Example #1: As you know I follow insider trading very closely, and 2002 still presented investors with some unbelievable buying opportunities. I notice that a Director from Ford Motor Company was buying the company stock at depressed prices, in the open market. This wasn稚 your ordinary director however; this was Richard Manoogian, Chairman of the Board of the Masco Corporation, and a member of the Forbes billionaire list. Richard is a very savvy investor, and when I see him buy, my interest immediately peaks.

After doing my own research, I found that Ford stock was not only severely depressed, but the company's board of directors was a virtual who痴 who of political power in America. Besides Manoogian, former treasury secretary Robert Rubin was on the board. I started recommending Ford to my clients.

The next day my branch manager came into my office and demanded to know why I was recommending Ford stock when the company痴 analyst had a reduce rating on the stock. I told him that I thought the analyst was wrong. He handed me a scathing letter from the compliance department that I had broken a firm policy by recommending Ford stock to my clients when the firm (UBS) had a reduce rating.

I had to fill out a form for the compliance department, and give a lengthy explanation as to why I had committed such an egregious act. As I wrote my explanation I became angrier and angrier, and my final sentence read, 妬f I had a choice of listening to the analyst, or following the lead of someone on the Forbes billionaire list, I would follow the billionaire any day of the week�. Boy that didn稚 go over well. Oh, by the way, the stock went from $7.50 to $15, a 100% return. Huh, I guess the billionaire was right.

Example #2: After my near career ending experience with the Ford incident, I became very gun shy about recommending 途educe� rated stocks to my clients. Knowing I wanted to get the hell away from this firm, I thought I would irritate them a little by buying a few reduce rated stocks in my own account. Don稚 get me wrong, I do not buy stocks without doing my own research first.

In November 2002, I began to see large insider purchases of Advanced Micro Devices by the company痴 chairman, WJ Sanders. Sanders bought 300,000 shares of AMD at $6.87 per share. I immediately got interested so I bought some. A couple of weeks later the President and CEO of AMD bought 20000 shares at $6.19. I bought some more.

The sad part of this story is I couldn稚 recommend the stock to my clients because the firms analyst had a reduce rating on the stock.. In less than a year the stock doubled, and I made 100% on my investment. Today, the stock is trading at $33.

Sorry big brokerage firm client, you missed out again, and the sad part is, you didn稚 even know it.

Example #3: To show you that poor advice was not reserved for 2002, I want to take you back to 1992. I began to have serious doubts about the quality of the advice Wall Street firms gave their brokers, and subsequently, to their clients. In September 1992, IBM was trading at $82 per share. A 都trong buy� rating was given to the stock by the analysts at the firm where I was employed (A.G.Edwards). From September of �92 to September �93 the stock fell from $82 to $42. As IBM reached the bottom, the analyst issued a 都ell� recommendation claiming IBM was done for. Moreover, brokers in my office were clamoring about the demise of 釘ig Blue�.

Shortly after the 都ell� recommendation was issued, IBM began to climb. One of my clients, who previously never bought a stock from me (because he was so conservative), called and bought some IBM. After telling my client what the analyst痴 opinion was on IBM, he said he didn稚 care what the analyst had to say, and to buy the stock.

By the end of 1993, IBM was trading at $56.50, 14 ｽ points higher than the September low of $42. In December 1994, IBM was at $73.50, and by December 1996 the stock rocketed to $155.13. To add insult to injury, had the investor ignored the broker/analysts advice, and hung on to IBM through May of 1999, he would have received two, 2 for 1 splits. If the investor had sold 100 shares on the broker/analysts advice, the investor would have received $4200. In 2002, despite a horrible market downturn, those same 100 shares became 400 shares, and was worth $31,000.

CONCLUSION: If investors are truly interested in making big money in the stock market with very low risk, you have learn the secret code. After you learn the code, do you own research before you buy.

SECRET CODE:

BUY= SELL
ACCUMULATE=TAKE SOME PROFITS
HOLD= HOLD OFF ON BUYING
REDUCE= ACCUMULATE
SELL=BUY