Condor Options

This is part three in our series, [tag]Newsletter[/tag] and Trading Service [tag]Takedowns[/tag]. This week, we’re really humbled, even embarrassed. You see, we only offer one kind of service to our members; we try our best to do one thing, and do it well. But this week’s site, [tag]Iron Condor[/tag] Report, is run by a man who maintains websites offering the following things:

• dating and marriage advice
• gardening tips
• home improvement resources
• articles on … sewing.

And that’s why we’re so embarrassed: we don’t offer any of those things! If you want dating advice, you definitely shouldn’t ask us; we manage to kill every green thing we try to grow; we are only mediocre with a hammer and nails; and we have no freaking clue about needlepoint. Give the guy some credit for boldness, though: there’s a line right on his website announcing that:

If you’re like us, you’re wondering, “What is Warm Wisdom Press, and why does that name sound so weird?” What on earth is warm wisdom? Is that what happens to “hot tips” once they’ve time to mature and cool off a little bit? Turns out it’s a dating/marriage site, providing books and CDs with vaguely ominous titles like Get the Ring and Keep the Ring. Anyway, we’d like to stop the review there - hopefully we’re all smart enough not to take trading advice from dating/gardening/sewing/home improvement gurus. But, to be honest, even if David A. “Warm Wisdom” LeVine (he’s the proprietor of all these sites) weren’t giving us ample weird reasons to avoid his trading service, this service itself is suspect enough.

Honest marketing - Fail

Iron Condor Report doesn’t do any search marketing that we could find, so they get points for leaving people alone. But the sales letter copy on the site itself is just absurd. It’s really better to quote at length:

We’ve found a wizard who selects the trades and the timing based on a sophisticated algorithm that is a proven winner. (Sound complicated? Don’t worry. We can’t figure it out either. That’s why we need the wizard. Want to try it for yourself?…)

We figured out that with our own intelligence officer on staff, we could cut costs enough to afford to offer this system at the giveaway introductory price of $600 per year! (There are limitations–aren’t there always?! See “Legal Stuff” at the end of this letter.)

No, we won’t blow our operative’s cover. Then he wouldn’t be our secret agent anymore. (And then we might have to raise our prices!)

Wizards? Secret agents and operatives? What? But the best part, really, is “Sound complicated? We can’t figure it out either. So, give us your money, okay?” Sigh. It doesn’t take genius mathematicians or secret agent traders to [tag]trade[/tag] iron condors, and it’s pretty dishonest to treat customers like scared children. Education and open communication always wins out over “secret agents” and paternalistic pandering.

Repeatable returns - Fail

The website itself consists of three pages: the main sales letter, the payment page, and a dysfunctional contact page. In other words, there’s not even enough information to even begin to guess at the repeatability of claimed returns. There’s no performance information of any kind, no details about their strategy, nothing. What’s more, they seem to be trading the big open-outry products like SPX, RUT, and MID, which is a recipe for slow fills, lots of slippage, and bad [tag]risk management[/tag]. Maybe their secret agent forgot to take the needs of smaller investors into account?

Risk management - Pass?

They claim that “you need 25k to start.” That’s false: any decent broker will only require margin for one side of an iron condor trade, since you can only lose on one side and not both. And a 3- or 4-contract position on a liquid ETF should require a few hundred dollars of margin, not several thousand. But we also learn that they send 2-3 trades per month, which is a lot better than the one monster trade that most iron condor advisories demand their members put on every month. As we mentioned recently, it’s better to add inventory rather than constantly adjust iron condors, and maybe, just maybe, these people are accidentally stumbling onto that idea? Of course, without actual performance data, we have no way to tell, and we’re only giving them a questionable Pass because the weather is so nice in Manhattan today, and we’re going to the park as soon as this review is finished, so we’re in a good mood.

Reasonable Price - Fail

$600/yr is dirt cheap, and their cut-rate pricing is really the core of their sales approach. But they don’t offer a monthly or quarterly subscription, so you have no chance to try it out. Plus, they charge shipping! wtf?! In any event, good trading advice doesn’t seem like the sort of thing you want to get from the bargain bin at Wal-Mart. We absolutely hate the bastards that charge $5000 for “online courses” that teach things you could just as easily learn online for free, but we also don’t think that bargain basements are the right place to get [tag]options[/tag] trading education. And even at $600, this site offers too little information and is too cheesy and ultimately laughable to deserve anyone’s money.