Newsletters Are Big Business

Another interesting insight from Barron's was that Richard Russell has 7,000 subscribers to his Dow Theory Letters service. At $250 per subscriber, he is making $1,750,000 a year in subscription revenue. That's pretty darn good.

It just goes to show you how much can be made in this industry if you've been around long enough and have developed a strong subscriber base. It also justifies the fact that almost every day I receive hate email from another newsletter writer who thinks I'm hurting the industry by providing a free service (or at least one that accepts voluntary donations). Yet, at the same time if you ask someone like Russell to live on his actual trading recommendations alone, he would probably starve himself to death!

To be sure, there is lots of competition in this industry and the profits are enormous especially if you can get yourself on TV. In fact, just consider the new service offer by Tobin Smith at Changewave. He only charges $2,995 per year for a stock picking service in microcap stocks. What a racket. Here is a link to his special offer.

A lot of people ask me how I survive by offering a free newsletter or one that only accepts donations versus a subscription based service. The answer is that I don't. If this was my only income, I'd be better off working at Wal-mart as a cashier clerk. So far donations to this website are quite low which is a good indication that what I offer is of little value or at least something that few investors are willing to pay for.

Don't get me wrong - I have very loyal readers. I enjoy doing what I do and this website provides me with the ability to convey my thoughts. But, when I read that guys like Russell make almost $2 million a year and likely spend far less time than I do every week offering insights and analysis to the market, it serves as a wake-up call that I should use my time in different ways. Any thoughts about this? LET ME KNOW