We all have heard and read about new investors getting lucky at picking the right stock. Many of them claim to have followed the advice of an experienced trader who has picked the right stocks for them. How do they get the news? The answer is simply by subscribing to a stock newsletter that can proof that their recommended stock picks do actually rise in price.

Here's how you can identify if a stock newsletter is worth its cost.
First of all, search for "stock newsletter" at a search engine of your choice and check the first results page. Look at each website carefully and see if they offer some sort of proof. Are there any testimonials? Do they offer examples from the past? Maybe they offer a video? If the evidence is in favor for the stock pick newsletter that gets offered, subscribe to it and do not make any trades yet based on their recommendations.

Next step: Patience is key.
As soon as you have received your first stock pick, double-check the selling price at Yahoo Finance. Take a note and check back later to see the development of the stock. You are basically just scouting if the stock picks are any good. Keep doing this for at least the first 5 trades.

I know it might be tempting to just do an actual trade especially after the first one you have tracked was an actual success. But try not to do anything yet other than observing. If there have been 3 to 4 successful picks out of the 5 trades you have observed, you can go ahead and do a trade based on their recommendations (You might want to even observe the first 10 or 20 trades to get better statistics).

Plan your budget wisely.
Don't invest all you have in the first trade. Should you lose, you know that you can make it back since you know that 4 out of 5 trades will be successful. The accuracy of this success rate increases the more data you gather (i.e. the more trades you are observing).

Many stock newsletters require a one-time payment of $50 to $100 (sometimes more) when signing up. Don't stay away from these. Most of them offer a 60-day money back guarantee. Observe the recommended trades as mentioned above. Should you see that the stock picks are not worthwhile, get your money back. It's actually very easy and in most cases you get your money back right away without having to answer any questions. Most people simply forget about it. That being said, if you are satisfied with the quality of the stock newsletter the subscription fee is while worth the investment.