What should I charge for access to technical financial analysis?

I'm building a site that allows users to access very technical and quantitative information about stocks.

Since, we're in the business of helping our users make money, we're thinking they'll be more willing to pay for this data.

What do you think would be reasonable price to charge per month?

If you need more information about the site, you can see the progress here:

http://www.traderbots.com

 

Well, at first, I highly doubt people are going to be willing to pay money to get advice from a website with 0 track record. It may be more reasonable to generate revenue through other means, such as advertisements that refer people to services such as e-trade (assuming you get a CPA).

 

I couldn't agree with discussnow anymore, people will not pay for this service unless you provide some other information that sites like yahoo finance or msn finance provide to its users. THe reason you will get hits and people being informed from your site is because its free, you can surely generate revenue from ads, i would recomend with adverts instead of having paid service.

 

Its a wise move.
The fair price is charge per month around $100
Do offer discount for client that pay for 1 year in advance.

 

From what I saw of the site the information currently provided is worth $0.

What do you intend to provide in the future that will be of some value?

Tom

 

Please explain how this site could possibly be worth anything even close to that amount. Did you even look at the site?

You really like to hear yourself talk.

Tom

Edit: Never mind, I forgot that you believe forex is a wise investment. You therefore cannot be expected to have any real knowledge of what you speak.

 

Yeah, the track record problem has come up. We need to figure that out, because we can't initially depend on word of mouth yet.

Maybe, we'll need to give people free memberships to start the viral word of mouth that our systems work.

We won't be winning any competitions, because we're not trying to make you a billion % points in a day. We look for steady returns with low risk. And we want our customers to do better than how they do today.

Ads won't work for the long-run. We're pretty niche, so our user base will never hit a level where we can be profitable through ads. Our technology is too costly to run on just ads.

 

At the end of the day, we'll play with both. Ads to hold us over until people start realizing that what we do is valuable.

Do you recommend any services we can provide that might be worth paying for now? We do offer more analysis than MSN or Yahoo would ever provide.

 

That might be what we'll start with. Play around with the price some. If the price is too low, then you start experiencing slippage (although we mainly focus on high volume stocks, so we might be ok).

I was mainly just curious if people thought $100/month would be too much.

 

Tom - I'm curious if you're my target audience. Do you trade stocks?

If you don't ever feel comfortable trading stocks, our information is useless to you I agree.

If you "Buy and Hold" well, have you enjoyed your performance over the last decade? My colleagues and I exited close to when the market started turning south, because we're active traders.

 

Hey Tom -

What's your background/basis on this?

I'm not going to enter a religious argument with you, but I'm just curious where you're coming from.

 

Just to give you an idea, far from complete:

30+ years ago, I became an investor - I would not call myself a trader, but I am not a buy and holder either. I had less than 5% of investments in stocks at the beginning of 2008.

20+ years ago I passed the CPA exam

I have worked for 2 of the Big 4 accounting firms. My responsibilities included being responsible for the audit of the foreign exchange hedging contracts of one of the 10 largest multi-national companies in the world.

I no longer work for others, currently I am best described as an asset manager.

I am here at DP mostly as a lurker, interested in online investments. While reading here I have gotten really tired of people who have no experience or knowledge making investment recommendations. From my quick review of your site you appear to be one of them.

What are YOUR qualifications to be making investment recommendations? Are you currently, or have you ever been, in any way, certified as qualified to give investment recommendations?

Tom

 

Tom -

Looks like you're trying to provoke an argument, I will not participate. I've seen forum arguments digress to immaturity, and I'm not looking to waste my time and have that become permanently out there on the web. If you're truly in your 40s to 50s, you have enough experience in life to understand no good comes out of that.

Also, certifications help establish a minimal bar, but usually low nonetheless. I've seen countless developers come saying they're Microsoft Certified. Usually those are the worse! Real Estate people seem to be certified in Community College. People coming out of college with CS degrees who can barely program. Even with doctors, there is a huge variance.

My experience is an individual investor that has done well in himself. I think my techniques can help others. I got out of most of my stock investments in Dec 2008. Except for a small set of mutual funds in my 401k.

I see this as an interesting customer study though. One of our targetted markets is the experienced market technician. Would you think of say you fit that bill?

I like how you consider yourself an investor, but not a trader. That's similar to myself, but if you don't think our service is worthwhile without at least paper trading it, then . . . I would love to hear more about why, so we can improve.

If it is general pessimism about such systems, unquestioned belief in the "efficient market hypothesis", or disbelief in mechanical trading, I'm not too worried.

If it is our site is the cause, then I'd like to hear more about how we can improve.

Constructive, not destructive. Not looking for a pissing contest, what does a man in his 40s or 50s still need to prove?

 

Hey Tom -

Just IMed a colleage about you. He wants to know how you decide when to enter/exit an investment. What strategies do you use?

Also, would you consider yourself the type of person to ever buy Trade Station or similar product?

 

Correction. December 2007. It was very nice to not participate on the wild ride down.

 

This has probably already been covered, but here are my concerns:

1. Who developed the algorithm and what was their experience level and education? I saw nothing on the site that would make me trust your numbers at all.

2. You have (as mentioned) no track record.

How do you fix this?

1. Create a bio for the people who developed the program. If you don't have any fancy ex-fund managers, then focus on education and licenses. I see nothing but a couple of college kids when I look at the site (may or may not be true, but that is the feeling I get). That would make me turn away from the site. Not that college kids can't come up with something great, but I don't want to be their guinea pig.

2. Give the membership for free to a couple of big finance bloggers or writers. Let them try the system and write a testimonial for you--they may also recommend it to their readers.

3. Show us what you bot has recommended about other positions and how much money we could have made had we been subscribers (use screen prints to illustrate this).

4. Invest in a copywriter to compel users to subscribe. They can talk about human fallacy--remember when Cramer said we should all buy Bear before it took a big dump? Talk about how your bot is more reliable than a person--completely objective, nuts and bolts data crunching.

5. I would imagine you are using your own bot. Scan your brokerage and retirement statements to make people believers.

Once you've done this, I would compare the price of subscriptions to Reuters, NeuroMaster, and other analyzer systems. Not only will you be able to set a competitive price, but you can also talk about the added value of your system compared to these.

 

You need to gain a reputation first. I suggest starting some kind of Blog and advertising yourself a bit.

 

Prinzel - You rock. Your insights are right on!

We'll look into your suggestions. Thanks a bunch for your ideas!

 

Hey Prinzel -

I was just thinking about your feedback. Here's some thoughts.

"1. Who developed the algorithm and what was their experience level and education? I saw nothing on the site that would make me trust your numbers at all."

We should do this. One thing to note is that I see tons of sites out there that claim to have winning stock pickers, but I believe half of them are shams. They also post wonderful blurbs about their experience.

"2. You have (as mentioned) no track record."

We started thinking we should enter our bots into trading competitions for 3rd party verifications. Of course this takes time, but you're right.

Right now our system is strongly bearish. Let's see if we're right, because everyone seems to be quite bullish.
http://www.traderbots.com/stocks/Stocks.aspx

"1. Create a bio for the people who developed the program. If you don't have any fancy ex-fund managers, then focus on education and licenses. I see nothing but a couple of college kids when I look at the site (may or may not be true, but that is the feeling I get). That would make me turn away from the site. Not that college kids can't come up with something great, but I don't want to be their guinea pig. "

We hope that in addition to this, our users will also paper trade our predictions to independently verify our results.

"2. Give the membership for free to a couple of big finance bloggers or writers. Let them try the system and write a testimonial for you--they may also recommend it to their readers."

Good idea. We actually plan to give everyone free memberships for a couple of months. We're in it for the long haul, so a few months is nothing if we're aiming to build a subscriber base that subscribes for the rest of their life. Ultimate proof in our abilities.

"3. Show us what you bot has recommended about other positions and how much money we could have made had we been subscribers (use screen prints to illustrate this)."

We do this already. You can see a graph of past performance:
http://www.traderbots.com/stocks/Portfolio.aspx?aId=117
or even take a look at the individual trades:
http://www.traderbots.com/stocks/PortfolioHistory.aspx?aId=117

"4. Invest in a copywriter to compel users to subscribe. They can talk about human fallacy--remember when Cramer said we should all buy Bear before it took a big dump? Talk about how your bot is more reliable than a person--completely objective, nuts and bolts data crunching."

This is a d*mn good idea. We realized that initially what we do is hard to grok. We actually started fleshing out our about pages here:
http://www.traderbots.com/stocks/About/About.aspx

The topics you talk about are good.

"5. I would imagine you are using your own bot. Scan your brokerage and retirement statements to make people believers."

That's a good idea. I think you're essentially saying some kind of 3rd party verification. We have some ideas in mind.

 

I agree--but it's really important that you remember that you aren't writing the "About Us" copy for you and me. You are writing it for your prospective clients, the larger percentage of which are not that savvy.

Hopefully, you don't take that as condoning lying and misleading--you can write copy that appeals to an unsophisticated audience without lying to them or cheating them. I get the feeling that you are sincere and truly believe in your bot....hopefully I'm not wrong