Stock Market Scams

photo by azrainamn
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In these trouble times of the stock market no one is really sure what stock is going to break out and post some beautiful gains. Of course there are many out there that will offer you their services. I’m here to tell you, beware of wolves on sheep’s clothing.
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When you go ahead and type “stock market” or anything similar to that in Google search, you will get several million returned pages. The results are astounding as to the different types of sites you will find. many of them are site designed to get you to buy into their program or at least to leave your e-mail.
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The one and only purpose to these site are to make money off of you not to help you make money in the stock market. In some cases you will find that they offer you “tips” after you subscribe to their service. Sometimes it’s a monthly service, but mainly it’s by the year. The reason why many of them don’t do it by the month is because after the first or second month you would cancel once you see that you’re not making gains in your portfolio.
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The other way these sites will make money off of you is a little more shady that the other. These are the sites that will go ahead and say that they will send you daily notices for no charge. You only have to give them your e-mail. The way that they make money is that they will send you “tips” on stocks that they are already in or that they’ve just recently pumped up. Showing you graphs and charts showing that the stock is at the break out point. What they don’t tell you is that they are the ones pumping it.
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If enough people jump into the stock it will cause the price to rise, at which point they start dumping their position leaving you and others hold the bag.
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There is one stock right now that I’ve been watching because of one of these services. I learned about it through Twitter. I will not disclose the person or the stock for obvious reasons, but I will tell the rest. The person posts on Twitter the the particular stock has moved X amount on X amount of volume. This stock jumped 66% that day, the next day it jumped 125%. In the last week it dropped 95%. With these moves the stock now sit 56% below from where the person started hyping it.
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Just in case you were wondering what type of stock has movements that big in percentage. Penny stocks move like that all the time. That is why you shouldn’t invest more than 10% of your portfolio to penny stocks. You can lose all that you invest in these kinds of plays.
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To make matters worse, the Bid price never rose above the starting price until two days ago where it went to the height of the hype just long enough for one entity to dump several thousand shares. That is also why the stock is now down more than it was in the beginning.
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In the mist of all these types of people out there, there are those that are legitimate and very helpful. The only one that I would at this time recommend is Jim Cramer from TheStreet.com

Because of who he is and the influence that he has, he is not allowed to invest in the stock market himself. Instead he has a portfolio that the money goes to charity. We have an affiliate program with him that offers you a free
two week trial. I suggest that you give it a try. What the heck, it’s free.

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