Hedgeye is a stock resource that sells various services and products.
Some of their more popular products are:
- Hedgeye Risk Manager
- The Macro Show
- The Call @ Hedgeye Plus
- Bitcoin Trend Tracker
Before throwing money into these programs I'm sure you want to know if they're scams or not.
If so - I got your back.
I reviewed all aspects of this company and below you'll find everything you need to know about Hedgeye.
You'll know if it's worth it by the time you're done.
Let's get into it!
Owner: Keith McCullough & Michael Blum
Price: Depends on product
Do I Recommend? No.
Summary: I'd avoid Hedgeye. The customer reviews for this company are absolutely horrible and the trading signals likely won't help you profit much.
In the terms of service Hedgeye claims you can't expect the returns they advertise for a million different reasons and no one at Hedgeye actually trades.
Overall, this is more just trading entertainment.
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Keith McCullouh Lying About His Past?
Keith McCullough is one of the cofounders of Hedgeye.
One of the things I find interesting about him is I couldn't really verify anything he has on his resume.
Keith claims he worked at Falconhenge Partners as a portfolio manager in 2005 and worked at Carlyle as a portfolio manger in 2007:
I've never heard of Falconhenge but Carlyle is massive financial corporation that manages hundreds of billions in assets.
However, if you do a check on FINRA for McCullough, there's no proof he ever worked there.
And according to FINRA, you need to register with them if you're associated in any way with a firm's securities or investment banking.. which is something a portfolio manager would be associated with:
According to the SEC, there's no proof of him working at Carlyle and it shows the only exam he's ever passed is the series 65 to be a financial advisor.
However, he passed this exam in 2010, years after he claimed he worked for Carlyle.
Being a portfolio manager at Carlyle requires a series 7, requires you to register with the SEC, to register with FINRA and more:
Unless Keith has an explanation on how he became a portfolio manager for one of the world's largest asset management firms without any of the proper licensing or registrations, I personally believe he's lying.
He's not the first person I've come across that's lied about his past.
There's actually a lot of people that sell investment products that are completely fibbing about their experience.
There is proof Keith graduated from Yale like he claims, though.
He seems to have been on the hockey team from 1995 to 1999:
What Keith was doing from the years 1999 to 2010 (when Hedgeye registered with SEC) I have no clue.
I emailed Hedgeye and asked for an explanation - will update if I hear back from them.
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No One At Hedgeye Actually Trades
While doing some research into Hedgeye I came across a very interesting article from 2014.
A man named Carmine Pirone wrote a blog article claiming Hedgeye was acting fraudulently.
Carimine's claim was McCullough pretends to make trades on Twitter to convince people he's a successful trader.
This makes people want to buy McCullough's services.
However, according to McCullough he doesn't actually represent himself as a trader.
In the terms of service it's written clearly that not only does McCullough not trade, no one at Hedge trades.
Now is a good time to ask this very basic question:
If Hedgeye's trade alerts and investment research is so good, why don't they trade?
The answer should be pretty obvious.
Sure there's more paperwork and registrations involved with portfolio management and making trades on behalf of clients - but its so much more profitable.
If the trades were so good at Hedgeye, wouldn't it make sense for them to make the trades and make all the money?
Clearly selling the trades makes more than the actual trades themself.
The Advertised Returns Are Hypothetical
Because Hedgeye doesn't actually trade you can't really take any returns they claims as factual.
They actually admit this in their terms of service.
They list a bunch of reasons why the returns you get will differ from the high returns they claim these trades get:
There's a lot there but some of the reasons their alert results will be different than your actual results are:
- Transaction costs (swing trades can cost up to $100 per trade)
- Time delays
- Margin interest costs
- Position sizes
- Actual errors in the alerts
According to Carmine Pirone, in 2013 the weighted average return of all trades was only 0.3382%:
Things get even worst, though.
In 2014, McCullough claimed 90% of his clientele was institutional traders.. so people that manage hedge funds and portfolios
One hedge fund called Griffin Asset Management set up a portfolio based on the alerts from Hedgeye.
After a year the portfolio was shut down because the results were so bad.
According to them it failed because they weren't big enough, despite managing hundreds of millions in assets:
I mean if $400 million isn't enough to make the trades work, I doubt whatever you're trading with will be enough.
It does seem since 2014, Hedgeye is focusing more on individual investors instead of institutional investors as well.
On their "about" page it claims this is a service for "everyday investors:"
I'm not sure if their alert service has changed since 2014.
Just keep in mind $400 million apparently wasn't enough to profit before.
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Mega Market Trends
The reason I'm reviewing Hedgeye today is because I saw this ad running on Youtube.
This is another sign they're targeting individual investors now instead of institutional investors.
There's probably a good chance that you saw this ad too and are now researching how legit this company is.
Basically this gives you 30 day access to their products.
This includes the following:
- Mega Market Trends - You get a replay of the February webcast from Mega Market Trends. It's a really technical presentation.
- Hedgeye Risk Manager - I'll cover Risk Manager later but it's the flagship product at Hedgeye and is most products combined into one subscription.
- Analyst Stock & ETF Ideas - This is stock analysis from the team at Hedgeye.
- Trading signals - These are buy and sell alerts for swing traders.
I do like that you're getting 30 days access to everything.
My advice is to set up a demo account and test out the trades to see if they work for you.
If you get good results (from what I've seen this likely won't be the case) then consider paying for the service.
Hedgeye Product Overview
There's a lot of different products for sale at Hedgeye.
However, you can get basically all of them for one membership under their Hedgeye Risk Manager package.
Here's a breakdown of that services.
Hedgeye Risk Manager ($2499 Per Year)
This is the main offer at Hedgeye and includes most of the core products available.
You get the following:
- Daily Newsletter: The daily newsletter is called Early Look and costs $269 per year if you buy it separately. This newsletter offers you insights into the market, an analysis of "key macro and market catalysts" and risk ranges.
- The Macro Show: The Macro Show is a daily livestream that costs $449 per year separately. You'll get a look at the news from the market, hear from special guests and get the opportunity to ask Keith questions directly.
- Market Edges: Market Edges is a macro newsletter that comes out once a week. It costs $134 per year if you buy separately. It breaks down charts, investigates sectors and breaks down the market.
- Investing Ideas: Investing Ideas is a weekly newsletter that costs $269 per year when bought separately. This newsletter gives you stock ideas with risk ranges, as well as updates to buy alerts.
- ETF Pro Plus: ETF Pro Plus is a monthly macro newsletter that costs $359 per year when bought separately. Like the name suggests it focuses on ETF's.
- Quarterly Investment Outlook: The quarterly investment outlook focuses on the macro movements of the market in the next months.
- The Call @ Hedgeye Plus: This service costs $449 per year and is just the highlights from the daily livestream Hedgeye does.
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Here's some answers to any remaining questions you might have:
1) Is the price fair?
It's definitely pricey in my opinion.
To be fair to Hedgeye you do get a pretty decent amount with your subscription.
You get a bunch of newsletters and access to daily videos.
But you need to keep in mind that every dollar spent on getting stock ideas is a dollar you start in the red.
If you only make $2000 after all your trading transactions for a year you're still technically down.
2) How much do I need to get started?
According To Griffin Asset Management they didn't feel $400 million was enough for these trade alerts to work.
So I guess a billion should do it..
In all seriousness you need a pretty good amount, which is probably why McCullough focused mainly on institutional traders in the past.
However, it seems things have changed and retail investors are the main focus now.
You get a bunch of trade alerts a week and by law you need $25,000 in your trading account to make more than 3 trades a week.
So I'd start with that number.
Realistically, you will need 6 figures to trade with to have ANY chance of profiting anything significant.
3) What kind of trading will I be do doing?
This is mainly for swing traders.
Swing traders buy and sell stocks in a short amount of time and if you look at their past alerts it seems you don't hold more than a couple days.
This kind of trading has proven to be the worst strategy.
It's almost impossible to guess where a stock price will be in a day or two.
Day trading has a notoriously low success rate and less than 1% make more than minimum wage.
It's not worth getting involved with.
4) Is there a refund policy?
I couldn't find any mention of a refund policy.
This means there probably isn't one.
Usually I would say this is bad but since you get to try the service for 30 days free I don't think it's too big of a deal.
5) Hedgeye Customer Complaints
Hedgeye doesn't get good customer reviews.
In fact, it's one of the worst reviewed companies I have ever seen from a customer standpoint.
The average score for Hedgeye on Trustpilot is a dismal 2.4/5:
The crazy thing is you can manage your reputation on Trustpilot.
I've seen many scammers game their score on Trustpilot to get a 4.8/5.
There's just so many bad reviews I can't even really cover them all.
Basically everyone is saying to avoid Hedgeye and that you will lose money.
If you want to read all the reviews, click here.
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Hedgeye Pros And Cons
Hedgeye reminds me of a poor man's Chaikin Analytics and is similar in quality to Market Rebellion.
At the end of the day there's a lot of red flags here.
I personally believe McCullough is misleading about his past experience as a portfolio manager.
Additionally, there's a lot of proof the trade alerts just aren't really profitable.
McCullough and Hedgeye is more just entertainment than a serious service.
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I'd pass on Hedgeye.
I'm not really a fan of the company and I definitely don't recommend swing trading.
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