Stock Trading Tips

On a constant basis, we are constantly bombarded by “stock trading tips”, in emails, by regular mail, and in many other forms of print. We’ve all seen those nice glossy newsletters in our mailbox proclaiming the next hot stock that is “Going to Quadruple Your Money in Only Six Weeks”, and other similar ridiculous claims. Most of these stock trading tips are worthless and will only end up causing you to lose money or break even at best. But, how do you determine if these stock market trading tips that are being freely given have any real value or not?

Luckily, there are a few basic guidelines you can follow that will help you to determine if these tips are going to have a likely chance of improving the value of your stock trading portfolio. Follow these few simple guidelines listed here and you’ll be able to eliminate most, if not all of the “stock trading tips” you receive.

Guidelines to Determine Whether Stock Trading Tips Have Real Value

1) Who is paying to have these tips delivered? A lot of what you receive are simply paid advertisements. Look closely at the bottom of the last page. By law, if a company has been paid to promote a stock, they must state this fact. And usually it is in small print at the bottom or end of the document. If it says they were paid to promote the endorsed company, you can usually bet that you will NOT “get paid” by investing in it.

2) Check the recent volume of the underlying stock tip. If there was significantly higher recent volume surges before the stock tip was sent out, you can usually rest assured that someone (the people providing the stock tip) have already purchased this stock and hope to make a profit when those that receive their “tips” purchase this same stock from them at an elevated price due to the frenzied buying of their duped targets (you).

3) Search for recent information and news on the recommended tip. If you can’t find out anything about the “great” company they are recommending, then you should strongly consider staying far away from it.

4) Do the providers of these stock trading tips make statements like “largest off-shore oil find ever” or “so profitable they don’t know what to do with all the extra cash”? If so, you should be able to research these stocks and find at least something that backs up these outlandish claims. If not, well, then once again it is probable that you are being misled.

So next time you receive yet another hot stock tip, simply follow the above guidelines to help determine the validity of the investment. You will find that a large proportion of all the free stock tips you receive will meet one of the guidelines above.

Remember, these stock market tips are being given to you for “free”, and more than likely you’re getting what you paid for.

Buyer beware!