Soluskro

7 Comments

    • The Long Case for ThinkorSwim Group [view article]
      Mephistopholes,
      Thanks for the clarification of your position... I think.
      I'll have to think about it because your angle is about the most unique I've heard in awhile.
      I'm fully aware of the bear case based on calling for Lee and Ida's heads on a pike and to tar and feather Deferred accounting and much of the BOD.
      And most people call for the abolition of the Education alltogether, using the shady feel of the infomercial as an achiles heel and the recent SEC inquiry as proof positive that it is poison...
      But you seem to actually want to go back to a focus on the investor education? Yes? No?

      Seems to me the basic stocks and options educated got what they paid for and need no further hand holding-- I mean, those courses are, well, "basic". They get a Covered call teaser but that's about it. Any further pursuits would put them squarely in options country, and right into the TOS wheelhouse. So how are these 275K students abandoned?

      Believe me, I have some problems with Lee and the way he has communicated by "res Ipsa Loquitor" which is great if you are Hunter S. Thompson but not when the Big Institutional money wants a simple digestable story fed to them-- not an arrogant "You boys will come around someday" approach.
      And Deferred accounting, the darling stepchild of Ida Kane should be choked to death (Deferred Acctg-- NOT Ida!) which will bring much bigger coverage.

      Other than those issues, the stock and business model look about as perfect as you can get. At least to me.

      Again, thanks for your thoughtful response and some clarification. At worst you've given me some new angles to analyze and ponder.

      Best,
      Sol       Jun 11 10:36 PM
    • The Long Case for ThinkorSwim Group [view article]
      Mephostophles,
      You provide exactly the case study I was talking about.
      Your premise that the education side is a scam to bilk the near broke and suck their accounts dry doesn't hold water.
      The pipeline of Investools students to TOS account users remains strong and robust and for over 2 years now, TOS has maintained accounts averaging over 40K with extremely low churn.

      If what you say is true, the "broke dupes" from Investools would act as a revolving door. Hasn't happened despite all the wishes of SWIM's competitors and the Bears.

      If TOS has lost it's usefulness as you claim (Barron's will catch on, right?) then please explain the last 6 months, where 11,800 accounts have left OXPS, Schwab, Scotttrade, Etrade, TD, Nat'l Fin Serv, Merrill, Citi etc for TOS?
      And the number headed out the doors of TOS for those much more "logical and best practiced platforms" that those same competitors have become "keen on"?
      Try 844.
      Those 275K active Investools students have logged approx 17 complaints. Maybe a handful are too embarrassed to complain, but the picture is not as you say. The overwhelming majority are satisfied with learning and trading. At a minimum and on the whole, the students realize they are no worse off than they were had they not taken the education.
      Of course, this can't be proven but neither can your thesis-- so we're left with looking at the picture from 30,000 feet. And my thesis appears much more to be the case based on the complaint ratio and the pipeline to TOS facts.

      Your post has a few kernals of truth and is written with the finest Kings English but overall, it's a fluffy hit piece filled with many many holes.

      Best,
      Sol
      Jun 11 08:48 AM
    • The Long Case for ThinkorSwim Group [view article]
      Chungst,
      Curious why such a dramatic 180 shift in opinion on TOS.
      You certainly have made some well thought out posts in the past in reply to Seeking Alpha articles on SWIM and you were quite the defender.
      Now granted, things have changed but your outlook seems much less analytical. Most Bulls that I know that shifted to Bearish stance have done so but don't seem to disregard the company as much as you do (now) and are more irked at Lee and some missed opportunities rather than the company itself.

      In anycase, one of the points that Bulls made (make) on TOS is the quality of accounts vis a vis the demographics.
      The short case has been to speak to the impossibility to keep the integrity of these accounts and the volume of trades without adding less desirable accounts that wil burn out.
      This is indeed a valid point to raise and one that has puzzled both bears and bulls alike. It just doesn't seem to play out the way it should.
      The average accounts remain above 40K. The Annual avg trades per remain above 180 and the churn hovers around 7%.
      TOS is pillaging competitors at a 14:1 ratio (nearly 12,000 accounts taken away from OXPS, Schwab, TD, Etrade etc in 6 months).

      In other words, this thesis on account degradation has been about as accurate over the past two years as the guy on the corner wearing a sandwhich board saying "The end of the world is here, repent".

      And this has been consistent even through these tremendously volatile and somewhat recessionary times. The novices are supposed to be wiped out, the amatuers are supposed to go to cash and hide. They haven't.
      At some point-- and I'll grant you that it may take a long time (1 year? 2?)-- the street will wake up to this fact. Heck, by then, the thesis may become more true than false and the insane growth will have slowed and the opportunity for explosive price per share growth squandered-- but until we start seeing it, I'll stay Long.

      Best,
      Sol       Jun 10 10:52 PM
    • INVESTools: Swim And Sink [view article]
      I think your pulling a bait and switch here...
      Your guy=$500.
      Investools=$999 and for that, you get the two day seminar PLUS 6 months of the toolbox use.

      The 24K is the PHD program and I can gaurantee you that your buddy, InvestorJim can't possibly get that in depth in a two day seminar.

      Just so you and the readers of your post are comparing apples to apples. You are NOT "saving 10K-20K" with your two day seminar.
      You *might* be saving a few hundred bucks.

      But The tools subscription alone is worth the entire $999.
      And while you can get most of the the tools for free, good luck sorting and parsing the data.
      It would take days or weeks to run searches AND do the analysis that takes minutes with the toolbox.

      But you are right-- people should shop and choose what works best for them       Feb 01 06:18 PM
    • The Short Case on INVESTools [view article]
      "do you have any thoughts of the impact of possible customers who are dissatisfied with the Investools product and the affect it will have on future growth for Investools going forward? It seems that reviews for the product are mixed based on comments I have read on discussion boards, with some students very satisfied with the company's products, including yourself, while others haven't been as successful"

      I can comment on this. I have pored through the same comments and observations for over two years. Before I signed with Investools (similar to Chungst, I paid the initial pricetag to get the tools themselves) I wanted to do my own due dili on if this was a shlocky, glorified Amway or "timeshare" sell.

      So far the conclusion I have gleaned from the many comments of dissatisfaction come from people who are griping over the price or that they can find various similar tools "for free" scattered across the web. I.E. My anecdotal observation is that the vast majority of comments and posts have never tried the tools at all.

      I gave up posting defenses of the tools long ago. I agree with Chungst in that trying to convince people who have no real understanding of what they are commenting on is a fools errand.

      I know of at least 6 people personally with Investools and all are satisfied and remain subscribers.

      Personally, I can attest to having more than made back my money spent. I consider myself a novice in the big dog eat dog world of investing and I have done quite well with using the tools to verify my stock picks and my option plays.

      With Stocks, I am generally a buy and hold type.
      Directly attributing the the tools searches for stocks, I have made the following returns (as of Friday 12/21 in cases of holds):
      1) 12% (entered 9/06)
      2) 19% (entered 9/06)
      3) (5%) (entered 10/07)
      4) 108% (entered 5/07, sold 9/07)
      5) 18% (entered 3/07)

      Not to mention the uncalcuable savings from some stocks I liked that the tools convinced me were NOT correct plays. (I always enjoy running Cramer's BUY BUY BUY Bu bu bu BOOYAH stocks through the tools. Heh)

      I only recently jumped into options (after papertrading for some time to get comfortable). In the last 45 days I have made 16 option plays and seen total returns of 53%.
      I have been trading options for... 45 days.

      As for SWIM itself, I have held a long position for over two years (we know how that position has worked out!).
      I have studied every piece of information on this company and I won't be selling my stake anytime soon.
      I find it almost comical how every negative article focuses on SWIM as an education company. These articles read (to the informed) like they were written in 2004.
      I have scores of analyst reports that discounted the education side almost completely for the remainder of 2007 and 2008 (these were from March 07) when making their valuations-- which have since been corrected as even these well known analysts have had to concede that the edu side is back on track and firing on all cylinders.
      The TOS side is so hot right now that any article not focused almost entirely on the incredible metrics should be dismissed almost immediately.

      Bottom line, Investools students are very faithful and happy. There are a few unhappy students who perhaps aren't cut out for investing or entered into the tools with the wrong mindset (lead into gold types).
      I attend the preview seminar occasionally to "watch my own investment" and make sure that they aren't exaggerating or making false claims. I am always amused at what some people *think* they heard (Investools told me I could make 80% in three months!" These are patent lies-- on the part of disgruntled posters.

      Hope that sheds some light.

      Soluskro       Dec 23 11:18 PM
    • Investools: Too Many Accounting Red Flags [view article]
      "In some respects, Investools is no more than a glorified Seminar company (save for its online brokerage business)!"

      This is where a reader might insert his own mental "but" as in: "but what I am about to read may have been pertinent if the article was written circa 2005".

      Briefly, the Education side has been heavily discounted by analysts.
      Back in May07, this is what MCF had to say:

      "In our new estimates, we made deep cuts in the contribution
      from the indirect marketing channels to assume no recovery during the rest of FY07 nor in FY08."

      This is when the sum of the parts analysis (focusing on the brokerage side-- so in MOST respects, SWIM is now a brokerage business) called for $16-20.

      BMO in August07 had this to say:
      Accounting for the company’s education segment revenues and expenses creates confusion about that segment’s results and generates GAAP losses on the consolidated company’s income
      statements. That is bound to create some impact on valuation, simply because the accounting is not as clean as some brokerage competitors. However, we believe the cash flow generation and
      adjusted earnings are more representative of Investools’ true underlying performance, consequently our analysis and recommendation take those metrics into account as well; both are
      likely to accelerate meaningfully over the next couple years and are the key drivers of our
      OUTPERFORM rating."

      Misunderstood. Hmm. MCF has recently updated their targets to $19-23, not just because of the explosive TOS side growth but because the educational side, which was already heavily discounted by most, has seen renewed growth under the new pricing strategy. Seems that reports of the death of the edu side for all of 2007 and 2008 was premature.

      On the broker side, you should take a moment to do some metrics comparisons with some of SWIM's competitors and you will clearly see the reason for the premium.

      Overall, I do think you get some things right and you do provide a balanced view on things like the complaints and rebuttal. I just think the focus of the article is incorrect with respect to where or why someone might invest in this company. The edu side is not the story. It's the brokerage side which merits an article.

      Regards,
      Ed

      Full disclosure: I am not affiliated in anyway with Investools. I do have a LONG position since 2005 and I have used the toolbox since 2005.



      Dec 17 11:56 AM
    • INVESTools: Swim And Sink [view article]
      "The company is making absurd promises (see "Avoiding the Charlatans") that students who attend its seminars and use its pricey software will destroy the market in no time."

      There are 250K grads. If all these grads had 100K to invest (a stretch), consider the impact on the market.
      Your claim is absurd.

      "Some of the testimonials even make claims of outrageous 800%+ profits in just two weeks!"

      Take that with a grain of salt. It's possible. You could get lucky as heck and turn $100 into 900.
      But use some common sense. (and any buyer of the tools.education should use common sense too).
      I don't for a minute think that someone turned 100K into a million. Sheesh.

      "The software and “education” are based on a system of just “following the red and green arrows” that indicate by technical signals when to buy and sell."

      This is not true. The red/green signals are indeed part of the hook, but I have the tools and I barely even look at the arrows as my be-all end-all of buy and sell signals. Though they make good indicators (see below)

      "That’s it. No research, no bothersome accounting to learn, no money to start, no problems!"

      Another false statement.

      The education and tools is ALL about resarch. What the toolbox offers is the ability to research in minutes what can take hours (days or weeks).
      I loved the classes and learned quite a bit about the market. The real gem with Investools is the tools themselves.
      So how have I fared? I have some trades that have yielded over 15%. Others which are struggling at a few %. And I have some dogs.
      However, the tools and education has saved me from making some big mistakes. Some stocks I was looking at I have avoided because of the tools. Some would have cost me dearly.

      Before signing up with Investools I did a LOT of research on the company. I looked far and wide on the web for comments and testimonials. Because I am a skeptic at heart, I wanted to be talked OUT of signing up and paying thousands of dollars.
      What I found was the majority of discussion were mostly postings by people bitching abbout the price and knocking the Tools and education without ever trying them.
      Ironic that you fall squarely in this category.

      I can say I have covered my tuition with trades I made with Investools. My biggest gains though have been by becoming a shareholder of Investools (and since they have some tricky accounting, even their best searches don't yield SWIM as a top stock under many various prebuilt searches).

      While I have thouroughly enjoyed the Technical education and the options, I am a fundamental guy at heart (and more of an Intermediate to long term investor).
      I was so impressed with the company after listening in to some of the conference calls that I was sold on the company and what they are trying to acheive. So I have a nice nut tied up with SWIM and have (currently) a 111% gain (even after the recent 18% haircut due to the market slide).

      Where I will agree with you is on the perception of the sales pitch. I blanche at Infomercials and I wish they didn't have them at all. I think that is the only weak point because as a skeptic, I see that as shlocky.

      Bottom line, I am quite satisfied with the education and extremely satisfied with the toolbox. You can get some of the tool components (like those bubblegum red and green arrows) on free sites. And if that suits you, that's great. But you will be pouring hours in to research that you don't have to with the tools. The $600 price tag on the toolbox is well worth it. As for the education-- I have really stepped up my knowledge of the markets and I really enjoy plugging in stocks that a guy like Cramer "Booyah's" every night and laughing at what bad advice he's touting.
      On the otherhand, I am not Cramer and my strategy is different. I think that is the greatest chasm to cross when discussing any stock. Message boards can be deadly because one person may have a preset strategy and be trading for the hour or day whereas a buy and hold guy will get shellacked following what the day trader is trying to do.

      Frankly, I find your thesis that a lack of BBB or ripoff report (or whatever) complaints is due to the fact that people rarely make them-- or they take time to show up-- is disingenuous because it's unprovable.
      Basically you are trying to prove the company sucks and you use a LACK of real complaints (from people who used the tools) as a positve proof that your thesis is correct. That's bizarre.
      The complaints you did post are mixed at best. I am certainly willing to entertain that Investools is not for everyone. And as I'm sure you are aware, trading and investing requires emotional discipline. Some people lack that and no amount of money can teach it. You have it or you don't.

      I think many people are looking for a "turn lead into gold" quick fix. Like joining a gym, you can pay for a full service sports club with all the amenities and personal training and still fail if you don't commit.

      There are some out there who have so much discipline all they need are a few books and discount brokerage account and they are off to the races.

      It all depends on your situation.

      Incidentally, if you were following those "red and green arrows" you would have bought SWIM (formerly IEDU) at $8 in September, bought more (or just held) in January at $12.50 and sold your position around $15 in March.
      Of course, you might not have acted because both times there was a "phantom green" (something you learn in basic stocks course).

      So short away and backup your thesis. I think you'll be sorry-- or maybe you won't.       Mar 14 10:44 PM
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