Trading Services and Newsletters (Last Update: 1/10/14) Newsletter Survival Guide (December 2013) Part 1, Part 2, and Part 3.
You can check out trading services and newsletters at Investimonials. I've been in a couple of trading services from when I began trading (Dec. 2011) to the present time (Dec. 2012). Newsletters and services I've subscribed to include TimAlerts, FousAlerts, Sang Lucci Trades, Tradinghub, Bulls on Wall Street, Jason Bond Picks, GreatStockPix, The Lincoln List, TopStockPicks, and Investors Underground.
As of 7/27/13, I am subscribed to Jason Bond Picks, TopStockPicks, Bulls on Wall Street, Tradinghub.co, Greatstockpix (lifetime membership), and SuperAlerts. I've added an Amended Comments to the trade services that I've been a long-term (>1 year) member with in order to provide more details on how I feel about them. I'll be giving pros and cons in random order.
As of 1/10/14, I've taken off Jason Bond Picks and TopStockPicks as highly rated newsletters. The only newsletter I would recommend without a shadow of a doubt is Bulls on Wall Street. Kunal is and remains a beast when it comes to day trading. I've seen no one do it better than him and the value you get ($99/month or $80/month for 1/2 year) is well worth the money.
Jason Bond Picks Capital Required: > or < $25,000 Great For: Swing Trading (stocks, mostly long) OR Day Trading (stocks and options, both long and short) Comments: I've been a member since late-April (2012). While you can day trade your heart out (Luke, one of the admins is a day trader for both stocks and options), I prefer to stick with swing trades only. His picks are liquid small caps which is right up my alley. I'm very happy to be a member for this newsletter. The best month I've had was +$19,819 in May (2012).
Amended Comments (10/17/13): When an admin/moderator of a newsletter provides alerts to his/her followers or members, that person should always take into the account the risk factor involved not only to himself, but more importantly to the individuals that will follow in with him. It's true that every individual has the choice to hit the buy button or pass on the alert. However, when you have over 400 individuals looking to play your alert, there will always be that one new trader (much like myself in 2011) that doesn't know any better and just loads the boat whenever or wherever.
If I knew +100 individuals would enter into a trade I announced, my first inclination is to look at the risk factor. If an alert will have massive slippage due to a lack liquidity and a few other variables, it shouldn't be played. In my opinion, with all else equal, the service has began to stray away from this mentality. I'll tackle each issue 1-on-1 and provide an example if possible.
First, illiquidity and slippage. There are +400 members in the room. Let's assume only 10 will buy and each will buy only 1000 shares (10 x 1000 = 10,000). If an alerted stock has 2000 on the current ask, 80% of the incoming volume will not fill at the current ask; there may be as much as a 4-5c slippage. Yes, I understand not everyone will get the same price. However, if it's impossible for 10 people to enter in at the same/near price, you have to wonder if it's a good stock for a room with +400. At the end of the day it's impossible to be able to accommodate everyone, but more liquidity always helps.
Second, poor demonstration of proper position size. (This also ties into the liquidity of a stock.) I understand if an individual wants to go for a big win so they take 20-30K shares on a position. But when you take on that amount with an illiquid stock, it sends a very poor message (to those that know it) regarding proper position size. Under my Trading 101/102 section, I provide an example of a stock that is illiquid and likely to cause slippage with 500 shares bought. It isn't about winning big, but more about how one could lose his or her ass off if it turned out to be a loss.
Third, taking a position in a stock that moves little intraday (i.e. ATR <.15). Yes, I understand not every stock alerted can have an ATR of .25-.50. Sometimes we're playing for a potential squeeze/movement based on positive news and other times it is technical analysis. I can agree with TA. However, news? You cannot bank nor rely on news if the goal of your newsletter is 5-10% in a 2-4 day period. News be damned. I'd rather go after a stock with a big ATR and get 5% on an intraday move rather than sit around like a sniper waiting for news to initiate a pop. This is especially crucial for those with small positions. Those individuals don't have enough to allocate between 2-3 open positions and play the waiting game. They need the hit-and-run alerts.
Fourth, lack-of professionalism (only a specific scenario). For example, how would you react or respond when someone in the chat room goes against your position and publicly announces it? In my opinion, people can do what they want no matter how unpopular it may be. However, from what I've seen (twice), if an individual announces he/she is going against a moderator or fellow member, that person is going to get ragged on heavily. Don't get me wrong as I understand the mentality. Even I feel if you're going to go against the room or a particular person's trade there's no need to announce it; just keep it to yourself. But overreaction is what I witnessed the previous time (June-July 2013) this scenario occurred. To be honest, it was outright bullying. Look, whether it's out of that member's showmanship, ignorance, or whatever, you don't gang up on an individual. Many may laugh and shrug it off towards the end of day, but it sends a poor message. At the end of the day it's about professionalism and taking the high road.
(10/17/13) Fifth, it can turn into a real conservative circlejerk. In the room's defense, out of all the services I've been to, 95% of any politics-related chat skews right or far-right (e.g., "Obama isn't an American citizen.") With that being said, the key to maintaining the objectivity here is to be completely neutral (if possible). But, like other chat rooms that I've been in, once you roll out a pro-conservative comment, the snowball gets rolling and my, oh, my is it irritating. Anytime you've got news related to a POTUS or Congress, be prepared for some ignorance related to, for example, the debt ceiling and budget deficit (as in not knowing the difference between the two).
Bulls on Wall Street (HIGHLY RECOMMENDED) Capital Required: > $25,000 Great For: Day Trading (stocks, long and short) Comments: If you enjoy over a dozen day trade alerts, this is the alert service for you. When I was subscribed, I kept a track of their alerts (stocks only, few swing trades) and it's amazing how they're able to achieve a high win %. Their chat contains about ~100 users. Some users are the more popular and respected traders on Twitter. Great day trading service. Also, a majority of their alerts are small caps from what I've seen with a few large-caps here and there.
Amended Comments (7/28/13): Kunal, owner of BOWS, has a live video feed when he is trading. He'll always call out what he takes verbally, then types it into chat. The only downside about this is he is constantly talking to his friends, handling business on the phone, or doing some misc. task that distracts him from trading. If he would stop doing this, I would have nothing to criticize.
Out of every day trader I've encountered, Kunal is by far the best that I've seen. For avid day traders, BOWS is the only day trading service that stands out a notch above its competitors. If only he'd focus on trading and cut the chatter to a minimum.
A majority of positions he takes are between $2-10, most of them long. The great part is his long alerts are very liquid and move quite a bit. There are no boredom trades. Everything has the potential to be a runner whether it's to the moon or to the basement. You will not be disappointed in what you get from Kunal's service.
Greatstockpix Capital Required: > $25,000 Great For: Day Trading (stocks, mostly long) Comments: GSP's (Mike) entry points are based on stocks that are selling off. He hopes to anticipate the bottom and make an entry at or around that point. Using different MAs and time frames, suggested entries will come with a buy price and .0x to .2x stop depending on the previous candle (check out their website for more information). There is no price range on what stocks will be chosen. As long as the stock is crashing in the morning, it is placed on watch for a potential entry-bounce. If you subscribe to this service, you'll need a lot of patience to study, learn, and wait for a setup. If you're on the winning side of a trade, there is potential to score big, +.50 to +1.50 in a single day. The website tracks all previous winners (though I wish they would track losers as well). Membership cost varies based on what plan you pick.
Amended Comments (7/28/13): As I've mentioned in the original comments, GSP and his team of All-Stars play catching the falling knife trades. If correct, a .10-20 risk can result in a .50-1.00 or more gain. The strategy itself aside there are a few things I'd like to mention:
First, on their results page, they don't post losses. I find this somewhat unacceptable. If you're going to post your success, you need to post your failures as well. Will it end up being a huge list (winners and losers)? Yes, but you've got to be transparent about it. I've also got an issue with the results page including wins from moderators. I feel it should only include wins/losses from the administrator. Just my personal preference.
Second, there's always a quick verbal announcement on a trade idea and the entry/exit is posted in chat. Despite not posting wins and losses on their results page, the chat room is very transparent. Alert-ers will (optional) provide a quick reason as to why the trade idea came to be. Before, you would have to stare at chat. Now you'll know a minute or two ahead of time.
The Lincoln List Capital Required: > $25,000 Great For: Day Trading (stocks, long and short) Comments: A day trading service with about 25-35 people last I checked. He shares his desktop once you're in chat so you know what he's looking at. Not only that, but prior to making an entry, you will receive a buy-stop as well as a stop-loss price. But anything goes with the stock he chooses; long, short, and price ($1-50 or higher). He also has a swing (alerts via e-mail) trade service called Lincoln Million which can be auto-traded. A friendly guy with a nice demeanor. You can try out his day trade service with a 14-day trial.
TopStockPicks Capital Required: < or > $25,000 Great For: Day/Swing Trading (stocks, mostly long) Comments: A great day and/or swing trading service for those with smaller accounts. The focus is on stocks from $.xx to $3. A majority of the time I see alerts for penny stocks. Any trade you see on my Profit.ly under $1 is an alert from this room. The reason why I say it is a day or swing trading room is because an alert can sometimes, though rarely, hit the goal intraday. If you subscribe to this service, be sure to have a broker that doesn't surcharge you on penny stocks.
Amended Comments (7/28/13): The greatest aspect of TSP is the quality of the alerts. When I say quality, my criteria is a great price ($.xx to $1.xx) and a liquid stock (at least 15k shares to move it a penny). TSP continues to be the greatest service out there for investors with smaller accounts looking to swing trade (1-4 day hold time). I also enjoy the looseness of the room. Obviously, you cannot drop the F bomb, but it's loose enough for a damn here-and-there. I've got two dislikes that stand out.
First, too many moderators. It's great to have multiple trade ideas going by on a daily basis, but when I'm chatting with someone or listening to a stream, having a moderator on mic and talking for 10-20 minutes at a random period in time is more of an irritation. The first thing I do when I enter the chat is mute all moderators. I understand if the chatter occurred at lunch hour, but even if it did I still wouldn't want to listen.
Second, sub-penny alerts. Ughhhh. I cannot stand these sub-penny alerts where the goal is a gain of .003 to .005. Again it's just a personal preference.
Third, 1 out of every 5 alerts (non-swing) seem to be via SMS only. In my opinion, alerts should arrive via e-mail and/or chat first. If you're trading, you'll have access to e-mail or the chat. However, some people may not have cellular service for whatever personal reason. Make sure your carrier supports short codes or you won't get them. I know for a fact T-Mobile's GSM doesn't support short codes (as of 8/20/13).
SuperAlerts(NOT FOR NEWBIES) Capital Required: < or > $25,000 Great For: Day/Swing Trading (mostly swing trading, stocks only and mostly long) Comments: I joined Super's service (on Profit.ly) early mid-May 2013. I used the coupon code TIM32 for 30% off the yearly plan ($881.96 or $74 per month after discount). His alerts/specialty are low-float stocks. This means the stock he alerts will have very little volume intraday and be very volatile once the alert is given often with a medium-large spread. After a month, I've made back the cost of the yearly subscription cost and then some. I wouldn't recommend the service to newbies at all.
Amended Comments (8/20/13) If you're able to get an entry near the alert, the payoff potential can be huge. If you're limited on capital or don't want to risk big, take stocks under $10. Currently, as of early-August (2013), Super is on a super-roll with tremendous gains with swing and day trades. At first I hated the room and didn't bother logging in for a month, but it was a good thing I changed my mind and got back into the room for August.
FousAlerts Capital Required: > $25,000 Great For: Mostly Day Trading with some Swings, your preference (stocks only, mostly long) Comments: I was with Fous's service before he joined Profit.ly. Though he's active in day trading (small caps), I would still give the nod of trading small caps to Bulls on Wall Street. Fous's basic service on Profit.ly is $99/month and has about 30-35 people in chat including moderators. A bit too quiet for my taste. (I won't be renewing my subscription. It was more of a curiosity thing to see what his room is like now.