TEACHING THE MASSES TO SEIZE THE DAY
Headfakes. Wiggles and jiggles. Market makers, short sales, technical analysis. In four weeks, Harvey Houtkin's All-Tech Investment Group in Montvale, N.J., explains not only what those terms mean but also how to profit from them. The price tag: $5,000.
All-Tech wants to bring day trading to the masses. It says 400 to 500 people have gone through its school since it opened in spring, 1995. ''We allow the average person access to the market,'' says Houtkin, All-Tech's president. The classes were free at first, but they attracted too many sightseers, he says. Houtkin claims that 4 out of 10 people who take the course will be successful day traders.
NIMBLE. Trading school begins with a week of classroom instruction. Students learn what kind of people succeed in day trading (disciplined people who control their emotions, cut losses quickly, and never hold a position in a stock overnight), how to spot market trends, how the systems work, and what rules and regulations govern the market.
In week two, ''paper-trading'' starts--making trades that get executed in theory. Some people paper-trade for two months before they choose to move into a ''halfway room'' where they make real trades, albeit under supervision. Students who trade at All-Tech get a $2.50 discount on commissions for six months or until the discounts add up to $5,000.
Not every student is allowed to work in the office, however. ''You have to trade enough for it to make economic sense to keep you,'' says Houtkin. ''Enough'' is 20 tickets a day or $450 in commissions ($25 a trade, less the $2.50 discount). Commissions range from $20 to $31.25, depending how often people trade. The 80 to 100 people who don't trade in All-Tech's office work through a remote trading system.
Houtkin doesn't promise success. ''We give you the tools. If you have the talent, you can do very well,'' he says. No matter what, ''they know more about the reality of the market after being here than if they had gone to Harvard.''
By Suzanne Woolley in Montvale, N.J.
Updated June 14, 1997 by bwwebmaster
Copyright 1996, Bloomberg L.P.