Review by Kim, November 10, 2009

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Wicked profits

I’m writing a review about options trading site called “Wicked profits” - http://www.wickedprofits.com.

The site trades options spreads. They are in business since 2000. Very impressive long-term record:
2009 YTD 27.22%
2008 36.58%
2007 48.00%
2006 55.78%
2005 48.03%
2004 26.83%
2003 31.07%
2002 96.56%
2001 55.32%
4/2000 - 12/2000 132.13%

They put one trade per month, only one small monthly loss of 0.21% since December 2004. 36% gain in 2008 – how many services you know that can show positive result for 2008? If they think the market is too volatile, they won’t a trade that month and you get a free month. They didn’t trade in October 2008.

The cost is $90 per month.

Bottom line: it is a very conservative, honest and consistent service. Completely duplicable, highly recommended.

Review by Dave, December 23, 2009

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I have been a subscriber for over 6 years. The annual performance figures of the prior review are fact and obtained from actual trades executed by auto-traders, where a subscriber has an account with OptionsXpress and the one recommended index option spread trade per month is automatically executed through that firm. You are able to use there recommended spread trade through any firm, but most subscribers elect to auto-trade through OptionsXpress. All trades are open for no more than 35 days; thus there is no bias leave a losing trade open. The single recommendation each month is well reasoned, and performance has been consistent. But there is always potential for the market going against a trade in a month, resulting in a significant loss for that month.

There are monthly, quarterly and annual subscriptions. The annual cost is $720, as I recall.

You need about $15,000 capital to have a reasonable transaction cost, which will allow a spread trade of 15 index options. Trades are always on a net credit basis, such as selling a one month call and buying a call that is a little further out-of-the-money. Profit per spread recommendation is generally targeted to be about $50, before a fixed $3.50 commission cost per spread option at OptionsXpress. If the editor believes that it is a higher risk market, he will go a litter further out-of-the-money to reduce risk and thereby plan for a trade with as little as $30 profit per spread. The editor tells you the basis and reasoning behind each trade, and follows the technical aspects of the market and the particular open trade with daily emails.

I am very satisfied.

Review by SnoopyJC, March 13, 2010

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Let me start by saying that I have not subscribed to this service, but I have a good reason, and that reason is MANY RED FLAGS. FIRST RED FLAG - they have no names of who they are listed on their website. SECOND RED FLAG - their address is a Las Vegas mail forwarding service called MailLink. THIRD RED FLAG - they have no phone number published (it’s hidden behind a password). FOURTH RED FLAG - a very limited number of reviews (above) and both give the service 5-stars in every category - could be both fake, as neither reviewer gives a weblink. FIFTH AND MOST IMPORTANT - consistent, “Bernie Madoff” style returns - everybody has a drawdown, and a significant one - their results are “too good” to be believable. Remember, if it sounds too good to be true, it probably is!
(I thank @aiki14 and @IRON100 for their insights here that led me to investigate further and draw these conclusions.)

Review by Kim, March 15, 2010

SnoopyJC,

First of all, let me say that I have no vested interest in this website. I actually cancelled my subscription because for me the risk/reward is too high. I’m implementing the same strategy, but with different risk/reward.

How can you rate a service that you did not even use? All your red flags mean nothing. They don’t list the phone number, but if you email them, you will get a response within 24 hours, usually less.

Regarding the returns – you can subscribe and see exactly how those returns are achieved. Nothing mysterious about this, just credit spreads with very good timing. http://pro-trading-profits.com/ is tracking the service and verifies their results and they match exactly to what the service is reporting. pro-trading-profits also has 16 reviews of this service with average rating of 9.2. The ratings go back more than 2 years. You can say they all are fake, but I don’t believe it.

Review by grnthmb55, March 19, 2010

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I really don’t feel that someone who hasn’t joined this service has any right to give a review of it. I have been a member for two months now, and can attest to the fact that last month we returned 3.09% and this month’s trade was also a success, bringing in 3.62%. There is nothing “Bernie Madoff” about this system. Wicked Profits never takes any of your money… your money stays in your optionsXpress account, and if you sign up for autotrade, then the service will automatically invest your money in its net credit spread for the month. The net credit spread is chosen through much due diligence and market analysis. The members area of the website is updated consistently every morning on weekdays, giving a detailed analysis of the previous day’s trading, and where they think the market is heading, and why. If you ever have any questions, you can submit them via email and you will get a detailed response usually within 24 hours. Snoopy- you can continue to stand on the side lines and watch, or you can join like I did and start making an average of 3% a month. But don’t come on here and criticize a service that you never even tried.

Review by Portfolio Man, March 19, 2010

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Value for the Money	Not Rated

Snoopy - you shouldn’t comment on something you don’t have first hand knowledge about. Although, you are correct that they really don’t publish their names which is 1 correct fact.

All,

I did the 60 trial period . Here are my thoughts on the service:

Pro’s
1) I made money 2 months in a row!
2) They do credit spreads in hopes they expire worthless;
3) They have a 61 month winning streak (cannot validate other than the last 2 months I joined). Maybe the are both good and lucky (just my opinion).
4) Nice stream of income as long as they have winnnig trades;
5) This approach does not rely on 1 company with good or bad news that can materially change the stock price, it is an index option
6) They have a good view on technical analysis to make this work.

Con’s
The credit spreads only net you a credit of $.30 to $.50 on a 10 point spread because they buy the spread so far out of the money. For example, if you do a bear spread when the S&P is trading at 1130 and you sell 10 SPX 1160’s and buy to open 10 1170’s, you make a credit of $.50 or $500 as long as everything expires worthless which is their goal and hence you make 5% for the month ($500/10,000 investment). However, to make $500, you have to be willing to risk $9,500 if the market has some huge day. Now they have stops to protect you and obviously time should be on your side since they only put trades on for 30 to 45 days.

However, this week scared the heck out of me since we were approaching their target on the short portion of the option and it almost hit their 3 days this week. At one point, for the $350 I pocketed from the spread, I was out on Wednesday by almost $3,000 because the time decay was not as quick enough and we were less than 1 pt away from the short portion of the call. Plus the S&P went from 1,160 on Wednesday to a high of 1,169. that could have been disasterous if that would have happened and wicked profits didn’t have the right strike price but they did and kudos to them. Plus I tried to buy back my short option today and couldn’t as the last Friday for index option trading is the Thursday before expiration. You could only exercise index options on Friday expiration. So basically, you are at the mercy of the market on the last day if the trade is close to the strike price.

My conclusion, they had another winning trade and demostrated excellent capabilities to know where to set the trade at (ie 1170) this month but I don’t really think that making $350 is worth possible losing $9,650 if the market went on a huge rally or if their technical analysis was off by 10 points. The risk is not worth the reward to me but may be for other traders. Basically, i would have to have 20 winning trades at a net credit of $.50 per trade to make $10K but yet I can lose that on one trade. For those that have been with them for 60 months, you have nothing to lose and have done well and I would encourage you to stay and keep using your money management skills by not reinvesting profits. For new people like me, I am not sure the risk/reward profile is worth it but this is another way to make money if your risk portion of your portfolio allows for such a strategy.

I hope this helps everyone.

Review by Bigtrader, March 20, 2010

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PortfolioMan,

I agree with alot of your comments (high risk/very low reward)except you made money on this last trade. Impossible!! I did a 60 day trail as well and just found out my trade settled today for a loss of net $2K plus. Hence, I experienced a 20%+ loss for the month!!!!! Thier note on Thursday said the offical trade is to close the short call if the SPX hits 1,170 and it never did. But they did say it is up to people if they want to close the position at the end of the day. They should have highly recommended it, not leave it up to people. I would not follow these guys as 1 trade can loss all of your profit quickly. Your max gain on a 10 contract credit spread at $.35 is only a gain of $350 while you have $9,650 at risk????

I would check your brokerage account as you had to lose.

For those that don’t understand SPX options, they expire on Friday morning and they apply a calculation to the closing price. So even though the SPX never hit 1170, it is a calculated formula as of Friday morning. You have no control on the final number and are gambling.

Review by Bigtrader, March 20, 2010

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I meant to give them all 1 star as I lost 20% in 2 months!! For some reason the stars were improperly coded on my last post.

Review by Chuck, March 21, 2010

Overall Rating
Performance of Picks/Advice	Not Rated
Consistency	Not Rated
Interesting to Read/Educational	Not Rated
Customer Service	Not Rated
Value for the Money	Not Rated

One of the worst option advisory service out there. High price, low return and exceptionally high risk. Expect 2 or 3 time per year where your trades will get within 1 or 1/2 point of being stop out at a potential loss of from 30 to 40% of your capital on each trade. I’d been with this service for 2 years now and I’d lost 50% of my capital because I chose to close out the losing trades instead of waiting for it to get to within 1 point of being stopped out at an even bigger loss. It is true that the track record contain only one tiny loss for the last 5 years but that didn’t tell the whole story. The fact that for several time per year the trade came within on point or less of being stopped out at a crippling potential loss tell you more about the system than just the track record alone. Anyone who trade this system is basically gambling with their money.

Review by Kim, March 21, 2010

Review by Portfolio Man, March 21, 2010

Overall Rating
Performance of Picks/Advice
Consistency
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BigTrader,

You are right as I just checked my account and lost $9K (about 30%) on the February trade alone. I posted this review thinking I was on the side of a winning trade. I apologize to everyone as I was wrong. I called my brokerage and they said the SPX settled at 1,172.96 Friday morning. I had 30 1,170 contracts. Not a good first time experience with this service. One bad trade can ruin many good trades. This services is very high risk for little reward. I am changing my rankings accordingly. It is up to the individual if they still want to use this service as I will not continue with them once my 3 months is up.

Kim,

I did have a stop-loss and it never triggered. Just an FYI, if they would have picked the 1,160 SPX instead, on Tuesday of last week, the SPX went from 1159 to 1169 mid day. I probably would have lost about 60% per contract because it moved so fast. So they got somewhat lucky picking the 1,170 but they said the official trade was to sell at 1,170 and it did’t hit. They should have told everyone to sell at close of business on Thursday to limit the risk and take the loss. Also, while I don’t think this is the worst service, you have to play with money you can afford to lose 50% in one month if a trade goes bad (ie their Feb 2010 trade). Last week was nerve racking as the SPX was trading and hitting the 1,169 level on 3 different days and my account was showing some big losses.