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written by reader James Altucher’s Secret Income Pitch

By haughlaw, October 22, 2017

I subscribe to Altucher’s newsletter which was a modest amount. As with all these services, I now am inundated with new, more expensive services. It is somewhat annoying but also somewhat informative. I was really confused by this promotion when it shows him picking a couple strangers at random and show them how to make Instant Cash in a matter of minutes. Poof, you have money in your account. He is selling naked puts. However, i looked more closely at the first two examples he does and I am really confused. I am familiar with options but not an expert. I have always read that when selling naked puts, you should chose a strike under the current stock price. And of course, be ready to own it if exercises. You hope the stock is range bound or heading up.

However, in his examples he is selling puts higher than the current price. Although at the time of sale, if immediately exercised it would still be slightly profitable due to the intrinsic value. However, here is what happened with one after i went back to my charts and reconstructed what could happen. On 8/15/17, AAPL was at 161.62 when he sold the 9/27/17 165 put for 6.45. Three days later, AAPL hit a low of 155.11. Over the next two weeks or so it went back up to 164.94 but then dropped to a low of 149.99 before expiration. So within 2 days, unless you traded out right away, I see this as a loser trade. Am i missing something?

The second example is the same thing with DIS, which was at 101.82 at time of sale of put. On 8/15/17 he sold the 9/29/17 104 put for 3.20. DIS went to high of 103.45 on 8/30/17, then dropped to a low of 96.26 on 9/9/17 and closed at 98.57 on expiration date. Again, I see this as a loser trade.
Am i missing something? Anyone using this service at $2000/year? Or any other of his services? Any input or correction of my thinking is welcome. Thanks.

This is a discussion topic or guest posting submitted by a Stock Gumshoe reader. The content has not been edited or reviewed by Stock Gumshoe, and any opinions expressed are those of the author alone.

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catherine
catherine
4 years ago

Seems to me what you are “missing” is the greed and hope that would cause you to believe this service could be worth $2,000.
You’ll continue to get these offers for the more expensive products, probably with the “guarantee” that if you don’t make money, you’ll get a 2nd year membership free…. Stay cautious!

👍 195
Diane
Diane
4 years ago
Reply to  catherine

the guarantee is not “IF” you don’t make 2000 per month…. the guarantee is “IF” he doesn’t SHOW you 2000 in profitable trades per month- very different.

Mike
Mike
4 years ago
Reply to  Diane

What’s the difference? If Altucher provides trades that are profitable but the subscriber doesn’t elect to make it, that isn’t the service’s fault.

Dan
Dan
3 years ago
Reply to  Mike

What he doesn’t cover clearly in his ads is that you have to have the full purchase price of the underlying stock left in reserve in your account to make the naked put trade. His account on his ads has 651K in it. He recommends having at least 20K in yours and never calls it what it is…selling naked puts. Most of his trades require 20 to 30K be left in your account which means there are some trades you can’t make because you are underfunded and, if you do one of his trades, you’ll have no funds left to do any more until you close the trade you made. Therefore, unless you’ve got six+ figures in your account you’ll only be able to make a few trades. You pick one of his losing trades you wind up with the stock and no money in your account. He calls this “owning a stock we always wanted” I subscribed and found out he makes a lot of losing trades. I wasn’t in it to “own a lot of stocks I never wanted”. Advice? Don’t touch this scam with a 10 foot pole!

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Diane
Diane
4 years ago

I like the guy- he’s interesting. lets see how it plays out, you can also do 3 months but no free computer 🙁

@BXGVS
4 years ago
Reply to  Diane

I knew I saw that option! I know I can afford that before the 20th, I’m too Up for this! James is highly respected.

liberallez
liberallez
2 years ago
Reply to  @BXGVS

James is a doofus who has turned himself into a shill for the newsletter scammers!! Now, suddenly, he’s a “millionaire expert” (pushing other people’s scams.)
I’ve seen this same option dodge played by other “experts” in other venues (sidewalks, restaurants, etc.) and now it’s something James has created????
James is “highly respected” by his fellow con artists!!

👍 58
robert
robert
4 years ago

Hi , I have joined his subscription and have cancelled it right away costing me 550 dollars for a 3 month subsription. It is not a scam but it will only work when you have at least 14000 dollars to play with. This “small “detail they forget to say once you order. You earn money with selling puts. In my case i had 3500 dollars to play with. With this I was able to buy 1 recommended put , earning 150 dollars. the put expired and had no obligation to buy the stock. So in my case I could max earn 450 dollars in 3 months, costing me 550 dollars. Your are given a tip every week. Each week you have to invest at least 3500 dollars. If I would have that my earnings would have been max 600 dollars.

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Mike
Mike
4 years ago
Reply to  robert

Thanks for the reply, Robert. It’s probably me, but your numbers aren’t adding up.
Your first trade made $150. You said that equals $450 after 3 months. But that means only 1 trade per month. Doesn’t the program offer weekly trades? Assuming it does, and assuming the average profit is $150, that’s $600 per month, $1,800 after 3 months. Also, I would think the $150 profit per trade is likely on the low side.
One question: how many recommended trades per week are given?

Mohammad Ali Hashmi
Mohammad Ali Hashmi
4 years ago
Reply to  Mike

with Robert’s capital, he can only trade once a month and gain $150 which adds up to $450 after 3 months . I saw jame’s ad yesterday and was doing some research on the guy before deciding to join the 3 month program.

@BXGVS
4 years ago
Reply to  robert

Wow. That’s super deceiving? And no refunds. And they make it so simple for you to order (them to pocket YOUR money). And, that’s probably why they were using James’s account in the public experiments, and they computer he was using says $0.00? But, that was his earnings of $0, not his funds balance. SMH

Paul Fendler
Paul Fendler
4 years ago
Reply to  robert

Unfortunately, you need a LOT more than $14,000. So many of the trades go the wrong way, you end up holding more and more stock. You can sell the stock before they recommend you do in order to stay liquid, but you end up losing money on the trade. I’ve been using the service 5-6 months and I think I’m a little better than break even. I still like James a lot as a person but so much of this service is not as advertised I’m a bit disappointed.

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Mary Ann Swissler
Mary Ann Swissler
2 years ago
Reply to  Paul Fendler

I know. where’s his guaranteed $3,000 month? His ads and that insipid video say you can do this with little money–a total lie!
I’m looking for that sales video or print ad. If anyone has it let me know?

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