Wall Street Money Machine, Volume 1

Quite frankly, I expected far more bashing and 1 stars than what appears here.

Wade takes on the establishment and steps on some Big Toes on Wall Street. Mr Cook tells it like it is and shakes up the industry—and that is GREAT!

Buy this book and use the strategies. They work. Forget the naysayers who are trying to use your ignorance for their bliss and don’t want Wades methods known.
Rating: 5 / 5

Have you ever had one of those “AHA” moments, like being hit with a thunderbolt and you say; “So this is how it’s done!”That is exactly what happened to me when I read this fantastic book by Wade Cook. AHA! Violla! Walla! Cha-Cha-Change! Thanks for getting me on the right path to making money Wade. This family will be forever grateful.
Rating: 5 / 5

The pluses of this book have been reviewed elsewhere. If you buy only one book on how to do short-term investing, this should be it. The strategies, in particular rolling stock and covered calls are very sound and if practiced carefully should make money for you 80% of the time. However, you must be careful because he makes it sound easier than it really is. Interpretting charts is much more complicated than simply looking for a “rolling” pattern. Stocks usually drop for a reason, and to think they can’t drop any further is a recipe for failure. His strategies on stock splits are not necessarily sound either. In the short term, many stocks that are splitting do drop significantly in price. A split by itself is not sufficient reason to buy unless you are in it for the long term, and is a particularly dangerous reason to buy options which will likely expire before the stock has benefited from the split.

He is also wrong that the “premium” for options on low cost stocks is pretty much the same as in more expensive stocks. Don’t believe me? Check out the prices of call options on any high priced internet stock. You could easily be paying a 15 -20 dollar premium on options just a month out.

Most disappointing on this “revised” edition is that Mr. Cook seems to be living in the past as to how stocks (and options) are bought and sold. On-line trading is hardly talked about – he assumes you will always be “calling your broker” and relying on him/her for prices. Great way to always get into a position late and at a bad price. And, in particular for NASDAQ stocks, why would you buy at market instead of using limit orders? A market order carries huge risks, particularly in fast moving stocks. In the case of NASDAQ, one can almost always buy at the bid and sell at the ask. In those cases that are exceptions – yes – a market order guarantees getting filled, but also will likely guarantee getting filled at the very worst possible price. Wise advice is that if the only way to get into the stock is with a market order, it’s not a safe trade.

Options, on the other had, are the opposite. Mr. Cook completely fails to discuss the lack of liquidity that exists with most option contracts. Unlike stocks, you are usually stuck with the bid/ask spreads on options and very often, that spread is so wide that it is virtually guaranteed you will lose money. Remember, you have to make back that spread plus all commissions just to break even.

Selecting options and placing a proper value on them are complex sciences that Mr. Cook ignores entirely. Just because options are available on a particular stock hardly means it’s a good thing to buy or sell.

He is wrong to say commissions don’t matter – espcially in option trading where, contrary to what he says, commissions are usually MORE than for stocks, often much more. Commissions can be truly exhorbitant when doing spreads, a strategy he lists as his very favorite. Commissions in reality make it difficult to trade the majority of option contracts, including covered calls, unless you have a substantial position.

I was disappointed that he did not truly update this book to reflect the new internet age. It is also somewhat annoying that he so blatantly advertises his seminars, but then, he also owns the publishing company that puts out this book so it’s not surprising. It’s also not a reason to avoid the book. Just beware that much of what he says is self-serving.

This is mostly a negative review, but I still give the book 5 stars because it will educate you generally on a variety of strategies not discussed in any other books. For that, I consider the book to be worth its weight in gold. Anyone contemplating an active participation in the stock market should read this book. Just don’t follow him blindly.
Rating: 5 / 5

Okay, I read the original edition in 1996 or 1997 and it started me down the trail of options trading. Thank you Wade! I prefer to write covered calls, although I do all types of options. The covered calls are a money machine. If you have just a little capital and grasp the concept you can retire in 5 years or less doing covered calls on a stock that splits often and appreciates. My personal favorite is CMGI. Covered calls are SAFER THAN JUST OWNING THE STOCK BY ITSELF! It will generate you monthly income for the rest of your life.

Consider this book a motivational guide and not the last word on option trading. I was so fired up after reading his book that I couldn’t wait to start accumulating stock to write covered calls.

If this book interests you then try “Options as a Strategic Investment” by Larry McMillan for the more technical aspects of option trading. This is the bible for options traders.

Some of these negative reviewers have never read the book or traded a single option I suspect. The book is not designed to teach you how to “pick stocks” or to never have a losing trade. People lose money in options because they are greedy. That is always the case when I lose.

I took the time to write a review just because I appreciate Wade introducing me to options trading that was easy to understand and will make me rich in a few years. Anyway, read the book. It will change your investing life.
Rating: 5 / 5

Wall Street Money Machine Vol 1 is an excellent book to teach you how to cash flow the market….and from someone who knows—WADE COOK!I noticed that Wade’s brokerage account showed a 22% gain this year.Perhaps that explains why the 1 star reviews have suddenly dissappeared.Looks like Wade has shut his detractors up once and for all. Way to go Wade!
Rating: 5 / 5