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A golf instructor told me this story about a newsletter stock picker guru.
A stock picker guru writes a newsletter that he sends off to 10'000
customers each week. Each week he picks ten sure winner stocks that he says
are going to go up that week. (And everyone pays for the weekly
newsletter.)
When the week is finished, he had guessed five winners and five losers.
5'000 customers of his newsletter had, by chance, bought stocks on the
winning side of his calls so they take his newsletter another week. The
other 5'000 customers had, by chance, bought stocks on the losing side, so
they drop his newsletter.
The next week the same thing happens, he had guessed five winners and five
losers. Again, half his customers are winners a second time and they send
in their money, the other half are losers, so they drop his newsletter.
This same thing goes on week after week, 2'500 winners, 1'250 winners, 625
winners, 312 winners, 156 winners, 78 winners, 39 winners, 19 winners, 10
winners.
Those last ten newsletter customers are going to swear to you that this
stock picker guru is a genius because he has picked winning stocks for 10
weeks in a row.
When I heard about the E-Trade contest and how some contestants were doing
so well, I thought of this story. There is a moral here somewhere, but I'm
not sure just what it is.
Regards
Zane Kori
(Disclaimer: This story is to entertain, not offend.)
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