$7,500 into $8 million

[Spekulatius]

I think too that his system may work, or at least has worked. I listened to a few of Sykes videos on YouTube.

 

He watches penny stock in hot sectors. He buys the laggards not the leaders after the leaders have run already.  He looks for signs that they are manipulated and looks for the early signs that they might pop. He sells into the spike and trades the technicals or based on his hunch. He might short on the way down when the spike has played out.

 

So not scalable. He can probably put a few hundred thousands of work at most. His gains are probably only a few thousands maybe ten thousands. He rinses and repeats this many times over.

 

Once you make a few millions, this becomes tedious work , it’s mentally exhausting and I think that’s why he went from this trading to teaching how to trade. If @Gregmal says he is legit, then I believe it - he has no reason to lie about this. And I absolutely think that a trader in this inefficient corner of the market can make money somewhat consistent.

 

What Jack Kellogg is doing (from the first article) seems to be different though.

[formthirteen]

To me, this explains it all: https://timsykeswatchlist.com/

 

Quote

Get The HOTTEST Penny Stocks Delivered To Your Inbox Each Week

 

There's nothing special, other than the profitability, about this variation of a pump n' dump, but I probably need to take his course to know for sure

 

Quote

Every week (at no charge), you’ll get an email with 3 stocks I personally have my eye on.

I’ve studied thoroughly each company I put on the list.

Edited June 3, 2023 by formthirteen

[Spekulatius]

6 hours ago, formthirteen said:

To me, this explains it all: https://timsykeswatchlist.com/

 

 

There's nothing special, other than the profitability, about this variation of a pump n' dump, but I probably need to take his course to know for sure

 

Well, it may work for him, but not his subscribers. After all, these penny stocks are worse than a zero sum game in total, if someone makes money, so somebody else needs to lose it.

Edited June 3, 2023 by Spekulatius

[Gregmal]

You watch and keep monitoring lists of stocks that move. Typically manipulated ones or promotion campaigns. The volatility is how you make the money. In this case, you WANT to seek out stocks you know there’s funny business going on. They are very predictable depending upon what phase of the promotion they are in.
 

The problem is that it, like all other money making ventures, actually requires a lot of work to do successfully. You have to constantly keep up to date on this because they’re all shitcos. So whereas with MSG, I put in a ton of work and then over time have a fairly high level understanding with almost zero future work put in, this sort of trading strategy you constantly have to be grinding it out. It’s tedious for sure. 

But for example, the model in a simplified way is to watch volume on thinly traded shitcos. Flag stuff with abnormally high volume…this is generally where a stock promoter or pump and dumper is buying. It’s clear as day when you find it. Then after finding those stocks, monitor internet traffic and message boards. If there’s going to be a promotion, that’s generally where they begin once you find activity. You wanna look for mailing list campaigns and associated entities. Often within these campaigns you can confirm what you saw on the tape with the volume. In small disclaimers with tiny print many will tell you(because they have to) “we own 550,000 shares of xyz and reserve the right to sell at any time” or “we have received $100,000 in exchange for a 6 month investor relations contract”… that type of stuff. Then once you confirm that stuff you just have to be aware of what stage the campaign is in. Early on you wanna be long. Mid phase you play both sides. Once it’s over you short all day. 

[formthirteen]

@Gregmal thank you for explaining this in detail. It would be interesting to try, just for the fun of doing something new, but it would certainly end in pain and a loss of $7,500.

[Guest]

Ever done this type of trading, Greg? 

[Gregmal]

7 minutes ago, stahleyp said:

Ever done this type of trading, Greg? 

I looked at what Sykes does a long time ago but it’s definitely not something you can even sniff doing if you operate in the capacity of a “financial professional” which I was just starting off as. When one says, why would he disclose it if it’s profitable, well, name me a registered 24/compliance guy who is going to sign off on buying pink sheeters and stuff trading for 37 cents? Not happening. But at its core, it’s just refined momentum trading. He’s front running stock promotions. Stock promotions have distinct phases. They all have the same life cycle. But it’s not fundamentally different than what Kuppy does when he says he’s got no problem buying Ponzi schemes and shitcos. Your trade is basically predicting behavior. When the retail schmuck gets the new email about the next can’t miss get rich quick stock, what do you think he does? When he does what he does, what do you think the promoter does? Or the insiders? Follow the incentives and you find the pot of gold. It’s just the dirtiest form where you have to use speciality brokers who let you short stuff trading at .00065 and you don’t mind swinging long on something that’s overvalued or shorting something that isn’t moving on fundamentals.

[Gregmal]

Here is one I know he was all over in 2012 and it was liquid enough for me to make a ton of money on. 
 

Note the disclaimers and the reduction in shares of BVSN as the next campaign started(SYNC). BVSN started at $5 and went to $60 then back to $7 with massive volatility and SYNC $8 to $15 to $3. 
 

Edited June 3, 2023 by Gregmal

[Guest]

Thanks, Greg. Your insight is appreciated as always! 

[brobro777]

Sometimes the stock gets pumped so hard, trading gets halted (https://www.marketwatch.com/amp/story/abatix-halted-nasdaq-asks-for-additional-information)

 

When the trading resumes (https://ir.nasdaq.com/static-files/ca0dace5-e2f8-4acf-a92e-422920b547e2), guess where the stock opens?

 

Hahah

[Guest]

Greg, is there more to it than front running pump and dumps? He has a ton of DVDs and thousands of videos. 

[Gregmal]

I honestly haven’t follow him in years. I’m sure there’s more or other stuff. Any good trader has to evolve. Tim is definitely not an investor, so I’d assume he’s found ways to refine it. Even within the basic strategy there is a ton of detail and stuff on details. Hold period, often quite short. Risk management rules, when shorting never hold overnight. When to hold overnight long. Same as investing, there’s many different angles and points of attack. Some work, some don’t. Some work most of the time. Nothing works all the time. It’s just a unique niche because you do know a couple things for absolute certain when dealing with pump and dumps. The short term goal is to get the stock up. And the mid duration goal is to sell into it. With the end result being, pretty much 100% of the time, that the stock ends up back or below where it started. That’s the unique things with the super junk OTC and mini Nasdaq pumpers. They are always total garbage. So your risk of running into, say a Tesla, is not there. Especially when you can confirm it’s the target of an active manipulation campaign. 
 

So overall, all I’m saying is to don’t blindly knock stuff. If you’re a younger guy starting out and just not 100% committed to actual investing yet(some aren’t) with some work I think it’s one of the more replicable strategies for legitimately making money I’ve seen over the years. But if you have real money already it’s probably not worth your time. If you look, of his ~7500 total trades, he s right about 75% of the time and an average profit is like $1500. Plus now with the super tough rules on OTC trading you have to focus more on other stuff, which of course starts introducing you to the quant guys and that’s where you run into risks like that dude who just blew up his fund shorting a Chinese ipo. 

[Guest]

This is really almost mind blowing to me. I didn't even realize this stuff was possible with individual stocks. Options, sure but not stocks. 

 

The other day, I met with a guy about a retaining wall and some other things around my house. The guy was 33 and ran a foundation repair business or something. We got to talking about stocks and he ran through some of his trades and said he's made $17 million (I think he said in the last 3 years). He also told me he doesn't use subcontractors and that he had 5 crews of 3 guys (per filings, the company was incorporated until Nov 2022!). My father in law gave me one of the subcontractors cards too (he's the one that referred the 33 year old to me). I found his linkedin and it says he was a bartender until Jan of 2023. I think he also mentioned Sykes.

 

I thought he was totally full of it...but maybe not. I even assumed that he had $100,000 at 23 and earned 50% a year, paid no taxes and no drawdowns...and still wasn't close to $17 million. He said he does this work because it's safe and he employees his mom. He was also concerned about college costs for his  future kids. I'm like at $17 million why worry about any of that?

[LC]

People lie, Paul. 

[Parsad]

3 hours ago, LC said:

People lie, Paul. 

 

+1!  Also, even if they don't lie, they don't necessarily tell you the whole story. 

 

Frolich blew up several times before he hit that one year record.  Great for him, but the biggest thing about him was that he was able to recover mentally and try again. 

 

99.99999% of people would not be able to replicate what he did, nor hold the mental strength to start all over again after losing everything...over and over.

 

Cheers!

[Castanza]

11 hours ago, LC said:

People lie, Paul. 

 I've worked a handful of shit jobs in my life. Turns out the more blue collar you go the more extravagant the stories get. I've yet to meet a contractor that isn't a "pocket millionaire" by 30 

[Guest]

haha yeah, I know guys! I was just surprised because I don't really see a point in lying to me about it. Like what's the point in that?

[Gregmal]

I mean what I think gets lost amongst most people as well is that for the majority of the world, you only need to get rich once. So the guy above Frohlik or whatever who did a gazillion percent in 2020….or these younger kids following Sykes strategy…who cares? I listened to the Frohlik podcast and honestly didn’t hear a single thing the guy was doing as far as strategy that is anything more than individual gut feeling trading. Absolutely nothing replicable. Just a high level ability to read market setups which most don’t have. But again…he did it. Only financial world people sit around shitting on strategies because “I don’t think it’s sustainable” and “he takes too much risk” and “oh he did blow up that one time”….and ironically I’ve found most of those people who act as the Siskel and Ebert of other peoples portfolio strategy….mightily underperform themselves.
 

I’ve studied and tried so much different shit because I’ve been fortunate to be in a position where I can over the years…and the truth is that most of anything at the highest levels of execution, works. So just find something that fits YOU, work your ass off at perfecting it, and let the rest happen. 

[Parsad]

7 hours ago, Castanza said:

 I've worked a handful of shit jobs in my life. Turns out the more blue collar you go the more extravagant the stories get. I've yet to meet a contractor that isn't a "pocket millionaire" by 30 

 

LOL!  Cheers!

[Parsad]

6 hours ago, stahleyp said:

haha yeah, I know guys! I was just surprised because I don't really see a point in lying to me about it. Like what's the point in that?

 

It's always to make themselves sound bigger than they are, etc.  That being said, I'm not saying he was lying.  But probabilities suggest he was.

 

Cheers!

[Parsad]

6 hours ago, Gregmal said:

I mean what I think gets lost amongst most people as well is that for the majority of the world, you only need to get rich once. So the guy above Frohlik or whatever who did a gazillion percent in 2020….or these younger kids following Sykes strategy…who cares? I listened to the Frohlik podcast and honestly didn’t hear a single thing the guy was doing as far as strategy that is anything more than individual gut feeling trading. Absolutely nothing replicable. Just a high level ability to read market setups which most don’t have. But again…he did it. Only financial world people sit around shitting on strategies because “I don’t think it’s sustainable” and “he takes too much risk” and “oh he did blow up that one time”….and ironically I’ve found most of those people who act as the Siskel and Ebert of other peoples portfolio strategy….mightily underperform themselves.
 

I’ve studied and tried so much different shit because I’ve been fortunate to be in a position where I can over the years…and the truth is that most of anything at the highest levels of execution, works. So just find something that fits YOU, work your ass off at perfecting it, and let the rest happen. 

 

I don't disagree with you.  But even Frolich said that he was surprised that he had the mental strength to fund his investment after each blow up and continue.  He doesn't think others might be able to do that.

 

So, like Buffett, there is an inherent ability to deal with loss or risk management.  Buffett doesn't lose money to make money...Frolich blew up several times to make money.  I like Buffett's way better...even if it takes me a lot longer!

 

Cheers!

[Gregmal]

Yea that is really what I think separates value investing from everything else. There are a lot of ways to make money in the market. They all have their pros and cons. But in terms of the most reasonably applicable and overall skillset required as it translates to actual results; value investing ranks above and beyond everything else because if you do it correctly, its very hard not to do well over the long run. Which leads into Buffetts quote about "no one wants to get rich slowly"....which answers the "if its so easy why doesnt everyone do it" question that will inevitably get asked. Even here, a place for value investors, how much bottom calling and top calling and "I just cant see how we dont go much lower" goes on? Its an irresistible siren song it seems. 

[ValueArb]

On 6/2/2023 at 2:56 PM, Gregmal said:

A lot his strategy involves utilizing certain resources to identify manipulated penny stocks and then trading the volatility. It’s 100% repeatable. It takes work. But it’s actually extremely predictable when you find them and low risk if you take certain measures to reduce some of the obvious risks.
 

I don’t know why there’s always an instinct to discredit or poo poo or say it doesn’t count. I mean Monish Pabrai is still given credit for like 3 good years 2 decades ago. This guy has twice turned like $10k into over a million in a few years including as a college student. All using the same framework and process. He also shuttered a hedge fund because at a certain size the strategy isn’t viable and he made investments outside his circle of competency. But man, it’s crazy how there’s always a rush to declare “it doesn’t count”. Dude is a self made multimillionaire 100% from trading and now basically does the Instagram life thing. Not bad.

 

Its because people intuitively understand that extraordinary claims require extraordinary evidence. And we also understand that people selling systems are almost always frauds, in part because if you had a great system you wouldn't flood the market with competitors reducing your returns.

 

None of this is saying that Sykes didn't turn a tiny sum into $2M or whatever. Someone wins a lottery every day. Every year someone wins the WSOP main event for millions of dollars, but almost never the best player and sometimes the winner is a terrible player. I used to play in a high stakes game built around a huge fish that had won 4 WSOP bracelets, won WSOP Player of the year once and would have won it twice if they hadn't changed the rules.  And these famous "winners" get to become poker coaches because clients don't know how to play poker well so how would they know how good their coach is?

 

Too my shame I've spent enough time around the casino to know a few gambling "experts" that were so good at it that they made a living selling their sports betting picks. Then I found out that the key to the business isn't handicapping, it's deluding lots of wealthy clients with your reputation and lifestyle. Even though your picks are pure guesswork, half your clients will still win, and they'll stick with you even through long losing streaks because you are a "proven winner". 

 

I've often wanted to perform the following experiment, not for my personal financial benefit, but for science;) I'd start sixteen anonymous internet accounts that give out free stock picks. Each pick would be selected for high volatility and momentum to maximize the potential upside, esp. if they have an impending catalyst. After a few picks roughly half my accounts would be losers and the other half would be winners. I'd shutter the losers and start charging for the winners. Again after a while I'd probably only have four accounts that were winners and one or two that have outstanding returns. Again I'd shutter the losers and unveil myself as the master trader behind my highest return account, and market the hell out of my service,  start selling  books, training videos, more personalized stock picking services, etc. Over time I'm going to trail the market, but many clients will stick with me because I'm a "proven winner"  much like Cathie Woods. 

 

Again, I am not saying that Sykes is a fraud, I'm saying I don't know and haven't seen any evidence to convince me. I think it's healthy to always be skeptical of huge claims without corresponding strength in the evidence. Sykes may have parleyed a great run as a trader into a coaching business, but that doesn't tell us whether his run was luck or skill, or that he is able to coach clients into achieving similar levels of success. After all if you have thousands of clients statistically at least a few dozen would end up with amazing results just due to pure luck.