Samantha LaDuc on how she became a “macro-to-micro” trader

Just before the worst economic downturn since the 1930s, Samantha LaDuc had started out trading.

Driven by an urge to have a more flexible work and home life balance, her first foray into the markets came three days after investment bank Lehman Brothers collapsed on the 15 September 2008.

It was a tough time for any investor let alone a new trader, but LaDuc found early success. She learned quickly how to short stocks and made 450% within six months.

Since then, she has developed a deeper interest in understanding why a stock, index, or asset is moving so as to anticipate, rather than just react to, inflection points. That’s how LaDuc came to employ big picture thinking for her technical set-ups and led to her coining the phrase "macro-to-micro" analysis for her approach.

LaDuc has developed a strategy that is heavily centred on volatility and risk-defined options for trade execution but against a macro, value, sentiment, intermarket and technical analysis backdrop. She actively trades across multiple time frames, from hours to months, and supports clients who do the same.

Based near Boston, Massachusetts, she runs a live trading room and offers her research and analysis via her platform, LaDuc Trading.

Through brokerage-triggered trade alerts she informs her active retail and institutional clients of every trade, in addition to offering allocated trading for Institutional (RIA/HF/PM) clients.

This transparency is important to LaDuc, as it doesn’t allow her to cherry pick only the good ideas. “You get to see the good, the bad and the ugly – it’s all there - and also the rationale behind it,” she tells Opto.

Here’s a look at LaDuc’s typical trading day.

Before the markets open: scanning the gamut of financial news

LaDuc starts her day by reviewing market movements across all asset classes, usually over a cup of tea and with her cat, Stella, curled up on her lap.
 
“I want to know everything I possibly can about what’s happened during the overnight session. I'm looking for news that might be market moving as well as any stocks of interest that I have on my radar,” she explains.

“I'm looking for news that might be market moving as well as any stocks of interest that I have on my radar”

Early trading: determining whether to chase, swing or trend

From 9:00am to 12:00pm, LaDuc is in full trading mode and clients get to see and hear what she is interested in and why.

To ensure she’s getting the full picture from different perspectives, LaDuc will also have several different charting platforms that will do different jobs. StockCharts, for instance, doesn’t provide real-time data like TC2000 or Thinkorswim, but does allow her to build in her intermarket analysis studies.

Armed with a directional trading strategy and a focus for trading options on equities LaDuc moves between three primary time frames when trading. She spends about 25% of her time on chase trades for example, which can go on for on to three days. A swing takes up the bulk of her attention and will last one to three weeks, while trends make up 25% of her book and last one to three months.

“I'm basing my entry on an expectation of volatility, moving it one way or the other. It is not playing the fate of decay, like option sellers, it is timing a directional move,” LaDuc says.

Indeed, when she is placing a position on a trade, it comes down to three things: volatility, direction and time.

“I'm basing my entry on an expectation of volatility ... It is not playing the fate of decay, like option sellers, it is timing a directional move"

“I am absolutely a volatility trader, so I want volatility to enter that instrument, which is then going to determine the direction. Regardless of the time frame, chase, swing or trend, the same logic applies,” she explains.

Afternoon trading and after the markets close: setting up the fishing plan

After lunch, LaDuc is back in the markets where she will continue analyzing, trading and writing. This will include her Market Catch series as well as updates to her client’s “fishing plan”, which she uses to journal her trades.

Through this daily routine, she sets up a plan for the week that indicates her “weather forecasts” as well as potential storms or risks. “I always look at risks before I look at opportunities,” she explains.

At the end of the day, LaDuc operates under one mantra: “don’t risk anything you’re not willing to lose”.