Finished the pennystock.com calculations of profits and losses for each year’s sales assuming $2000 is purchased of each recommended stock in the year it is recommended. Stocks recommended in one year typically sell over several years. Four stocks are recommended each month but I did see some years with less than 48 stocks. Here are the profits/losses:
1996: 0 (just purchases, no sales)
1997: $19,069 profit
1998: $23,182 profit
1999: $49,733 profit
2000: $48,299 profit
2001: ($12,192 loss)
2002: $12,740 profit
2003: $34,180 profit
2004: $33,500 profit
2005: $17,600 profit
2006: $20,060 profit
Apart from the loss in 2001 (might have been caused by the internet bubble crash in 2000), the figures are good returns. Cash going into the account would be at the rate of $2000 per stock with 4 stocks recommended each month but the data I am working from just shows some years having 43 stocks purchsed for some reason. 1996 only had 8 stocks purchased because the service was started late in that year. At some point in 1999, you no longer need to add cash to the account to keep buying the recommendations. Profits to date will pay for the stock. More than 2000 shares could be purchased probably starting in 2000 so profits get reinvested. Remember to always buy the same number of shares consistently even when moving to a
higher number of shares or you do not get the benefit of 70% of the stocks earning 50% or more. The
high profits in 99 and 2000 may be due to the economy running so hot as the Internet bubble kept expanding. The price paid in 2001 losses when it burst is not really a lot compared to the years of profits. Even if you had first subscribed to the service in 2001, you would not have hit this loss because many of the stocks sold in 2001 were purchased in prior years. One thing to decide when making your first purchases of stocks is whether it might be too late to buy into a stock that was recommended earlier and has not yet been sold. The price of the stock might have already risen most of what it is going to or it might have fallen and be one on the horizon to be sold at a loss. If you want to play it safe, do not buy any stocks except in the month they are recommended or at the recommended price.
The current economic issues with subprime
mortgage defaults and the fed’s
lowering of interest rates will likely not have much affect on someone starting their subscription now. Similar to 2001’s loss, many stocks that get sold at a loss in 2007 and 2008 would have been bought in prior years. It might turn out to be an advantageous time to subscribe. Stocks being recommended may be selling at a discount. They might sell at a premium once the sell signals are given in future years. A small number of them might be bought and sold at a loss in 97 or 98.
As I did the calculations for each year, it was amazing to see loss after loss happen in sequence only to be wiped out by even more profits happening in sequence. The guy who picks these stocks sure knows what he is doing.
For what it’s worth, here’s my disclaimer: I may have made some calculation errors in doing all these hand calcualations, but I believe the
margin of error is pretty small. The results you see listed above clearly indicate some winning stock picks to consider going after. You can adjust the calculations to whatever amount you are considering
investing. Just adjust the 2000 shares
down or up to whatever your game is. As with any
investment, do not take what I have written here as absolute gospel. If you subscribe, do the calculations yourself and see what you think.
Ed
Barsano Creator