Stock Forex

Faced with time and financial freedom, I ended up writ­ing a book. I never did go back to college to get my teaching degree, but I did end up with a book in the bookstores. Since that time, I have written several more. I entered the lecture circuit and started traveling the country. My semiretired state was really becoming a fun career. This also gave me the opportunity to make more money.

I knew I didn’t want to put the excess money into savings accounts. I did buy a lot of second mortgages, which kept my cash flow ever increasing. In addition, $5,000 here and $10,000 there went into stock market investments.

I opened up a brokerage account and bought mutual funds, one of which had gone up in value 14% each of the previous three years. As soon as I bought it, it went down 2%. Quite a few stocks went up in value, but most of them floundered around and many went down. I figured the stock market was not for me, because I was going to have to learn a whole new set of rules and vocabulary to be successful at it. Meanwhile, I was still involved with real estate and teaching seminars.

Then I got a call from a friend who at that time was a stockbroker. He wanted to take me to lunch and explain what he was doing with many of his clients.

At lunch that day, I listened to a most fascinating idea, which struck a responsive chord telling me it was right and true, especially at that time. He wanted me to buy 100 shares of Motorola stock. (I don’t do this with Motorola any more. The stock started to climb up to $100 a share and has since had a two-for-one split. The stock went back down to $50 and is now trading at around $70 a share. Maybe it will roll again, but I am just not sure.)

I bought 100 shares of Motorola at $50 a share for $5,000 plus $80 in commissions. The stockbroker asked me to put the stock up for sale at $60. Those of you who are familiar with the stock market and have brokerage accounts realize that you can put an order in to sell and take off for Hawaii. If, and when, the stock hits $60 a share, the sale will be triggered automatically by computer.

I put in the order to sell at $60 a share. About six weeks later, the stock hit $60 and the computer sold it. I had $6,000 in my account, minus about $90 in commissions. I made about $830 profit on this transaction. Then the stockbroker said to put in an order to buy the stock again at $50 a share. I put in an order for 108 shares at $50. About five weeks later the stock rolled backed down to $50 and the computer triggered a buy. Now I was the owner of 108 shares of Motorola at $50 a share.

At that time, the stock dropped down to around $48 or $49, and I was getting kind of worried. But it climbed right back up to $60 a share and the computer triggered a sale again. I had the excess profit in my account. The stock rolled from $50 to $60 a share several times and kept climbing up to $61to $62, so I did miss out on some of the profits. I did this particular stock many times for several years.

This cab driver had found a way to do a meter drop on Wall Street.

I contend that the stock market makes a perfect home-based business and/or a perfect place to develop extra income even if you are working or relying on an existing business. I am convinced that in every respect and aspect it is far superior to most other businesses. I have had a lot of businesses, from one-man shows to a large (in my estimation) 300+ employee corpo­ration. Currently I am Director and President of Profit Financial Corporation—whose main subsidiary, Wade Cook Seminars, Inc., is a powerhouse.

I have taken years to build the business and took it public in May of 1995.1 only bring this up because I have employees, payroll taxes, advertising, and every other outlay of cash as well as concerns and considerations associated with running a large business. At times the “busyness” gets in the way of my true loves: family, teaching and working the brokerage accounts. I have tried to blend them together. I do owe an allegiance to my shareholders to be profitable. I have to make public how I work my stock and option deals in the corporate account. It is fun, profitable, and is building a tidy fortune for my immediate family (wife and children) and my share­holder family.

I realize that as I make a case for treating the stock market like a business, that I am competing with every “Amway” type company out there. My story is different though, be­cause I am not inviting you to join my “downline.” I want you to make a ton of bucks and keep ALL of them. I judge my success as an educator, not by how much I put into people but how much they get out of it. The business comparison can go a long way because you are probably familiar with most aspects (whether you are actually experienced or not) of running a business. Indeed, being familiar with what it takes to be successful may have caused you to get into business. We will dispel some falsehoods in a most unusual way. I will approach the comparison of using the stock market as a business by first stating the we are going to take a totally unconventional approach to creating a stock market income portfolio.