—ParadigmTrades.com was created as an information exchange for a unique group of traders working within a unique sector of the stock market. This strategy focuses on a completely different world than the blue chip buy-and-hold methods of Wall Street. This is a strategy dominated by short-selling and intraday buys that can be applied to small cap stocks that trade on the NASDAQ exchange.

—My trading focuses mostly on bio-techs, baby-pharmas, and blatant scams that are commonly found in this unique niche. Where is the opportunity? The opportunity is in the overall design of these companies themselves, and their desire and ability to use gullible “investors” to fundraise their further developments.

—The ability to capitalize and make money within this sector lies in the ability to spot what is called a “pump”. There are many forms, but the most common pumps are done by small, fundamentally unsound, and fledgling companies that are usually pre-revenue or pre-income. These companies are desperate for funds and will pay promoters, banks, and analysts to convince unsuspecting investors to buy their stock via upgrades, positive press, promotional campaigns, boiler rooms, and more. This in turn causes the stock’s price to rise well beyond the value of the underlying company, and this is the point that the company will execute what are called secondary offerings. A secondary offering is when shares of the underlying company are either dumped onto the open market at the bid (At-The-Money offering), or are offered at a discount to select investors. These offerings make a fortune for the fledgling company, their officers, and the investment banks, but cause dilution, crush the stock price, and almost always leave the retail investor “holding the bag”.

—The ability to spot this manipulation and capitalize on it via short selling (betting that the stock price will decrease) is the main concept, and it is a complete paradigm shift from normal investing mentalities used in buy and hold value investing. Although buy and hold is a valuable approach for those with considerable sums of money and time to wait, my approach is ideal for those with smaller sums of money and shorter time frames.

—I am self-taught and self-funded, and learned by watching other successful traders working in this sector, as well as by compiling my own studies, data, and experiences. Is this approach safe? Absolutely not. Have I suffered multiple losses while climbing this never-ending learning curve? Absolutely. Will you too? Absolutely. However, if you can take the pain while learning the system, this strategy can make BIG money with a SMALL account. That being said, consistency will only come with humility, emotional control, and the avoidance of becoming a “home-run trader”.

—The content on this site is free. It features live videos and analysis of the mentality, data, fundamentals, technicals, and sociology behind the trades. I also hope to learn from you, so please feel free to comment, collaborate, and share.