If you’re over 50, you probably remember Dr. David Reuben’s best-selling book, “Everything You Always Wanted to Know About Sex, But We’re Afraid to Ask,” which director Woody Allen later made into a movie.
Well, Tony Ponzo and Mike Celeste, owners of Splitmaster.com, have written a just-released book, “Never Let Wall Street Steal Your Money Again,” which, while not as racy as Reuben’s book, may be just as thrilling if you’re at all familiar with the gyrations of Wall Street.
“In 2008, when the market crashed, it took so much wealth away from everybody,” said Ponzo, who along with Celeste in 1999 founded Splitmaster.com, a service that has been sharing its successful stock splitting and options trading strategies with thousands of subscribers. “We even got caught up in it. If people had some of the knowledge in this book, they might have been better able to protect themselves.”
Would they have experienced a gentler landing than nose-diving off a cliff?
“That’s right, it’s a helluva lot better getting out with a $2 loss than getting out with a $30 loss.”Ponzo said,” after the the close of the New York Stock Exchange last Thursday, which allowed the San Dimas-based day-trader to pull away from his computer screen long enough to chat about the market and his new book.
It’s a bit strange to hear Ponzo talk about losses, because the results of Splitmaster’s “Momentum Strategy,” involving “call” and “put” options in which day-traders bet whether the market or a particular stock is going up or down, have been impressive, showing triple digit returns. The strategy has never shown a loss.
Ponzo and Celeste only built and implemented their Momentum “Option” Strategy when stock-splits started drying up because of the down market the past few years. With options trading, the investor doesn’t care whether the market goes up or down as long as he has bet correctly on which way the market is going to move.
While options and even stock split strategies can be sophisticated – he’s tested their market strategies back to 1976 – Ponzo is a master at deconstructing Wall Street jargon and making it sound simple and sensible to the novice investor, taking great care to share and illustrate examples for the reader.
“’Never Let Wall Street Steal Your Money Again,’” Ponzo said, “is good for anybody, from the beginner to the more advanced trader. It teaches you how to set up an account at a brokerage, it teaches you what the terms mean and how to read charts and how to identify stocks that have been overbought and oversold.
“Of course, I’m the guy who wrote the book, so I’m going to be a little biased, Ponzo added. “One of the reasons I thought it would be different is there’s nothing out there that takes everything you need to know and puts it in one concise book.”
- Trading Basics
- Stock Fundamentals
- Technical Analysis
- Finding Stocks to Trade and More
- Option Basics
- Advanced Option Training
- Bull Market Strategies
- Bear Market Strategies
- Flat Market Strategies
At the end of each chapter, readers take a short test to help them measure how well they’ve retained the material.
“By the time you finish the book, you’re going to know options strategies,” Ponzo said. “You’re going to know how to put together strategies to limit your loss and maximize your profit. You’re going to know the pros and cons of each strategy — what can go your way and what can go against you.”
Even among experienced traders, Ponzo said that about 60 percent of options traders “don’t really understand what can go wrong.”
That’s why he suggests throughout the book that readers paper-trade before they invest, adding that many brokers will accommodate these “pretend” trades so that investors can get a sense of the real-time market and “what can really happen.”
“Don’t go out and do it; test it first so you really understand it,” Ponzo said.
“Never Let Wall Street Steal Your Money Again” is well indexed for easy referencing and is chockful of charts.
Ponzo wrote it not only to share his knowledge about stock trading but also to let people share in the daily excitement of investing. The downside is he’s awake at 5 a.m., ready to do battle.
“There’s nothing more exciting than when you get up and you’re half-asleep, and you go in there and trade and all of a sudden, boom, it really starts going your way and you make a lot of money and then you go out and take a jog. You’re filled with energy.”
Everything you want to know about trading stocks and options is in Ponzo’s and Celeste’s new book. It even answers those questions you might be afraid to ask.
For more information about Splitmasters or how to order the book, please visit www.splitmasters.com.