This video is how to not get double scammed. And my name is Karl Domm. I’ve been trading stocks and options since the mid-1990s. And I’ve taken well over 50 online courses that have to do with trading.
And there are Youtubers that show themselves trading via live streams. And I watched a guy make over $10,000 in like five minutes. And I actually watched the trade. It was real trading, real money, made right in front of me. And I just thought wow.
My first thought was: how’s he doing this? And then I thought, if this is real I can follow his trades and I can make some of that money. I know these guys put out warnings that day trading is risky and don’t follow their trades, but forget it I can make some easy money here.
If you just started learning about day trading and all you hear about is how much money others are making, you have a belief that it’s not only possible but probable to make money day trading. And then you watch a guy make serious money right in front of you. Would you consider following his trades?
The psychology is that if this guy can do it right in front of me all I have to do is copy him. So even though he’s telling people not to follow him they’re doing it anyways. And it’s just human psychology, and these gurus understand fear and greed and how it’s created and how to manipulate people with it. And when they say don’t follow my trades over and over and over again, what comes to mind? All this does is bring out the thought of following them into top of mind.
Don’t think of a pink elephant. Did you picture a pink elephant in your mind? Don’t follow my trades. Now, following trades is on the top of mind. Especially, when I see him make $10,000 right in front of me.
Now, that I’ve established that people are following the instructor’s trades. How many people are signing up for an instructor that makes money live right in front of them? Not to mention, placing all the ads everywhere. The followings could be in the tens of thousands. And why is this important to have; thousands of followers and why would it be important to have others follow the trades?
Well, when low float stocks are traded, and those are stocks with a low amount of shares available, they can be manipulated by a few thousand people trading them. Kind of similar to the meme stocks and how they’re being pushed by groups on Reddit. It’s the same concept except easier because the stocks being used by these gurus are low float stocks. So how are people scammed?
Well, here’s scam #1: The instructor calls out when he’s going to buy seconds before the stock reaches the buy point. If the students are following his trades, they’re buying at his recommended buy points. His buy points are usually around a half second to one second ahead, so the stock may not even reach the buy point. But if it does he’s usually about a half to one second ahead on his call to buy.
Now at this time, there’s nothing fishy going on. He’s making a call that the stock will go higher, and if and when it does, he will buy it. And he’s encouraging you not to do this. Now if others are following, they’re also buying at his buy points so he’s getting in and others are getting in and there’s nothing wrong with this.
The problem arises on the exit. He calls to buy a head but does not call ahead when selling or taking profits. For example, in a live stream I was watching, when the stock was at $8.35 he called to buy at $8.50 and then he got in himself at $8.45. So then while the stock was around $8.48, he projected ahead and said he was going to add when it got to $8.55 and the stock was still trading at $8.48. And then he called to add when it got to$ 8.65 but it was still at $8.48. Then he called and said well when it gets to $8.75 he’s going to add; and $8.85 as it moves all the way to $9. The whole time it’s still at $8.48.
The whole time he just calls out potential buy levels so people are waiting for the stock to move higher so they can buy it and they’re thinking it’s gonna go to $9 and they have their mouses ready to click to hit the buy button. And they keep buying at certain levels as it moves higher. Now remember, everyone has their hand on the buy button ready to buy, buy, buy. Now as the stock moved to $8.60 and people were buying and thinking that it was gonna go towards $9, without warning the guru made the call that he sold at $8.60.
So when he sold there was actually no call until after he was already out. So after he was out then he said okay I’m out. So what I’m seeing is a guru hyping up multiple buy points so people following have their finger on the buy button, and then without warning he hits the sell button for himself. Anyone following him is buying what he sells. Then after he sells, you can see the stock move down rapidly because everyone’s trying to get out at the same time.
And you can see this for yourself if you find one of these guys trading live. And you can see the stock drop after the guru says he wants to get out, which is an indication that he has students following him and that they all get out right after he does. This is an edge for the instructor, and it’s called front running. You can follow them in but you can’t follow them out.
It’s like jumping off a cliff. Let’s say that you’re jumping off a cliff with a friend, Roy, and you each have a parachute. Roy has experience so you’re following his lead as far as, you know, when to jump and when to pull the string to deploy the parachute. Roy says ready set go and you both jump off the cliff at the same time. As he clearly called out the entry into the jump.
Now, you’re waiting for him to call out to pull the string. Instead, he pulls his own string without warning. Now, you realize it’s time to pull the string. As Roy glides safely down, your parachute begins to deploy but it’s too late as you thump on the ground.
Timing is everything. when a guru says don’t try to follow his trades, and that day trading is risky, and that you as his students will lose money, I say you better listen because he knows these things to be fat. They know they can’t make money unless the students lose money. The guru would not be able to make money without a following. If there were no volume behind their calls to buy, to push the stock higher, then they would not be profitable.
Without thousands of people following their calls there is no edge. Their edge is calling entries for thousands of people then being first to exit. Everything these gurus say is true because they understand human psychology. They know that if they make money right in front of you, then you will follow them. They know that mentioning entries, you know, they’ll enter at those levels and so will their followers. They know their entry calls will make the stock rise. They know they can make profits if they exit before everyone else. They know to keep followers focused on entries while they make the early exit. They know not to call out even a mention of the possibility of an exit until they are already out.
This brings me to scam #2. The guru knows that most people, I would say well over 95%, that day trade lose money. Yet the student is watching the guru make money right in front of them. So the guru is credible in their eyes and the potential student believes the guru has the magic formula for success.
Next comes the course on how to day trade. Which is repackaged material that can be found free all across Youtube. And there’s nothing proprietary in the course, but even after the course and watching the guru make money, the student still loses money. But the instructor says day traders lose money and that they, the guru, are the exception. And to be like them, it just takes time.
Next comes the thousands of dollars for the subscription plan. The guru tells the student you’ll get there, you just need to keep learning. In other words, it is the student’s fault that day trading is not working for them. All the student needs to do is put in more time and the guru never gives out any black and white rules. It’s all subjective.
So when you follow a set of rules the guru says “well yeah you did a good job following rule 1 through 30 but you missed rule number 179.” And then if you look at rule 179 and it contradicts rule number 7. So there never really is a true rule set to follow and the gurus always have an excuse to keep you subscribed.
Now not only are you losing money day trading because you believe scam #1, that the guru is legitimately making money day trading, you’re getting double scam by paying thousands in subscriptions for a rabbit hole of information that will never lead you to be a profitable trader. The guru knows that when people day trade with him they lose money. The guru offers students education as a solution. They know that the longer the student tries to figure out why they’re losing money, the longer they will stay subscribed to the service. These gurus understand and use “the keep on, trying keep on buying” business model. And this is a profitable model being deployed by many many gurus.
Now these guys are able to scam their students in two ways. One, through having them follow them into trades that they take the early exit and front run them; and second, they take money from the students as they blame them for losing money and the answer is more time subscribed. Bottom line, is these guys make money day trading with an edge. Their students don’t have an edge. In fact, it’s just the opposite as the students are the victims of the edge.
These gurus make a lot of money and I don’t think it is illegal, because as long as they keep putting out the disclaimer that day trading is risky and don’t follow their trades, they’re actually legally covered. I hope this video made it more easy to understand and recognize this scrupulous business model. And that I can help people stay away.
If you’re a trader looking for trading consistency; if you keep changing your approach and looking to add one more rule that will get you over the top, I’m going to help you for free. Stay with me for the next minute or so.
Now who am I to make this claim, my name is Karl Domm, Karl with a “K”, and it took me over 20 years to finally succeed to become a profitable options trader. I did that around 2015 and I have publicly proven to be a profitable trader since I started sharing my P&L on my Youtube channel in May of 2019.
Now, my larger options trading account started with $110,000 and now is worth over $165,000 and I’m the only Youtube instructor that shares my daily P&L proving that I am a profitable options trader. Now I’ve asked many other instructors to share their P&L, but they don’t because they can’t because they actually lose money trading. And I’m frustrated with the lies being told.
If you’ve ever taken an online training course, I’m 99% sure that you’re frustrated and that you’ve lost money following these instructors. And you already know that they don’t share their P&L. Now as far as trading myself, I just happen to have a passion for options trading. And I spent over 27 years learning and trading. And I’m not necessarily interested in the technical aspects of options from a scholastic point of view, I’ve been passionate about the most efficient way options can make me money. And this is my calling in life, as corny as that sounds. And I’ve even written a book on the subject, even though I hate writing. For some reason trading ideas just flow into my head all the time. And I take those ideas and I spend hours and hours back-testing.
Then in 2017, I discovered a great course which taught me a specific trade structure which I’ve been able to mold and create specific rules around and capitalize on, but the problem is that it requires a special margin account and a lot of capital to be traded. So I set out to duplicate this trade structure in a way that could be done in a small account. And after back-testing over 300 ideas, one of the trades I developed was a trade that I call The 2060.
This is a proprietary trade I developed almost from scratch. I initially created the course to sell it and I wanted to compete with these other Youtubers that were frustrating me with their fake claims. But what I’ve decided is I want to do what it takes to expose those Youtube fake gurus. And if I can offer something for free that is vastly superior to their paid products, maybe I could put a dent in their business which in effect would be using my talents to help people.
Because of this, I’m currently providing the 2060 course at no cost. And this is a full course. It’s not a worthless free report or some piece of useless non-actionable information. This is a full course with black and white rules. Rules that you can use to take action and learn how profitable options traders trade. This course is worth $495, but I’m giving it away today for free.
See the link in the description to sign up for the course.
LINKS MENTIONED:
Link to my FREE Proprietary Trading Course
