Free trades and biases to make you use them

Free Trades

It looks like there’s a new trend developing in the costs of placing stock trades. A company called Zecco offers 40 free stock trades per month with a minimum balance of $2,500. Bank of America is doing something similar, but has a minimum balance requirement of $25,000. So it looks like this trend might be gathering some steam.

Know Your Enemy…You

I recently read a book called “Way of the Turtle”. I thought it was quite good and would recommend it to any one looking to invest in the stock market. The author describes his time as one of a group of traders that were trained to use a certain trading methodology. This in and of itself is interesting.

The then author goes on to describe some of the things they learned like the biases that we have as humans. These biases have served us well in the past for survival, but actually get in the way in an investing situation. One example would be the herd effect. In nature the animal that doesn’t run when the rest of the herd runs is normally the one that gets eaten. But in investing the investor that follows everyone else is usually the one that is left holding the bag at the top of the bubble.

Van Tharp has an excerpt from the book in his latest newsletter . I highly recommend reading it so you can recognize these biases in your own investing and counter them before they lead you to get eaten.

Inflatable Dividends

On Friday the price of the 75% discount for this service will be going away and the regular price of $19.95/month will go into effect for all new subscribers. Congratulations to all those who have locked in their subscription costs at the current discounted price. Please hurry if you intend to do the same. We’ve received numerous compliments on how useful the service is for pointing out safe dividend capture trades.

Inflatable Dividends Real Time Example Trades

There’s not much change this week as far as we are concerned. Neither stock paid a dividend this week, so it is very unlikely that we got exercised on our calls. And both stocks are still above our stop losses. ALSK has not gone below $14.45 and AEE has not gone below $44.31.

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