The Computer Programmer
It was just 6
months ago that Edward ran his first simulation with his newly completed
Chaotic Stock Market Simulator. The results were impressive - with the
system making money in 19 out of 20 trades.
He remembered
blowing a cool $500 that night taking his parents and 6 sisters out for
dinner. All he told them was that he stumbled on something big and that
there will be lots more dinners like that soon. Since they were getting
a free meal they decided to simply eat first and ask questions later.
In the following
days, as he ran further simulations with more data and more markets,
Edward began to realize that he had jumped the gun. The system was
actually winning trades in only about 75% of the time. And once you
include real life trading factors like the bid-ask spread, slippage and
the trading commission, the numbers looked worse.
Finally, after
another 6 months of testing and program refinements, version 2 of his
program is ready. It has managed to take everything the Edward can throw
at it and still show a relatively healthy profit of 5% per month. There
are some markets that the system cannot trade reliably, like thinly
traded or very volatile markets, but it can filter those markets out
before trading.
Tonight, Edward
will take his family out for the second time. They are going to
try out the new Japanese restaurant across the street from where he is
currently working.
Tomorrow, Edward
will start "selling" his software. First, he will have to get somebody
to design and program his site. He already knows what he wants for the
site. It will be a subscription-based site with the subscription set at
$100 per month. He intends to offer a trial subscription of $10 for the
first month so that they can be assured of the accuracy of his
prediction.
The site must be
able to receive credit card payment and must be able to bill the
customer when his subscription is up. He must also be able to upload his
daily analysis onto the site without too many hassles. There will also
be an affiliate program that pays $25 per month for each referral.
As for promotion,
Edward knows exactly what he is going to do. He will go to the local
stockbroking office - he's got some friends there - and offer every one
of the brokers a free membership to his site. Once they find out the
value of his site, they are definitely going to recommend his site to
their
clients.
The brokers will
earn commission as their clients trade, in addition the $25 affiliate
commission, while he will make money from the subscription fees and the
broker's clients will make money from his trade recommendation.
Summary of Edward's Plan
Product
Advice on trading
the stock market.
Marketing
Edward will use
his offline connections at the local stockbroking office to market his
site to the brokers and their clients.
Expenses
Edward will have
to pay a web designer or a web design company to design and program his
site. A site like his could cost anywhere from a few hundred to a few
thousand dollars. $50 or less per month will be spent on web
hosting and domain name registration.
Income Stream
Each member of his site will pay him $100 per month.
