144: Learn an arbitrage strategy used by professional stock traders w/ Tim Steenstrup

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Since 2013, Tim Steenstrup has been a cross-border arbitrage trader at Conventus Capital. Though markets have been a part of his life going back to 1994; Tim’s been part of a brokerage firm in Japan, a hedge fund—which was featured in The Big Short movie, and a prominent New York trading firm.

As you’ll soon hear, we skim through Tim’s backstory and then spend a large part of this episode going into the mechanics of how a cross-border arbitrage strategy works. Tim does highlight, this strategy may be difficult to implement as a retail trader, but regardless, I think it’s valuable for you to hear about the various approaches of how professional traders trade…

Topics of discussion:

  • Tim speaks about his attraction to risk taking, abandoning a would-be law career for a brokerage position, and becoming a trader—someone who calls the shots.
  • The mechanics of cross-border arbitrage strategies; the three transactions which must occur, the inherent high risk, measuring moves and actual trade examples.
  • How Tim’s gotten better at accepting losses and recovering, a reminder to take the bad with the good, and respecting how quickly the market can beat you.
  • An overview of how Tim performs company research, and how he’s evolving to make the most of times when markets are out of favor with his main strategy.

Links and resources mentioned:

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