Jake Bernstein is currently the Founder and President of MBH Commodity Advisors Inc. and Bernstein Investments Inc. He heralds himself as an “expert market analyst” and a “futures trading guru”. He claims that he is particularly proficient in “economic cycles”. He says that making a fortune through stock markets is almost child’s play, if you just follow his instructions...He emphatically asserts that futures and commodity training is not risky at all...
Jake Bernstein hosts several seminars, all targeting aspiring traders. Each of these specialized seminars claims to tackle different aspects of trading, and each one comes with a different price tag. Jake Bernstein assures you that within no time of attending his super seminars...you’ll be raking it in rich.
But what’s the true picture? Reality is that, none of his much-touted methodologies and trading techniques are effective. In fact a group of trading experts tracked Jake Bernstein’s recommended trades, and actually found that they all lost a lot of money, for five years! He’s quite obviously another dime-a-dozen self-proclaimed “guru”, who makes money by scamming people, and not by market trading techniques.
On May 11, 2007, the NFA came to consensus and expelled Jake Bernstein. They slapped a fine of $200,000 on his companies, and charged him for “using misleading promotional material”, “making false profit claims”, and “downplaying the risk involved in trading”. Yes, Jake Bernstein is a certified scam-guru.
William Green, of Forbes Magazine, recently wrote an article:
I'm TEACHING YOU SOMETHING that I know works," says Jake Bernstein. "It's real simple." Bernstein, 51, is in a Washington, D.C. hotel meeting room mesmerizing an audience of aspiring futures traders.
Want to make a killing, trading futures? All you need to know, says Bernstein, is that many seasonal price patterns occur year after year. Buy live hog futures on Oct. 30 and sell on Nov. 27. That's a trade that would have made you money almost every year in recent decades, he claims. Bet on the S&P 500 March contract to rise from Jan. 12 through Jan. 18. For 15 years, he says, this trade was a winner 93% of the time.
Does anyone believe his nonsense? Unfortunately, yes. Intoxicated by the promise of easy money, audience members line up to buy Bernstein's products, among them his books, with titles like The Seasonal Trader's Bible and The Best of Bernstein: A Treasure Chest of Jake Bernstein's Market Wisdom. His monthly newsletter costs $400 annually; his weekly newsletter costs $895 a year. He sells three other newsletters, plus video courses and a CD-ROM ($695) that lists 60,000 seasonal trades. He offers telephone hot lines and charges up to $2,500 per person for his two-day seminars.
Yes, you can fool some of the people all of the time. Commodity Traders Consumer Report, a respected futures publication, tracks the trades Bernstein recommends in his $895 flagship newsletter. If you had acted on these weekly tips from 1988 through 1992, you would have lost money for five consecutive years (assuming typical transaction costs).
Let's say you set up a $20,000 trading account in 1992 and executed the newsletter's recommended trades for that year. Your account would have been wiped out. In 1996 you would have lost 95% of a $20,000 account. Bernstein's response: "There are always losing periods."
Jake Bernstein professes to be an expert on the psychology of trading. His qualifications? In registering with the Commodity Futures Trading Commission, the Montreal-raised Bernstein wrote that he held a master's degree in psychology from Chicago's Roosevelt University. In fact, he never completed his master's studies.
In the 1980's Bernstein hooked up with an outfit called Robbins Trading and helped to manage futures accounts for investors. James Roemer, who co-managed money with Bernstein, says: "Jake is brilliant, but he can't manage money to save his life.
He'd get scared, buy at highs and sell at lows. . . . Bernstein kept losing money." Jake Bernstein found an easier way to get rich. Instead of just trading futures he would trade on investor gullibility.
In 1996 he starred in an infomercial that has aired on nearly 400 TV stations. It hypes a video course ($180) called Trade Your Way to Riches. In it a farmer named Harold Henkel tells viewers how well Bernstein's approach has worked for him. Henkel, however, now admits that he lost money trading in 1996 and 1997 while using Bernstein's products.
On his Web site Jake Bernstein offers to set up customers with his personal brokers at Fox Investments, a division of the Chicago brokerage firm Rosenthal Collins Group.
Suppose you take Bernstein's recommendation and set up an account at Fox with $5,000, the minimum that Bernstein says you need to become a trader. Your commissions would be $60 to $80 per trade, about three times more than savvy retail customers pay. Bernstein's weekly newsletter offered 195 recommended trades last year. At that rate, a small trader's commissions alone might amount to more than double his or her original investment. Needless to say, Jake Bernstein receives a slice of the brokerage's commissions. A Fox broker appeared in Bernstein's infomercial, touting his seasonal trading approach.
Says Bernstein: "There's no arguing with history." Say we: Where are the regulators when you need them?
Everyone, who’s anyone in the trading market know this – trading involves risk. And the higher the prize, the greater the risk. Don’t let anyone lead you into believing otherwise. The NFA has said it. Forbes has published it. And we are emphasising it – Jake Bernstein is a fraud, keep away!
