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Frequently Asked
Questions
How long have you been in business?
How can trading stock index options reduce my capital gains tax?
Why do other websites copy you?
I am completely new to stock index options. How do I learn about them?
What is an option cycle?
Can you trade your recommendations for me?
What kind of brokerage account do I need?
What broker should I use?
Can I reinvest my profits each month?
How much money do I need
to have in my brokerage account?
How long is the average trade?
How many recommendations are given each month?
How much money do I allocate to each recommendation?
Do I need real-time stock quotes and option quotes?
Can I trade your recommendations in my IRA?
Do you ever recommend trades intraday?
Are positions ever modified or adjusted?
Are stop loss orders used?
Where are all the glowing testimonials?
Can I lose money with your service?
What time are new recommendations posted?
What happens if no recommendation is issued during a given month?
How do I exactly match the returns listed on your performance page?
What does the members area actually contain?
Do you give exact entry and exit instructions?
When is
the best time to join the service?
How many positions are open at once?
I lost my login information. Can you send it to me?
What is auto-trading?
What do I need to auto-trade?
Are there any extra fees to auto-trade?
How much money do I need to auto-trade?
How many accounts can I have auto-traded at once?
Do I have to dedicate an entire account to auto-trading?
Where can I find more auto-trading questions and answers?
Do you limit your membership size?
I still have a question not found on this page. What should I do?
How long have you been in business?
In April of 2000, a small group of people were given the opportunity
to follow our recommendations. After seven very successful
months, we decided to open an internet company to share our
recommendations with others.
Wicked Profits, LLC was formed
in November of 2000. WickedProfits.com was
opened in December of 2000.
You will probably find
no other direct competitor that has been around this long using the
same strategies we use. Almost all of our direct competitors
are simply copycat services as proved by the much shorter length of
time they have been in business.
How can
trading stock index options reduce my capital gains tax?
As you probably know,
short-term gains generated from investing in stocks and stock options
are taxed at the same rate as ordinary income.
This means any gains made
from a stock or stock option investment held for less than one year
are
categorized as short-term and are taxed at the same rate as your tax
bracket.
Any gains made from a
stock or stock option
investment held for longer than one year are categorized as long-term
and are taxed at 15% in most cases (5% if your tax
bracket is below 25%).
Gains made from
broad-based stock
index option trades are taxed differently than gains on stock
options and stocks.
Broad-based stock index options
are considered IRC Section 1256 contracts. Therefore, any
gains made on these stock index options are taxed under the 60/40 rule
which states that gains made from trading these options are
automatically treated as 60% long-term capital gain income and 40%
short-term capital gain income regardless of how long the investment
was held.
This means, even if
you only held a particular broad-based stock index option investment for 25 days (the
typical trade length for this service), 60% of the profit made from
that trade will be treated as long-term capital gain income.
Profits achieved from
stock or stock option trades lasting for the same period of time
will entirely be taxed as short-term capital gain income.
So, it is very easy to
see how trading stock index options can create a significant savings
for you, especially if you are in one of the higher tax brackets.
The above tax
information is provided for information purposes only. It may
not necessarily be accurate. You should not take the above
information as tax advice. You should consult
with your tax advisor for more details.
Why do other websites copy you?
We have been around
since 2000 and we view ourselves as an industry leader. We
believe our performance is second to none and the quality of our
service is unmatchable.
We offer an
unprecedented level of integrity, honesty, and excellence.
When we first opened,
we had very few competitors that used the same strategies we do.
However, we knew of no other company at the time that put our own
unique twist on the strategies.
Over the years,
witnessing our success, we have had customers leave us and open
their own company in an attempt to mimic our achievements.
We have also had
representatives from other companies join our company in order to
spy on us.
You will probably find
no other direct competitor that has been around as long as us.
Almost all of our direct competitors have been in business for a
much shorter length of time and are little more than copycats of
this service.
Many websites have
attempted to duplicate our success by copying text, images, the
format of our website, etc.
Almost every single
competitor's website we look at today has bits and pieces of our
service incorporated into it.
You will often see our
competitors directly copy sections of our FAQ and then change a word
here or there.
Although they may
illegally copy the exterior of our website, they cannot copy our
performance and quality.
If a competitor is
unable to create their own original content, they probably lack any
integrity whatsoever and should be avoided.
You should be very
skeptical of the past performance numbers posted on these sites
along with any other claims that are made.
I am completely new to stock index options. How do I learn about them?
Since we give you
specific, step by step instructions on how to enter our
recommendations and how to exit them, you can still trade and profit
from our service without actually understanding everything there is
to know about stock index options or the strategy we use.
Everything you need to know can be found in the members area of this site.
What is an option cycle?
An option cycle is the
third Friday of one month to the third Friday of the following month.
On this site, we will
often use month and option cycle interchangeably.
For example, one
recommendation is given per month means one recommendation is given
each option cycle.
Can you trade your recommendations for me?
We are not able to directly trade
our recommendations in your brokerage account. This practice
is reserved for registered investment advisors.
However, we do offer auto-trading
which you can read about on this FAQ in more depth.
We send each order recommended to
optionsXpress and then optionsXpress will place the order in your
account for you if you choose.
What kind of brokerage account do
I need?
You need to open a
cash or margin account with your broker
and you need to request approval to trade options.
You also need a broker that supports
the strategy we use.
You can go
here
for a list of them.
What broker should I use?
Please go
here
for the answer.
Can I reinvest my profits each month?
Yes.
Only one trade is open
at any given time so you can invest the profits from one trade into
the next.
How much money do I need
to have in my brokerage account?
Technically, you could
get going with a $1000 account at your brokerage firm but after
commissions and membership fees, you would actually lose money on
winning trades.
We suggest an account
of at least $10,000. This way, after all extra costs, you will
still make a profit on winning trades.
Ideally, having
$15,000 or more would be best but we understand not everyone has
this much risk capital.
How long is the average trade?
25 days.
All positions are closed
within 35 days of entry, win or lose, no exceptions. Positions are
never held for months or years to artificially inflate our win ratio.
How many
recommendations are given each month?
One recommendation is
given each month.
On rare occasions, the
first recommendation may not meet our entry so we may have to give
another.
However, we never give
more than one recommendation at a time nor do we ever give another
recommendation once a trade is already open.
Only one position is
open at any given time.
There are times when we
feel it is best not to enter the market due to high risk concerns.
There are also times that a given recommendation will never meet our
entry criteria (we do not chase trades).
If either situation
occurs and no recommendation can be successfully entered during any
given option cycle (third Friday of the month to third Friday of next
month) by auto-traders, your subscription to our service will be extended
30 days free of charge.
How much money do I allocate to each recommendation?
Since only one position
is open at a time, you are able to allocate 100% of
your Wicked Profits risk capital to each recommendation without having
to worry about whether or not you will have enough money to cover a
new recommendation.
This does not mean you must dedicate 100% or
that trading 100% at all times is necessary. You must decide the
amount that is right for you.
Until your profits
build, you may want to keep a cash reserve (unused cash in your
trading account) to begin so that, just
in case you experience a losing trade, you can replenish your trading
capital back up to your original investment size in the next month.
You may want to begin
with a cash reserve as high as 50% of your risk capital. Then,
after the December trade is closed, you can change your investment
size and use your profits as reserve.
If auto-trading, you should review our
auto-trade FAQ, after becoming a member, regarding how to
correctly set your auto-trade parameters in optionsXpress.
Do I need real-time stock quotes and option quotes?
No. However, our top recommended broker (optionsXpress)
will provide you this information free of charge.
Can I trade your recommendations in my IRA?
Yes. This will of course vary from broker to
broker but
optionsXpress is one firm that will allow you to trade our
recommendations in your IRA.
Do you ever recommend trades intraday?
No. All
recommended trades are given by 10 PM EST. As long as you
enter the recommended order between 10 PM EST and 9:30 AM EST the
following day, you will have the order entered in time.
Upon successful entry
of a trade, a stop loss order is given in the following day's
update by 5 AM EST. This order is not time sensitive but
should be entered as soon as possible.
Because
recommendations are not given intraday and because subscribers have
almost 12 hours to enter a new order in their brokerage account, our
service is suitable for customers in any time zone working a full
time job.
If you opt to
auto-trade, you will not be required to enter entry or exit orders
since they will be entered on your behalf by optionsXpress.
Are positions ever modified or adjusted?
No. We do not do
things like rolling over a position to the following option cycle,
closing part of a position, doubling up on a position, or closing a
position and opening up a new one in the same option cycle.
We recommend a trade
and then give a stop loss order. Either the stop loss order is
hit and the trade is closed or the trade expires in profit.
Are stop loss orders used?
Yes.
Where are all the glowing testimonials?
We do not have any
testimonials listed on this site because they serve no purpose.
We feel our performance numbers speak for themselves.
Testimonials are very
misleading to customers because while a service happily lists all
the positive testimonials, you never see them listing any of the
negative ones.
The only companies
that typically use testimonials are companies that do not show
actual past performance and instead use the testimonials to entice
you into joining the service.
This way they can hide
their bad performance while continuing to post old testimonials that
were received after profitable trades to promote the success of the
service.
Services that use
testimonials instead of showing actual performance often also
selectively post big wins on their site while neglecting to post the
big losses.
The SEC actually
forbids registered advisors from using testimonials for the reasons
we state above. Although we are not registered with the SEC
(nor are we required to), we share the same opinion as the SEC and
believe that you should simply post past performance numbers and
allow the public to decide for themselves whether or not the service
is right for them instead of trying to cherry pick certain customer
comments to mislead customers.
Can I lose money with your service?
Yes.
As with any type of
investment, you should only invest capital you can afford to lose.
The amount you choose to invest is at risk so choose your investment
amount wisely.
Investing is risky and we make no guarantees
regarding your success with our service. Past performance does
not guarantee future performance. You can lose money investing
in options. Losing trades can occur, have occurred in the past,
and will occur in the future.
Although the service has
historically done well in both bull and bear markets, it may not
continue to do so in the future so invest appropriately.
Please make sure you
review our disclaimer
and past
performance to thoroughly understand all risks involved.
What
time are new recommendations posted?
All recommended trades
are given by 10 PM EST. As long as you enter the recommended
order between 10 PM EST and 9:30 AM EST the following day, you will
have the order entered on time.
Email alerts are
sent out whenever a new recommendation is given or whenever an
important update is published.
Upon successful entry
of a trade, a stop loss order is given in the following day's
update by 5 AM EST. This order is not time sensitive but
should be entered as soon as possible.
Email alerts are not
sent out for the stop loss order since it is always posted in the
next update following successful entry.
Because
recommendations are not given intraday and because subscribers have
almost 12 hours to enter a new order in their brokerage account, our
service is suitable for customers in any time zone working a full
time job.
If you opt to
auto-trade, you will not be required to enter entry or exit orders
since they will be entered on your behalf by optionsXpress.
What happens if no recommendation is
issued during a given month?
There are times when we
feel it is best not to enter the market due to high risk concerns.
There are also times that a given recommendation will never meet our
entry criteria (we do not chase trades).
If either situation
occurs and no recommendation can be successfully entered during any
given option cycle (third Friday of the month to third Friday of next
month) by auto-traders, your subscription to our service will be extended
30 days free of charge.
We have been doing this
since the first day we opened in 2000. We usually issue
extensions about once a year.
While some of our
competitors have taken a page out of our book and state the same
policy, you will rarely find a service that actually does it because
they can't accept the idea that they won't get paid for a month.
How do I exactly match the returns listed on your performance page?
The returns listed on
the performance page are based on actual execution prices received
by auto-traders.
All customers
participating in auto-trade have their orders combined into a single
order.
When this order
executes, all auto-traders receive the same fill price. This
is the price we record for performance purposes.
Therefore, you will
have to auto-trade to make sure you always exactly match the returns
posted.
What does the members area actually contain?
The members area is updated on a daily basis.
The members area contains:
A table showing the short term, medium
term, and long term trend of each major index along with a corresponding
resistance level (if the index is in a downtrend for that timeframe)
or a corresponding support level (if the index is in an uptrend for
that timeframe).
A market commentary section with information
specific to our current recommendation and the market in general.
A recommendation table showing our recommendation
for the month.
An exit table which shows the exit point for each
recommendation.
Do you give exact entry and exit instructions?
Yes.
When
is the best time to join the service?
Anytime. Because
there can be up to a three week time frame in which a recommendation
can be given, you should join as soon as you have determined that
you want to give the service a try.
We offer a 60 day
trial to new customers so you can be sure that no matter when you
join, you will always have an opportunity to evaluate a trade from
beginning to end.
How many positions are open at once?
One.
I lost my login information. Can you send it to me?
Click
here to access your account information. You will be able to
retrieve your username and password using this method.
What is auto-trading?
Auto-trading is a
service offered by Wicked Profits in conjunction with optionsXpress.
If you opt to have your optionsXpress account auto-traded, Wicked Profits
will notify optionsXpress of every entry and exit order
recommended on this site.
optionsXpress
will then enter these orders automatically for you so that you can
save the time and effort of entering these orders yourself.
You can read more about
auto-trading on the optionsXpress website by going
here and
here.
What do I need to auto-trade?
You need an active
subscription to the Wicked Profits service and you
need a brokerage account with optionsXpress.
You must be an active
subscriber to Wicked Profits before signing up for
auto-trading through optionsXpress.
Otherwise, your
auto-trading request through optionsXpress will be declined.
Furthermore, in order
to have your optionsXpress account auto-traded, the name, home
address, and email address on your optionsXpress account must match
the information given to us when you opened your account with Wicked
Profits.
It then follows that
if you want multiple accounts auto-traded, the name, home address,
and email address on each account at optionsXpress must all be
consistent.
If, for example, you
have a subscription under Joe Smith and are currently auto-trading,
you must sign up for a new subscription to auto-trade your wife's
account under Mary Smith.
The Wicked Profits
subscriber must be listed first on a joint account.
We will not approve
auto-trading for an account whose title at optionsXpress does not
match the name on the Wicked Profits subscription.
We will not approve
auto-trading on business accounts.
If you plan on
auto-trading, please allow five business days to be approved after
completing the necessary steps with optionsXpress.
Are there any extra fees to auto-trade?
No. Neither Wicked Profits
nor optionsXpress charge any extra
fees for this service.
However, you are still
responsible for commission charges which are detailed
here.
How much money do I need to auto-trade?
optionsXpress
does not require a minimum account size to
auto-trade nor does Wicked Profits.
However, we do have
some suggestions regarding how much you should have to get started
with our service.
Please see the
question: "How much money do I need to have in my brokerage
account?"
How many accounts can I have auto-traded at once?
We will auto-trade as
many accounts as you like assuming that the conditions previously
described are all met. The conditions are discussed under the
question, "What do I need to auto-trade?"
Do I have to dedicate an entire account to auto-trading?
No. When you
configure your auto-trading parameters at optionsXpress, you decide
exactly how much of your entire account balance is used for
auto-trading with our service.
Inside the members
area, we show you exactly how to properly configure your
auto-trading parameters.
Where can I find more auto-trading questions and answers?
You can find more
commonly asked questions and answers related to auto-trading on our
auto-trading FAQ page.
However, in order to
access this page, you must have an active Wicked Profits account.
Since you must join
the Wicked Profits service before signing up for auto-trading
through optionsXpress, you will have an opportunity to thoroughly
review the auto-trading FAQ before beginning to auto-trade.
After you become a
member of Wicked Profits, go
here
for our auto-trading FAQ page.
Do you limit your membership size?
Yes. Our
service was previously closed from August 1st, 2004 to May 8th,
2005. We reserve the right to close the service again at any
time.
We feel that closing
the service at times is required in order to ensure order volume on
the recommended trades does not create execution problems.
Furthermore, in order
to maintain the highest level of customer service possible, it may
become necessary to close the service to new subscribers in order to
ensure that current customers receive the quality of service they
deserve.
We do not have a fixed
membership limit so the service can close at any time depending on
current circumstances.
Once we reach our limit, new subscribers will be
placed on a waiting list until we have an opening available.
This is not a
marketing gimmick. We have closed in the past to new customers
and will probably do it again in the future. Competitors often
talk about closing but it is hype and never occurs. It is
little more than the "join now or you may never have a chance again"
marketing ploy.
One hint that a
service's promise to close is little more than bad marketing is
giving a specific number like we are only accepting 100 customers.
It is impossible to estimate what type of trade volume will occur by
then.
By customer 50, you
may be trading too much volume or it may take until customer 250.
Most likely, after
reading this, our competitors will scramble to update their policy
to make it more believable.
I still have a question not found on this page. What should I do?
If you still cannot find an answer to your question,
try contacting us directly. You can do so by going
here.
Click below to...
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