Every stock market investor is looking for that hot tip leading to big gain. Back in the early years of Wall Street, investors eavesdropped on restaurant conversations and literally hoped to hear what was hot on the street. Online stock trading brought all the perks stock trading to anyone, anywhere. The same problem remains, how to tell a tip from a trap.

Once you admit to trading stocks online, you will hear tips from the most amazing places. Your grandfather, the grocery clerk even the neighbor has a stock tip for you. Some tips are based on opinion while others are derived from expertise and study. The problem is how do you know which it is?

Investors also have a wealth of information from online stock trading newsletters. Some internet stock tip sources deliver up to the minute tips daily or detailed analysis weekly. Online trading companies offer information that can be used in buy/sell decisions. For traders who are not online daily, there are investor magazines and printed material to study. Today’s stock trader risks information overload from all the data available. That’s the good news and the bad news. It’s easy to get wrapped up in the research and blunt your instincts. Online stock trading is still about taking reasonable risks with no net below regardless of how much research guides the decision.

Tips from other investor and what’s gained by research are basically just the filter through which the trader evaluates decisions. Even tips from stockbrokers are not fool proof. They may be using the same investment information that amateur traders use. Tip sources for online stock trading have their own trends. Today’s “in” tip source or newsletter is “out” next week. Jumping around to find the hottest tip source easily becomes a time trap.

For the frugal investor, trading tips for stocks, options and futures are available from free online newsletters. The free tip sheets are usually a teaser promoting a book or paid subscription newsletter by a so-called expert. When the free sheets give hints without enough useful information for action, they are traps. Free tip sheets may give hints of trends or research to follow-up, the hottest advice is not likely to be given free.

Software systems claim to process stock prices and trends with lightening speed to deliver daily reports on buy and sell recommendations right to your PC. Using this process as a tip source works best if you can customize the stocks to watch to match those within your trading strategy. Otherwise, if the system only delivers pre-set stock information, it may be a time trap with minimal use for you.

Another trap is changing your online stock trading strategy to fit the latest tip. Remaining consistent with your strategy is the best way to measure effectiveness. Tip sources are quick to brag about successes. Keep your own records of online stock trading with tips and results. Only if you have confidence in the tip source is it worth adjusting your trading strategy.

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