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Promoters- Tim Sykes Penny Stock Trader

Why Penny Stock Promoters Are So Evil

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Written by Timothy Sykes
Updated 12/20/2022 5 min read

Don’t dismiss promoters as just another part of the market.

Twitter handles make it easy to ignore the truth…

Promoters destroy real lives!

Zack Morris and Atlas Trading presented themselves as ‘bro’ traders with absolute authority.

Whenever I questioned their legitimacy, their followers came out of the woodwork to defend them with blind devotion.

Then, the bedrock of trust turned to sand.

The SEC indicted the group on fraud charges totaling more than $100 million.

There were real people caught up in their scams.

Tweets like this were just a sample of the outrage…

Look, I know how easy it is to get swept up with these groups.

They work just like a cult, making you feel special and part of some secret group of insiders.

I can’t stop these folks from popping up like weeds.

But I CAN help you identify them and ask the right questions.

And that starts with realizing ALL promoted penny stocks follow my 7-Step Penny Stock Framework.

Every Penny Stock Fails

Here is a picture of my 7-Step Penny Stock Framework:

Print this image and stick it next to your computer.

I know someone will read this subheader and be like, “Tim, I found stock ABC or DEF that went Supernova and never came down.”

The amount of times this happens is so rare I can’t honestly remember one.

So, rather than nitpicking my broad statement, just go with the fact that the odds favor to the point of a near guarantee that a Supernova penny stock will fail at some point.

Promoters trick you into thinking that you’ve found that diamond in the rough, that one penny stock destined for glory.

They cherry-pick data and present you with the best face possible for these stocks.

Yes, I trade alongside these guys knowing what they’re up to.

However, I treat it as just that – a trade.

My morning panic dip buys last minutes.

I never pick up a stock thinking the company is in a prime position to return value to shareholders.

Heck, I rarely hold trades overnight.

And when I do, it’s almost always tied to a news catalyst I pulled out of our StocksToTrade Breaking News Chat.

The difference is promoters want you to buy the stock to sell it to you at higher prices.

I try and ride alongside them.

Additionally, former Supernovas can and often do bounce.

Dark Pulse Inc. (OTC: DPLS) is a stock I recently traded when they announced the stock would list on the Nasdaq.

This stock ran hard several times after its initial Supernova back in late 2021.

That was when the CEO blocked me on Twitter for calling the stock what it was…a Supernova.

But like every other penny stock, it eventually died.

Trading Alongside Isn’t The Same

Tim Sykes checking his top penny stocks list in Italy
© Millionaire Media, LLC

Let me be very clear about something.

I don’t view exploiting the conditions created by promoters as off limits.

In fact, that’s how I teach my students to create an edge.

Think about it more simply…

If I know there’s a short-squeeze potential when price breaks a certain level, I’m going to trade the setup.

I call out these promoters because they come up with insane price targets based on nothing but hot air and Danielle Steele-like stories.

They want the stock to go up because they ALREADY OWN shares.

I don’t.

I buy stocks based on the price action and what I see as their manipulation.

But I don’t go out and call a stock a raging buy when I own shares.

That’s a pump and dump.

All of my trades are posted for anyone to see on Profitly.

Someone who won’t post their trades or provide them should be treated with extreme caution.

And you know what gets me suspicious immediately?

Someone who calls me out as a short-seller.

Because the last stock I shorted was Global Tech Industries Group (OTC: GTII), which was my second short for all of 2022.

These guys like to pick fights to get more people following them and drag them into these garbage stocks.

That’s their game.

And listen, I’m wrong sometimes. I’ve had losing trades, some of them were pretty nasty.

I don’t hide them.

But I also see the market for what it is.

Just because a promoter looks right in the short-term doesn’t mean they’re worth the pixels on your screen.

Treat all of them with extreme skepticism.

And then use that mindset to trade profitably.

—Tim


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Timothy Sykes

Tim Sykes is a penny stock trader and teacher who became a self-made millionaire by the age of 22 by trading $12,415 of bar mitzvah money. After becoming disenchanted with the hedge fund world, he established the Tim Sykes Trading Challenge to teach aspiring traders how to follow his trading strategies. He’s been featured in a variety of media outlets including CNN, Larry King, Steve Harvey, Forbes, Men’s Journal, and more. He’s also an active philanthropist and environmental activist, a co-founder of Karmagawa, and has donated millions of dollars to charity. Read More

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* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

Millionaire Media 66 W Flagler St. Ste. 900 Miami, FL 33130 United States (205) 851-0506 This is for information purposes only as Millionaire Media LLC nor Timothy Sykes is registered as a securities broker-dealer or an investment adviser. No information herein is intended as securities brokerage, investment, tax, accounting or legal advice, as an offer or solicitation of an offer to sell or buy, or as an endorsement, recommendation or sponsorship of any company, security or fund. Millionaire Media LLC and Timothy Sykes cannot and does not assess, verify or guarantee the adequacy, accuracy or completeness of any information, the suitability or profitability of any particular investment, or the potential value of any investment or informational source. The reader bears responsibility for his/her own investment research and decisions, should seek the advice of a qualified securities professional before making any investment, and investigate and fully understand any and all risks before investing. Millionaire Media LLC and Timothy Sykes in no way warrants the solvency, financial condition, or investment advisability of any of the securities mentioned in communications or websites. In addition, Millionaire Media LLC and Timothy Sykes accepts no liability whatsoever for any direct or consequential loss arising from any use of this information. This information is not intended to be used as the sole basis of any investment decision, nor should it be construed as advice designed to meet the investment needs of any particular investor. Past performance is not necessarily indicative of future returns.

Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”