Right now, I am working in an organization which provides Online Marketing services and Data Center Solutions. I am the Online Marketing manager and Senior Content Developer.
Recently, we have been approached by a company which provides daily trading tips via SMS. They have their own team of researchers who study the stock market and blast out SMSs to their paid subscribers informing them the stocks to buy or sell. 
They want us to do Online Marketing for them.
Now, our Marketing head has asked me to research this business and find out:
– How scalable this business actually is?
– Will serious investors opt for such paid program?
– It has to do something with Intra-day trading.. Is it bad?
– Can I recommend this service to my dad, my uncle?
I have very limited experience of stock market and investment matters., hence this request for help. Basically, I want to know that whether our company should pick this project or not?
Any help would be highly appreciated!
Sridhar V
Hi Mohul,
I’ve worked in the finance/investment field and also have been on the customer/investor side. Let me share my personal views below (you may not fully agree with me):-
– How scalable this business actually is?
Given the availability of technology like email/SMS this is scalable to reach more leads/customers. However, its not trusted by many. People still trust brick and mortar or online brokerages more than the tips providers (like Nifty Direct).
– Will serious investors opt for such paid program?
No. Serious/informed investors will do a lot of homework and use research available, and finally take their own decisions.
– It has to do something with Intra-day trading.. Is it bad?
Yes the focus is more on trading tips which are for short term and frequent in nature. This drives more business. Though there are investment tips, serious investors will not trust this service. Good/bad is a subjective thing – but in my personal view I would advise people avoid such services (however, there could be genuine or good or professional players too which I cant deny)
– Can I recommend this service to my dad, my uncle?
If you are asking my opinion, I would say ‘Dont recommend’. If I recommend this to my dad, his response is “If this co. is confident of making 30% on this stock in 6 months, why are they not buying that stock in bulk and making profit…..instead why are they charging 4000 per month, 20 k per year, etc.” The logic is like this – a company/investor who claims to provide 30-40% p.a. will not be revealing their formula to make money out of it….instead they will use it themselves (like the Warren Buffets, JhunJhunwala and others).
These are my personal views. You can take a call. Business-wise it might still be a good proposition, but I’m not sure about the trust factor or long-term connection with investors.
Mohul Ghosh
Thanks a lot for your reply.
In short, such daily trading system is same as gambling.. you can either make it big or lose it all.. In that case, I dont think serious investors will buy this concept. And thus, scalablity will always be the issue. Negative from my side.
Thanks a lot for the clarifications, Sridhar.. !
Saurabh Gakhar
Hey Mohul,
You are anyways clear on it but having spent more than 8 years in stock markets i would like to vote negative on this idea. One should not suggest intraday even to his/her enemies, forget dad or uncle :D…anyways whats big G upto these days??