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Safely surf the wave of articles with hot stock picks.

 The market is on fire and more people are writing about their hot stock picks. How can you tell if they are written to inform you or if they are written to lead you where they want you to goMany of the articles I read on the internet seem to only include rationale to support the author's position. The articles rarely include rationale against the author's position. What has happened to playing The Devil's Advocate when writing an article?

 I read an article published today from an author who has 60,556 followers on seekingalpha.com. His hot stock tip was Winstar Resources (WIXFF.PK), of which he currently owned stock. He made an attractive plea why his pick could produce a substantial return on investment due to an oil well located in Tunisia. However, he failed to mention anything about the political problems and the riots that are currently ongoing in Tunisia. Furthermore, he made no mention that (WIXFF.PK) has a very low trade volume which would inhibit an opportunity to quickly sell the stock in case it rapidly turned negative. In all fairness to the author, it is extremely difficult to cover every angle in one article and he did give some words of caution. But leaving out such critical information is reason for concern. Obviously, we should all do our own research before investing in a stock but it sure would make it easier if the author had provided a "Devils Advocate Paragraph."

  Every article with a recommendation to buy a stock has a critical juncture wherein the author is trying to sell their point of view to the reader. This is the point when we are most vulnerable of becoming emotionally inclined to accept the author's advice. Here is a simple tip that keeps me from getting too caught up in the author's hype. When I find a title that peaks my interest, the first thing I do is scroll to the bottom of the article in order to see if the author has any financial interest in the companies that will be written about. This allows me to be informed of that fact before I start to read their spill on the what, where, and why. Informing myself of the authors financial ties prior to reading an article rather than after, better prepares me to keep things in perspective at the critical juncture of the article.

 Devils Advocate Paragraph: Heeding my advice may prevent one from actively reading an article if they know the author has a financial interest in any of the companies. This could prevent one from gaining valuable knowledge that they may not acquire elsewhere. However, knowing the author's position prior to reading the article may prevent one from riding a wave of emotion that could slam them into the rocks.

 I have no positions in the stock mentioned. I have no interest in buying or selling the stock mentioned within the next three market trading days.
 


Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.