The Tycoon Report

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8. Margaret H (1 year ago) Is this Spam?

   Hi,
   
   
   
   I have subscribed only once before to a investment newsletter but got no value out of it. I don't blame the publication however and have since concluded that the key to success is not trying to figure out which newsletter to subscribe to but rather doing the hard work yourself.
   
   
   
   I have also been a member of a couple of investment clubs. Again this hadn't worked out as well as I had hoped. Again I take responsibility for trying to do it the easy way by hoping to get guidance from others.
   
   
   
   That's history. I have spent the last couple of years educating myself by reading whatever I can from all the established newsletters out there including Tycoon Report.
   
   
   
   Different strokes for different folks. A recommendation that works wonders for one person need not work at all for someone else because everyone's investment profile (capital, time horizon and risk appetite) is different. Only you yourself after due diligence and experimentation will find out what works for YOU and not the newsletter writer or some one else!!!
   
   
   
   Diversification is critical to one's portfolio and herein lies a huge problem. A newsletter basically focuses on a particular style (blue chips, value, emerging market, options etc). Just how many newsletters would one need to subscribe before you can cover the diversification you want?
   
   
   
   Perhaps a new investing club approach should be started whereby members pool their resources and subscribe to an array of newsletters covering the full spectrum to enable members to diversify.
   
   
   
   Margaret Hicks

7. 112224 (1 year ago) Is this Spam?

   Another area of largely missing transpatrecy for investor letters is the "performance" of their recommendations, e.g. return on their recommended picks over the course of the year for ytd and the yearly performance of their picks for the past 10 years or the period of their existance. The Vanguard expert Dan Weiner(FFSHA) shows this for the preceeding 20 years and it is quite revealing to we investors.

6. jester112358 (1 year ago) Is this Spam?

   Hi Dylan,
   
   
   
   As a scientist, I'm very sensitive to the possibility that my own bias could affect the outcome of a scientific experiment. For an financial experiment this is even more of an issue. As you know there is a lot of market manipulation and the large investment banks such as State Street, GS etc. are a major culprit. They often end up holding things like CDOs that they would love to dump on retail investors, pension funds, etc.
   
   
   
   I like to examine the "big picture" i.e. the macro picture and form an investment hypothesis that can be tested and adjusted. Obviously, classical Soros style. His two books "the crisis of global capitalism" and "financial alchemy" are complex intellectual tomes and not for everyone. You won't learn a thing about stock picking from either one. You will learn how the interplay of economic forces, capital flow, political, regulatory and legal issues and open societies are critical to stable global markets. And why the current, monetary value based system is fundamentally unstable. The market is a non-linear unpreditable system where small changes in the input can have dramatic effects on the output. This is why I feel charting is useless except for predicting the past.
   
   
   
   I've quite an experienced investor and would be happy to write a short article on how I would examine the usefulness of a newsletter and which ones I've tried as trial subscription (I never trust one where my credit card is charged up front).
   
   
   
   A newsletter is only useful if it provides information which is not commonly known and thus factored into the price of a stock. This is sometimes known as "inside" information.
   
   
   
   The Motley Fool has some of the most transparent records for their newsletters, where they list gains relative to the S&P. Obviously, including both winners and losers is the key to fair evaluation of the use of a service.
   
   
   
   And you are quite correct. Trust in the advisor is the key issue. I have great respect of Louis Navallier, for example, as his "free" picks (e.g. Slumberger, his pick for 2007 stock of the year) have been some of my best holdings this year).
   
   
   
   Currently, I've been doing some speculation in options based upon what I learned in Chris' course. So far, so good. In previous times I've had a different style. Buy and hold. Examples from the 80s, walmart, pepsi, macdonolds (should have held these even longer). Nineties, pfizer, merke, amgen, biogen, apple, microsoft (held all of these until this year but recently have leveraged a few with deep-in-the-money calls. You can examine my portfolio on the Motley fool under my psudonyme, jester112358, to see my current financial experiment.

5. Dylan (1 year ago) Is this Spam?

   Hey Jester,
   
   
   
   Yeah, 3 days wouldn't do well for small cap/low margin stocks.
   
   As you can see from the Point and Profit disclaimer below (i was on the website and just pulled it) we wait for 30 days before trading any company with a Market Cap below $300 MILLION bucks
   
   
   
   The bottom line is that investors just have to be ULTRA-CAREFUL about who they trust. That's one of the cool things about the Tycoon Report (shameless plug) - we try to give people a comfortable environment to get to know our editors and their investing styles BEFORE purchasing a product. I've found that our readers tend to cross a "comfort threshold" about 3 months after signing up for the Tycoon Report. That's when they tend to try one of our services (even thought we have a full 100% money back guarantee during the first 30 days).
   
   
   
   (Another shameless plug. What can I say? I'm proud of what we do here.)
   
   
   
   Anyway, I notice that you're a very active community member and writer. I'd love to showcase an article of yours in the Tycoon Report.
   
   
   
   Perhaps you can share with our members how to AVOID getting scammed from pump-and-dump people/newsletters, etc. It seems to be a topic you care about and I KNOW it will help our members.
   
   
   
   What do you think? Want to write a fresh article for next weeks Tycoon Report?
   
   
   
   Also: what type of investing experience do you have? Did you just finish a Soros book or have you pondered issues like "reflexivity" for years?
   
   
   
   Cheers!
   
   --DYLAN JOVINE
   
   (PS--It's Tycoon readers like you that keep us motivated here, so please keep speaking your mind. Let us know when we get it right, wrong or ugly!)
   
   
   
   
   
   
   
   "IF EDITOR WRITES ABOUT A STOCK OR SECURITY THAT HE DOES NOT OWN OR BENEFICIALLY OWN, the Editor has agreed not to buy or sell any of the above-listed securities within a minimum period of one trading day after making any new recommendation, or changing their published recommendation, regarding these securities in their Newsletter (calculated from the date the Newsletter featuring such recommendation is first emailed to members, unless the market capitalization of the security at the close of business on that date is less than $300 million (the current Standard and Poors' requirement for inclusion in the S&P SmallCap 600 Index) in which case, the Editor has agreed not to buy or sell such security within a minimum period of thirty trading days before or after the applicable date."

4. jester112358 (1 year ago) Is this Spam?

   Dylan,
   
   
   
   I think your argument regarding the effect of trading restrictions on newsletter writers probably applies to widely traded, high float stocks, but not to small CAPS or options, precisely where inside knowledge or information gives one such an edge and can provide outsize returns. Newsletters in these areas are the most prone to the "self-fulfilling proficy" issue, but are also the most interesting to consider as a subscription (Chris' service, for example) This idea is just a small scale version of George Soros general principal of reflectivity where the market participants actions and opinions influence the outcome of the "financial experiment"

3. Dylan (1 year ago) Is this Spam?

   Hey Jester,
   
   I started Fallen Angel Stocks with the idea that I was simply sharing the research I did for myself (and a few select clients) with the public.
   
   So yes, of course, I eat my own cooking when it comes to the trades I recommend.
   
   A couple of things to add to that:
   
   1) First, none of our editors are allowed to buy or sell ANY SECURITY that they recommended for a period of 3 days BEFORE or 3 DAYS AFTER making the recommendation. This is CRITICAL as it helps eliminate conflicts of interest, which is something everyone in the financial business has to guard against.
   
   2) I happen to be a long-term investor so for me its real easy to wait 3 days afterward to buy a stock I've recommended to FAS members. But if I were doing short-term trading, 3 days may be the difference between winning and losing. I can't speak for other editors but it seems like a rational thought to me.
   
   
   
   As far as your comment about the Gold Rush: You have it all wrong. We don't have to make money either by trading on our own or writing a newsletter. WE DON'T HAVE TO CHOOSE AT ALL - we can make money doing BOTH!
   
   
   
   But you are right on one score: if I thought it would hurt my performance by sharing what I do, I probably would stop sharing, as investing is my bread and butter.
   
   
   
   That's why we're so hard core here at Tycoon about limiting the amount of people we advise in each of our newsletters.
   
   
   
   That limits the amount of money we can make for sure, but there are also things more important then money in life - such as getting a letter from a single mother of two who thanks us for helping pay for her children's college educations.
   
   
   
   Only when you get older do things like that matter most (I couldn't imagine saying this in my early 20's - GOSH I WAS SO SELFISH)!
   
   
   
   Keep up the good writing!
   
   --Dylan Jovine

2. Ethan R (1 year ago) Is this Spam?

   I think some people write newsletters simply because they enjoy writing. We often hear the argument that goes something like, "why does so and so need to sell a newsletter? If they are so good, they could make millions trading stocks."
   
   
   
   But that argument assumes that the writer can not do both. I am a Real Estate investor who has done well, and I also teach a course about investing. I do it for very little money, and I do it because I enjoy teaching others how to prosper. I hope nobody ever thinks "if this guy knows so much, how come he HAS TO teach a course?!"
   
   
   
   Also, I'm also not sure how much of an "edge" one would give up by publishing a newsletter. If you tell 1000 readers to buy a stock, only a certain percentage will take your advice, and the number of shares those persons buy will hardly put a dent into the price over a reasonable period of time.

1. Ken L (1 year ago) Is this Spam?

   Do you really want the newletters editors, and freinds, and associates trading along side you. It depends, is he giving you a head start on his freinds, or did he tell his freinds weeks ago as he wrote up the issue, and their already in and waiting for you to push the price up.
   
   
   
   Some publishers will tell you that they dont allow their editors to trade their own ideas, but that they can trade any other ideas the company publishes. This is what happens when they still have court cases pending over their stock pumping practices.
   
   
   
   I know one newsletter, TradeToBeFree, (can I say that?), he'll tell you when he covers the previous positions if owns certain stocks in his own portfolio.
   
   
   
   As to why someone would publish a newsletter rather than trade. Some people prefer doing the research than the actual trading. Also, theres a huge amount of money in selling financial advice. Just add it up, a thousand subscriptions at 500$ a pop. I know, I've spent more money on trading and investing information than just about anything else, and I'm not a big spender compared to most people. The newsletter and seminar business is a big racket. Plus, it also gives a legitimate business that you can take to the bank for a loan. Try puting down self employed trader on a loan application.
   
   
   
   Other than the ocasional good idea, I prefer services that publish lists and tools that help me to find my own trades. I'm rarely interested in following a service anymore, unless I'm learning something, or its saving me a lot of time and effort. Ditto for most of the expensive trading courses.
   
   
   
   I've found that once you know how to trade most of the information you need is available for free, or else fairly inexpensively.
   
   
   
   Ken

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