Anthony was one of these people who kept poking at our programs, always looking to get the freebies. His strategy was to try to piece it together, little by little. The problem was, that strategy doesn’t really work.

Having a little information is worse than having none. You really need to know and apply everything in the package. It’s all important.

When I identified what he was trying to do, I started to get concerned. I knew where this was going – he was setting himself up for some major losses. Total failure.

We’d go back and forth with emails, a little advice here, a tip there. But he refused to commit to any serious training. Then one day, I received a very disturbing email: essentially Anthony took a major hit for something like $18,000. I could sense the distress on the other end; clearly this was a major blow to his account. Through ensuing emails, I determined that he had put his money on WMT. “Why are you trading WMT?”, I asked. “I know it’s Walmart but we never trade that.”

Turned out it was a hot tip from a well meaning friend to suggest WMT. The stock was set to rise and he will make a fortune on the options, or so he thought.

“Well Anthony, I wish I can help you, but I never talk about Walmart… or McDonald’s, or Lowe’s or Haliburton or anything else other than SPY. I’m very sorry but you’ll have to check back with your friends about that one.”

Well-meaning friends, relatives and associates want what’s best for us but even if they were right, by the time they receive the information, tell you about it and you act upon it, the market has already built it into the price. Moves are quick. If you or someone you know ‘knows’ something about a particular stock, the rest of the world has already acted on the news. Unless you are the newsmaker, consider it ancient history.

I explained this to Anthony to disregard everything he hears from friends. Nod your head when they talk but do not necessarily trade their suggestions unless you conduct your own due diligence. There is a reason I don’t trade WMT, or anything other than SPY. Unfortunately, he lost his nest egg on this one.

Celebrate your friendships but keep your trading business separate. On another note, you will find yourself in an awkward situation if you execute trades based on their advice, only to have it turn against you.