realize that they don’t always have to like me. Maybe I have a different style than you, but at least I am who I say I am.

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Can you talk about any other idea or a cause that you’re most strongly for?

Clayton:  I’m strongly for trying to pull out the best in people. I think there’s a balancing act of how much you can give them with charity and then what type of tough love that you need to show them. But I want to see people succeed.

I’m a big fan of underdogs. I’ve always considered myself a little bit of an underdog type of person. I don’t know why. I’ve succeeded at a pretty high level for a lot in my career but I’ve always kind of had this underdog mentality. I like rooting for the underdog.

I look at it the same as when Christ walked the world. He helped the oppressed, the poor, and the sick and that’s who I want to help. If there’s a big party going on, I want to find the lowly ones there and I want to go hang out with them.

Those are the people that I feel more comfortable with. Those are my type of people. So I feel strongly about helping those that need help and that want to help themselves also.

So do you gravitate toward underdog movies like “Rocky” or “Rudy”?

Clayton: I’m a super high-emotion dude for sure. That’s my type of story. So I like underdog movies. I’m inspired by marriages that go through heartaches and then they triumph in the end. I relate to kids and parent relationships that are fractured and then they triumph.

That’s who I am at the core. Those are the things that mean something special to me. Also, marriage and family mean a lot to me obviously.

What things are you strongly against?

Clayton:  I’m opposed to tyranny. There are many things that are disguised as being good or helpful for us that aren’t necessarily good or helpful. I’m also opposed to people not thinking for themselves. I think that we accept things at face value too much.

We don’t stop to consider the deeper meaning for what we’re told to think. There isn’t a hidden agenda to everything in life, but there is more than meets the eye to a lot of things. Some people don’t even stop to think about the real agenda that others are trying to push.

Have you ever had an employer try to get you to do something that you felt was wrong?

Clayton: I had a job in the mortgage industry in 2004 or 2005. I was starting to get better at trading, not great. I was still losing quite a bit of money just to make a little bit.

I was working as a branch manager, making a lot of money and doing really well. We had shattered our sales record for that month. One day, my regional manager contacted me to say, “Great job. Now, we need you to do even better next month.”

And I told him, “I know what I would need to do to sell more. I need to make sure that the appraisers are in my back pocket, which is dishonest. So I can’t do better. This is as good as we can do and still practice good business ethics.”

But my manager said “Well, we still need you to do better.” So I refused his request. I basically wrote a big “Jerry McGuire” mission statement-type of email and sent it to the entire company saying, “I’m gone. I will not compromise my integrity.” 

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