Poor Lenny Dykstra, his life seems to be coming apart.
Just a few days after a massive ESPN article that reported he’s borrowing money from his mother, he’s faced 18 legal actions since November, and a ton of other bad news, we learn he’s been cut from TheStreet.com (see the tiny text on the graphic on the right).
Nails probably should’ve seen it coming, as TheStreet.com’s editor-in-chief Dave Morrow refused to support him for the ESPN story:
Four telephone messages left for Morrow went unanswered.
Dykstra’s own analysis of his success in the market goes Cramer one better than “very good.”
“You know about my stock picking, dude?” he asks. “I’m 92-0 [last year], worst market in history. Three thousand people signed up and pay $1,000 … I’m making people fortunes. I’m moving $3-5 billion a month.”
Some who track the market are sceptical he could be that successful. Options trader and author Adam Warner, for example, suggests that Dykstra isn’t accurately accounting for losses. Warner says a Dykstra-recommended position lost more than $200,000 in January.
“It is all nonsense,” says Warner, options editor for the financial Web site Minyanville.com. “He’ll buy a 10 lot of, say, IBM. And if it makes a dollar, he’ll sell it. If it loses, he’ll buy more and he’ll keep buying more and more. So he’ll never actually realise a loss. And he buys options that expire in as few as six months and sometimes as long as a year. He’ll book his wins and he’ll just let the losses run. So what happens is, he wins all his picks, but the losers may eat up 100 wins. The bottom line is how much money you make. It’s not how many picks you make or what your winning percentage is.”
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