Daytrading (Daytrader) Stock Chatrooms - How To Find the Best Rooms and Avoid the Worst
Daytrading chat rooms run the full spectrum from either really, really bad to really insightful and helpful (and profitable). There are chat rooms out there that are nothing but rip-offs, specifically designed to absorb as much money from you as possible before you quit in disgust. And there are chat rooms that are worth every penny and will make you a much better trader.
The question is, how do you figure out which chat rooms are good and which ones are not so good? Here are some tips:
1. Utilize their free trial offers. If a chat room doesn't offer a free trial, then don't sign up, simple as that. Most chat rooms are too expensive to join for a month just to test. If they don't offer a free trial on their site, then email them and request one. Don't give up your credit card information either. Tell them that you are interested but want to take a two week test of the site first. Any reputable site will have no problem offering you a trial.
2. Research. Type the name of the chat room into Google and see what kinds of hits that you get. Head over to elitetrader.com and do a search there as well. You'll get a pretty quick idea as to whether or not the service is reputable and worth the money.
3. Ask for a track record. Some sites will just post their winners on their front page, and spend pages of copy endlessly boasting about their winners. What about their losers? Ask for a full recap of all their trades from the past 2-3 months. If they don't offer this to you, move on to the next site.
4. Email / Talk to the owner of the site. Shoot them off an email. Ask any questions that you might have. Are the responses helpful or are they just canned? Are they telling you to just join up and you'll receive the answers to your questions then? Are they going to try and sell more products to you once you sign up? What exactly will your monthly membership fee cover? They should provide quick and helpful responses to these questions. If they don't, don't sign up. Ask for a bio of the lead trader in the chat room. If they are successful, why are they leading a chat room and not just trading? You would be surprised how many of these operators generate almost all of their income from operating the chat room and hardly anything from actually trading stocks.
5. Refund policy. What kind of a refund policy does the room have? If you join and find the service doesn't help you after a few days, can you cancel and get your money refunded? A reputable chat room will have a fair refund policy. You can't expect a refund after being in the service for three weeks, but if you cancel after a couple of days, you should be entitled to a refund.
6. The SEC. Your last step should be to do a quick search on sec.gov. Does the site pop up in any regulatory filings? You would be surprised that at least a handful have been sanctioned in the past but are still operating.
7. Does the site seem to be interested in teaching you, or do they just expect their subscribers to follow their picks like sheep? You want a chat room leader that will be able to explain the trades that he does, and not just blurt out positions. A chat room should be a learning tool first, and a money-making tool second.
Chat rooms can be a very valuable tool. There are a few gems out there, and plenty of scams. If you follow these steps you will be on the road towards finding that gem that will help you in your trading career.
Filed under: Stock Market Education | General Knowledge | Daytrading