How these SMS & so called free stock tips work?

I would contact a broker who holds demat accounts of the clients. I asked for their database of clients at a very minimal price. yes! your demat account details are for sale (although not all broker are involved). There are so many fraud SMS stock tips available in the market who are misguiding the innocent people.

Let’s take an example that I will get a database of 10000 such accounts who are active trader/investors. I will divide these traders into 2 groups. Let’s call them Group A and Group B. both have an equal base of 5000 each. I will then send them an SMS about the certain stock.

Here I play a trick. I will send a tip “BUY” to group A and “SELL” to group B. One of them will be surely true. I will continue sending SMS for a month. At the end of the month, one group is a winning group and another is losing. I will discard the losing group.

Again I will do the same trick. I will divide the base of 5000 into 2 groups of 2500 each and send “BUY” and “SELL” tip to them.

flow chart

 

Now, these 156 customers would think that I am a magician of trading because of my free and Sureshot tips, they have made a huge profit. I will somehow convince them to join my paid service for some monthly/yearly subscription. Let’s say I will charge them 10000/year for providing stock market tips.

Most of them will join me as I have helped them earn the decent profit so they started to believe me.

10000 X 156 = 1560000. That’s a huge money I will make at least for a year and that too without any initial capital investment.

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I will then repeat the same cycle again and again. This is how SMS & free tips game works.

There are many tip providers in real life who claim to give you 90-95% accurate tips with the free 1-week trial, If you are getting a lot of right tips, you might be that lucky small group which is their “TARGET” as seen above in the chart. Don’t fall prey to these stock scams. Beware!

If these so-called tips providers were so good then instead of giving tips they would be making millions for themselves.

So never ever trade on tips given by people who give it for free, they may say they have given good advice in the past but even a monkey can be right half of the times , so it doesn’t means you are going to trade on the advice of a monkey.

 

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