Browsing articles from "April, 2014"

Weekly Roundup: Our Gurus’ Best Trades

Apr 7, 2014   //   by Profitly   //   Best Trades, Profitly  //  Comments Off on Weekly Roundup: Our Gurus’ Best Trades

Welcome to the first weekly roundup of guru trades on Profitly! Now it will be easier than ever to see the big trades that gurus Sykes, Superman, and InvestorsLive are executing on a weekly basis. We’ll include both the wins and the losses, since Profitly is all about be fair and transparent.

Each week we will start with the guru that was the most profitable, and this past week it appears that Superman takes that spot. We aren’t going to write about every single trade in this post, since that would be extremely boring. We are just going to cover the big, exciting trades that you all want to learn from.

Alright, so let’s talk about the super hero guru on Profitly who is up $124,360.33 in the past 30 days. (

Starting out with a bang, we have a $46,674 profit on WATT ( Superman posts notes on many of his trades so you can get an idea of how he decided when to get in or get out of a position. Superman bought 10,240 shares at $8.75 on the Friday before this week and sold them on Monday at $13.32, which is a 52% increase in share price! He definitely earned his name with this one.

Screen Shot 2014-04-06 at [Apr 6] 11.35.07 AM

Next we have a $6,025 profit on ATRM. ( Entry comments: DO NOT CHASE LOW FLOAT HUGE SPREAD – history of runs, did odd acquisition but no immediate shares……personal stop loss 5 area personal target 6-8 if it works….small position. Exit comments: SUPER TRADE! He bought 3,500 shares at $5.55 and sold at $7.27 for a 31% gain, boom!

Screen Shot 2014-04-06 at 12.35.07 PM

Lastly, we have a loss. ( This is a trade he has been holding on to since the middle of March though, so it’s not like the loss was just based this week. It was just realized this week since he exited the position. This was a $9,400 loss on OBCI. Entry comments: SWING – personal stop loss 3 area ….personal target 4-6 plus if it works ..they said last year new product that kills all germs launched in Q1 or Q2 Aug 14 PR – Peter Dornau concluded, saying, “We are in the final stages of development of packaging of our new Performacid products. We have started initial presentations to several national chain retailers. As previously announced, we are on schedule for a first or second quarter 2014 full product launch.” Exit comments: out for loss for now will keep on watch I wanted more bullish statements from mgmt.. He bought 20,000 shares at $3.37 and sold them at $2.90.

Screen Shot 2014-04-06 at 12.30.57 PM

Second we have Tim, who also had a fantastic week and is up $44,812.23 over the past 30 days, according to Profitly. (

Earlier in the week he banked a profit of $6,236 on PSID ( Tim posts entry and exit comments on each of his trades as well, so here are some notes that are extremely helpful and can help you learn how he decided when to get in and out of a trade: Entry comments: Buying this as it’s chipped away a big seller at .085 on news of a contract with US government contract, read press release sketchy company, but it might really run if people read this news, good risk/reward, goal is to sell in the .10-.12 range, nothing huge but not much downside either. Exit comments: Sold for quick $5k+ profit due to this ridiculous villa not having great internet same type of problem as the $12 million yacht when we found EKSO, funny how these luxuries can’t have good wifi, this might still run but I wanna teach you to take profits when your trading environment isn’t ideal. He got in at $0.085 with 350,000 shares and out at $0.103. That’s more than a 20% move and he did this trade in one day!

Screen Shot 2014-04-06 at 4.19.07 PM

Second we have Tim’s big loss of the week. He took a $3,865 hit on YOD. ( Entry comments: Bought some ahead of earnings. Too many potentially exciting announcements possible later today after market close. It is definitely a risk, but the reward outweighs the risks, especially given the 30% drop off the highs. EXTREMELY SMALL POSITION GIVEN INABILITY TO CUT LOSSES QUICKLY. Goal is 6s or the 7s. This is true gambling as I will be flying during this trade. Exit comments: Cutting losses quickly as best I can from the airport. I broke my own rules about guessing on earnings and paid the price. Great video lesson coming. Tim bought 6000 shares at $4.86 and sold them at $4.21.

Screen Shot 2014-04-06 at 4.19.16 PM

Third we have his best trade of the week. ( Tim made $7,147 on VEND. Entry comments: Surprising earnings winner, PR says high est sales ever in March and 30%+ year over year growth, I don’t believe them, but the stock has gotten crushed and no real resistance until 5ish so I’ll dip buy, the beauty of pumps, they can bounce nicely too! Goal is to sell in the low to mid 4s later today and tomorrow. Exit comments: Got a little gap up/morning spike, but wall of sellers at 4.30ish, no thanks, got the 50 cents/share of upside I wanted, taking safe profits, good trade! Tim bought 24,023 shares at $4.94 and sold the next day at $4.24.

Screen Shot 2014-04-06 at 4.20.27 PM

Lastly we have another big win on WATT. Tim made $4,357 on this trade. ( Entry comments: Buying for end of the day spike/morning gap up/spike, this has gapped/spiked in the morning roughly $1/share every day, key breakout level is $15 so even if it only spikes 50 cents/share, it’ll be a breakout and should squeeze some shorts…even if it tops at 15 I have some decent 40 cents/share profits, GREAT risk/reward buying here, don’t chase it though, it moves quick, goal is to sell into a 50-75 cent/share spike. Exit comments: Sold PERFECTLY INTO MORNING GAP UP…trade couldn’t have gone any better…video lesson documenting the whole thing coming, this still might run, but there are big sellers everywhere so I’m taking profits and lockin it in safelyyyyyy, congrats everyone. He bought 12,000 shares at $14.62 and sold them the next day at $14.98.

Screen Shot 2014-04-06 at 4.20.15 PM

We’ll round it out with a great week from InvestorsLive as well. This guy is up a total of $112,005.65 over the last 30 days, according to Profitly. NICE!

First we have a $7,852 profit on PLUG. ( This was a one day trade as well. Nathan shorted 20,000 shares of PLUG on April 4 at $7.552 and closed his position at $7.15 later that day. Remember, when you short a stock, you want the price of the stock to go lower.

Screen Shot 2014-04-06 at 4.20.39 PM

Second we have a $3,001 profit on PLUG that day before. ( This was also a short sell. He shorted 31,900 shares of PLUG at $7.84 and closed his position at $7.74.

Screen Shot 2014-04-06 at 4.20.52 PM

Third we have a $1,819 profit on GNK ( This was yet another trade betting on the fall in the price of the stock. Nathan shorted 5,000 shares at $2.65 and bought them back at $2.28.

Screen Shot 2014-04-06 at 4.21.50 PM

Fourth we have a $2,229 profit in BIOF. ( Nathan bought 10,200 shares of this stock at $6.50 and sold them at $6.72.

Screen Shot 2014-04-06 at 4.21.42 PM

Lastly, we have Nathan’s only big loss for the week. ( WIN wasn’t such a winner for him, taking a $1,780 loss. Nathan bought this stock at $8.68 and sold it at $8.51. Too bad he didn’t short it like the rest of his great trades for the week. Oh well, still a great week where he earned more than the majority of people do in a month! Not bad!

Screen Shot 2014-04-06 at 4.21.33 PM


HFT – What is it? Why it doesn’t matter!

Apr 4, 2014   //   by Profitly   //   Profitly  //  Comments Off on HFT – What is it? Why it doesn’t matter!


It’s the phrase that has been said more in the past week than in the rest of history combined, “high-frequency trading.” This seemingly unknown tactic has been around for several years, but it took a bestselling author such as Michael Lewis to write about it for it to get noticed. And seeing that some of Lewis’ previous novels have turned into movies, (see: Blind Side) perhaps “Flash Boys” will hit the big screen some day as well.

“Flash Boys,” as the book is called, was released this past Monday and came roaring out of the gate thanks to a headline grabbing 60 Minutes interview where Lewis claims the stock market is “rigged.” It gained even more attention after it was reported that the SEC and FBI are looking into HFT and there was this heated debate on CNBC (

So what exactly is high-frequency trading? It’s very fast, computerized trading in the stock market used to get an advantage. Investopedia gives a in-depth definition as well as a laid out example:

A program trading platform that uses powerful computers to transact a large number of orders at very fast speeds. High-frequency trading uses complex algorithms to analyze multiple markets and execute orders based on market conditions. Typically, the traders with the fastest execution speeds will be more profitable than traders with slower execution speeds. As of 2009, it is estimated more than 50% of exchange volume comes from high-frequency trading orders.

High-frequency trading became most popular when exchanges began to offer incentives for companies to add liquidity to the market. For instance, the New York Stock Exchange has a group of liquidity providers called supplemental liquidly providers (SLPs), which attempt to add competition and liquidity for existing quotes on the exchange. As an incentive to the firm, the NYSE pays a fee or rebate for providing said liquidity. As of 2009, the SLP rebate was $0.0015. Multiply that by millions of transactions per day and you can see where part of the profits for high frequency trading comes from.

Lewis says in an interview on the Daily Show that stock exchanges in the United States sell the right to advance information to high-frequency traders. It gives them a couple of milliseconds of an advantage, and that’s enough to add up to billions of dollars over an extended period. “It’s an unnecessary Wall Street intermediation,” Lewis adds.

How exactly did we get here? Basically, the computers won. We used to use manual markets with trading floors and people, but now we have moved on to automated. The process has been going on for roughly the last 10-15 years. Now, there’s an algorithm for a pension fund for it to place its orders rather than a broker who would spend all day slowly buying 100,000 shares.

So now, what are the cases for and against this whole process? First let’s start with the pros. HFT has essentially made it so we don’t have to pay as much in commission when we buy or sell a stock. HFT will never cause you to pay more than an extra penny a share, so in the grand scheme of things it isn’t costing you a lot of money in terms of raising the cost of the stock you are trying to buy. Now on to the cons of HFT. Basically, this makes it possible that the markets are more fragile than they were before, since it’s all computers talking to each other and the quality control isn’t always there. Remember the “Flash Crash?” Lewis has said that we could see something even worse than the Flash Crash if we don’t do something about HFT, and he may be right.

Does it impact Tim and the other gurus? Not really. “HFT trade big-time stocks, I trade penny stocks, as I’ve said many times before my niche is like playing midgets in basketball, I don’t want to go one on one with Michael Jordan or worse some robotic all-star (to complete the HFT basketball analogy),” Tim said.

And is there anything that can be done about it? Well, Felix Salmon states in his Reuters article that Michael Lewis would like to see something done about it and welcomes the way in which the FBI and the New York attorney general are launching investigations into HFT. But Salmon says his feeling is that “if you want prosecutions, then law-enforcement should launch investigations — but that if you really want to fix things, then creating a highly adversarial relationship between HFT shops and the government is not going to help and is in fact almost certain to hurt,” and he has a point. The SEC had been looking at HFT since at least last year, and the firestorm that this book has set of may have simply done more harm than good by creating this conflicted relationship. Do you really think they will cooperate with each other now?

The Activist’s Strategy

Apr 2, 2014   //   by Profitly   //   Market, News  //  Comments Off on The Activist’s Strategy

Activist investors have been popping up in the news a lot lately. Not only for targeting massive companies like Apple, but because guys like Larry Fink, the head of Blackrock, are speaking out against them. Learning about all types of investment styles and watching guys like the ones we’ll discuss in this post will help you learn to trade and become more profitable. One saying we love on this blog is “Knowledge is power,” embrace it and learn, learn, learn!

First, let’s make sure everyone knows what an activist investor is. According to Investopedia, and activist investor or shareholder is:

“An individual or group that purchases large numbers of a public company’s shares and/or tries to obtain seats on the company’s board with the goal of effecting a major change in the company. A company can become a target for activist investors if it is mismanaged, has excessive costs, could be run more profitably as a private company or has another problem that the activist investor believes it can fix to make the company more valuable. Private equity firms, hedge funds and wealthy individuals are types of entities that might decide to act as activist investors.”

Now that you know what they do, let’s talk about three of the most notable activist investors.

(All images via


First we have Carl Icahn. “Uncle Carl” as they call him has attempted to make major changes at Yahoo!, Blockbuster, Time Warner and RJR Nabisco, among other companies. As of late, he has target Apple and eBay. As of this month, he is estimated to have a net worth close to $25 billion, according to Forbes. Yes, that’s billion, not million.

His business philosophy focuses on targeting a business that he believes is badly managed and whose stock price is under-valued. He’ll then secure a large ownership position to gain entrance for a position on the company’s board of directors. Not all activist investors work that way, and we’ll learn more about them later. Wall Street experts say that most of the time he is triumphant, since he is frightening and unyielding. He has been viewed as such a dependable gold mine that investment managers will buy the company’s shares, and whether Icahn is victorious or not, he does leave with vigorous stock price profits.

Carl has had his hand in almost every major story in corporate America over the last year, from battling with Michael Dell, making a killer trade on Netflix, continuing to fight with William Ackman over Herbalife, to lobbying for Apple to repurchase more of its stock. Shares of his publicly-trade Icahn Enterprises have climbed by more than 50% in the last year according to Forbes. Icahn’s investment fund returned 31% in 2013. Icahn’s brand of activist investing is as popular as ever. In August of last year he took to Twitter, setting both the Web and Wall Street on fire by announcing that he had acquired a large stake in Apple.


Next up we have William Ackman, or Bill Ackman. Even though it doesn’t come close to Uncle Carl’s, Bill’s wealth is nothing to frown upon at $1.5 billion. Ackman is the Founder and CEO of Pershing Square Capital Management. At age 47, it’s unlikely this guy will be going away anytime soon, even if he has had a tough couple of years. Despite one of the biggest rallies in history, his hedge fund’s performance has been anything but impressive, up a measly 9.7% net of fees in 2013, while the market was up roughly 30%. The fund was weighed down last year by one of Ackman’s most recent targets: Herbalife, the nutritional supplements company. Bill has been shorting the stock and continues to believe it is a “pyramid scheme.” Shares of Herbalife were up nearly 140% in 2013, ouch Bill!


Finally, we have Daniel Loeb. His net worth falls in between or prior activists at $2.2 Billion. Loeb is the 52-year-old Founder of Third Point, a hedge fund that manages roughly $14 billion according to Forbes. All three of our activists were playing Herbalife as some point. Loeb sided with Carl Icahn and bet on the stock’s rise for a short period of time. He sold at a profit. Another company that has been one of his targets is Yahoo, where he played a large role in a change on the board before getting out of his position with a large profit. Loeb’s flagship hedge fund posted net returns of 25% in 2013, better than Ackman but still trailing the market. In their defense, many hedge funds underperformed last year.