8 Best Stock Trading Signals Providers for 2024

Why Trust Techopedia
Why Trust Techopedia

Looking to trade stocks but don’t have the skill set to consistently outperform the market? If so, stock trading signals are worth considering.

In a nutshell, signals are stock trading suggestions that tell you what companies to invest in – based on expert insights or artificial intelligence.

In this guide, we rank and review the 8 best stock trading signals providers for 2024. Read on to discover the best-performing stock signals with the most competitive prices.

The Top Stock Trading Signals Providers Ranked

The 8 providers listed below offer the best stock trading signals in 2024:

  1. AltIndex: AltIndex is an alternative data provider that leverages machine learning and artificial intelligence. Its stock signals service is based on social sentiment, with metrics including Twitter likes, Reddit posts, website visits, financial news mentions, and job postings. AltIndex stock signals have a 75% win rate since inception. On average, this yields 6-month gains of 24% – which far outperforms the stock benchmark indexes. Prices range from $0 to $99 per month, depending on how many stock signals you want.
  2. Danelfin: This stock trading signal provider leverages artificial intelligence. It extracts and analyzes data from three core segments – fundamental, technical, and social sentiment indicators. It then generates an AI-powered score from 1 to 10. Danelfin claims that US stocks with an AI score of 10 outperform the market average by 20.08% over the following quarter. Since its inception in 2017, Danelfin has produced gains of 191%.
  3. The Robust Trader: This stock signals service was launched in 2013. It specializes in swing trading strategies on US-listed stocks. All trading decisions are quantitative-based, so there’s no human input. The Robust Trader charges $49 per month or $299.95 when paying annually. Signals are sent just before the US markets open for trading. The Robust Trader claims a historical win rate of 91.03%.
  4. Seeking Alpha: Seeking Alpha offers a popular stock signals service that specializes in long-term investing. You’ll receive just two signals each month and most positions remain open for at least six months. Since its inception in 2009, Seeking Alpha claims to have outperformed the S&P 500 by 20% each year. Seeking Alpha charges $199 per year. This is reduced to $99 in the first year.
  5. Mindful Trader: Mindful Trader is an established stock trading signal provider that specializes in quantitative data analysis. This provider will appeal if you’re interested in trading stock options and futures. According to 20 years’ worth of backtesting results, the Mindful Trader has averaged annualized gains of 141%. This is with an average account drawdown of 24%, meaning the Mindful Trader takes a high-risk approach to trading.
  6. TradeDots: This signals provider not only specializes in stocks but forex and cryptocurrencies too. It has developed a proprietary indicator that can highlight market reversals. TradeDots has integrated its service into a Telegram bot, meaning you’ll receive signal instructions in real-time. TradeDots claims to have a win rate of 94%.
  7. Zacks Ultimate: Zacks Ultimate is one of the best-performing stock signal services of all time. Since 1988, Zacks Ultimate has averaged annualized returns of 24.2%.  It covers both long and short-term investment strategies across many stock types. However, Zacks Ultimate won’t appeal to casual investors – it charges $299 per month or $2,995 on an annual plan.
  8. Market Chameleon: This signal service specializes in stock options. The provider looks for over or undervalued option prices and recommends trades accordingly. It covers many stock options strategies, including the debit iron butterfly, long calls, and short puts. Prices start from $69 per month and there’s a 7-day free trial available for new customers.

Reviewing the Best Stock Signals Providers

Rating the best stock trading signals requires many considerations. Not only past performance but also pricing, reputation, target markets, and risk. Read on to discover which stock market signals are right for you.

1. AltIndex – Overall Best Stock Trading Signals [Average 6-Month Gains of 24%] 

We found that AltIndex offers the best stock trading signals for 2024. AltIndex is one of the leading alternative data providers – meaning it takes an ‘outside the box’ approach. Instead of relying on earnings reports and fundamental news – AltIndex makes stock trading decisions based on social sentiment. There is no human input, as AltIndex leverages emerging technologies.

For example, it uses machine learning and natural language processing to extract data from social media and other websites. It then uses artificial intelligence to analyze the data and convert it into investment insights. For instance, suppose Apple has just released a new product but there are still two months before its earnings report.

AltIndex review

AltIndex can assess whether the product launch was a success by evaluating social media metrics. It can also assess website visits, app downloads, and other relevant data. Based on its analytical findings, AltIndex ranks stocks from 0 to 100. Stocks with a high ranking score suggest a ‘Strong Buy’ and a solid possibility of outperforming the markets.

As a member, you’ll receive a notification in real-time once a stock signal has been generated. Signals are sent directly to your email – so make sure you have notifications switched on. AltIndex has produced impressive results since launching its stock signal service. Since its inception, it has had a win rate of 75%. AltIndex explains that on average, it generates returns of 24% every six months.

AltIndex stock signals

This far outperforms stock benchmarks like the Dow Jones Industrial Average and the S&P 500. Although AltIndex has a solid track record, prices are competitive. The ‘Starter’ plan gets you 10 stock signals each month and costs $29 per month. The ‘Pro’ plan gets you 25 stock signals and costs $99 per month. There’s also a free plan, but this is capped to just 1 monthly stock signal.

The paid plans do not come with a money-back guarantee, which is a drawback. That said, all pricing plans are flexible so you can cancel at any time. In terms of supported markets, AltIndex specializes in US-listed stocks. It also covers some of the best cryptocurrencies, including Bitcoin, Litecoin, Ethereum, and Cardano.

Performance 75% win rate since inception. Average 6-month gains of 24%.
Signal Frequency Up to 25 stock signals per month
Strategy Long-term investing
Pricing Three plans to choose from, ranging from $0, $29, and $99 per month. Each plan gets you 1, 10, or 25 signals per month, respectively.
Free Stock Signals 1 per month
Markets US stocks, Bitcoin, and some of the best altcoins

Pros pros

  • 75% win rate since inception – converting to average 6-month gains of 24%
  • Receive up to 25 stock trading signals each month
  • Leverages artificial intelligence and alternative data to outperform the market
  • Utilizes a long-term strategy – so you won’t need to be too active

Cons cons

  • $99 per month might not offer a suitable return on investment for budget investors
  • Doesn’t support stocks outside of the US

2. Danelfin – AI-Powered Stock Signals With 191% Gains Since January 2017  

Danelfin is a stock trading signal provider that specializes in explainable artificial intelligence. It collects over 10,000 data points from thousands of individual stocks every day to generate an AI score. This includes fundamental, technical, and sentiment indicators. The AI score ranges from 1 to 10 – with 10 representing a strong buy.

According to Danelfin, US-listed stocks with an AI score of 10 have a strong probability of outperforming the 3-month market average by 20.08%. Conversely, stocks with an AI score of 1 will likely underperform the 3-month market average by 30.92%. Since its inception in January 2017, Danelfin’s stock signals have produced gains of 191%. Over the same period, the S&P 500 has grown by 118%.

Danelfin review

In addition to US-listed stocks, Danelfin also covers the European markets. It also offers ETF signals. Danelfin offers a free plan that comes with limitations – just two trade ideas are sent each month. This increases to 25 trade ideas on the ‘Plus’ plan, which costs $25 per month. For unlimited trade ideas, you’ll need the ‘Pro’ plan at $70 per month. Discounts are available on annual plans.

Performance 191% growth since its inception in January 2017.
Signal Frequency Daily emails with updated AI-powered stock rankings.
Strategy Medium-term strategy with signals based on a 3-month outlook.
Pricing Prices range from $0, $25, and $70 per month based on the number of trade ideas you require.
Free Stock Signals 2 per month
Markets Thousands of US/European stocks and ETFs

Pros pros

  • One of the best AI stock picker services for performance
  • 191% growth since January 2021
  • Supports thousands of stocks and ETFs from the US and Europe
  • 50% discount available on the first three months of signing up

Cons cons

  • The free plan limits you to just 2 trade ideas per month
  • Standard monthly price of $70 on the ‘Pro’ plan

3. The Robust Trader – Established Swing Trading Signals Provider Specializing in Quantitative Data  

Launched in 2013, The Robust Trader is an established stock trading signals provider. It focuses exclusively on quantitative data, meaning there is no human input when generating signals. Moreover, The Robust Trader specializes in swing trading strategies. This means its signal suggestions can remain open for days or weeks.

The idea is to find quantitative trends and buy or sell stocks accordingly. For example, one of its strategies leverages the Relative Strength Index (RSI). When the RSI reading is below 30 for three days in a row, The Robust Trader will consider entering a buy position. This highlights that the stock is witnessing a temporary pullback. When the RSI surpasses 50, The Robust Trader will exit the position.

The Robust Trader review

The Robust Trader is a US-centric provider – with signals being posted before the NYSE and NASDAQ open for trading. This means that investors in Europe and further afield might need to consider an alternative provider. When it comes to past performance, The Robust Trader claims a historical win rate of 91.03%. However, it doesn’t provide any data regarding average monthly gains.

Fortunately, The Robust Trader offers a one-month trial for $1. If you find its stock buy signals don’t meet your expectations, you can cancel the plan before the trial period is over. If you do wish to continue, The Robust Trader charges $49 per month. Alternatively, you can purchase an annual plan for $299.95. This reduces the monthly cost to just $25.

Performance Claims a 91.03% win rate since inception. Average return on investments are not provided.
Signal Frequency Signals are sent before the US markets open for trading.
Strategy Swing trading
Pricing $49 per month or $299.95 annually.
Free Stock Signals None – but offers a one-month trial for $1.
Markets US stocks

Pros pros

  • Established stock trading signals provider since 2013
  • Utilizes quantitative data to generate swing trading strategies
  • Claims a 91.03% win rate since inception
  • Offers a one-month trial for just $1 with full functionality

Cons cons

  • Signals are sent before the US stock market opens – so will only appeal to North American investors
  • Does not provide data on average monthly returns

4. Seeking Alpha – Buy-and-Hold Stock Signals for Long-Term Investors    

Seeking Alpha offers some of the best stock trading signals for long-term investors. On average, you will receive just two signals each month. This means that you’ll be investing semi-passively, as you won’t need to actively place trades. Seeking Alpha signals remain in place for at least six months – but often a few years.

Therefore, Seeking Alpha looks for value stocks with long-term potential. Seeking Alpha has a full-time analysis team tasked with finding stock recommendations. The team focuses on fundamental data, such as earnings, forward valuations, and momentum in relation to the broader sector.

Seeking Alpha review

In addition to its monthly stock signals, you’ll also receive updates on outstanding positions. This includes an updated stock rating for previous picks. For example, if a stock has been downgraded to a ‘Sell’ – you’ll be notified straight away. Seeking Alpha also runs regular webinars to outline its market insights and projected trends.

In terms of performance, Seeking Alpha claims to have outperformed the S&P 500 by 20% every year since its inception. This is impressive, considering Seeking Alpha launched its signals service in 2009. However, it doesn’t provide specific average returns, which is a drawback. Another drawback is that Seeking Alpha only offers annual plans. You’ll pay $199 annually, which is reduced to $99 in year one. Seeking Alpha also offers a 14-day free trial.

Performance Claims to have outperformed the S&P 500 by over 20% every year since its inception in 2009.
Signal Frequency Two signals per month.
Strategy Long-term buy-and-hold investing.
Pricing $199 per year. Reduced to $99 in year one.
Free Stock Signals None – but offers a 14-day free trial.
Markets US and international stocks from multiple sectors.

Pros pros

  • One of the best stock trading signals providers for long-term investors
  • Just two buy-and-hold signals are sent each month – ideal for passive investing
  • Established reputation that dates back to 2009
  • Has outperformed the S&P 500 benchmark by 20% since inception

Cons cons

  • Doesn’t offer a specific return on investment
  • Only offers annual plans

5. Mindful Trader – Data-Focused Trading Signals Provider for Stock Options and Futures    

Mindful Trader is a popular signals provider that specializes in stock options and futures. The service is run by Eric Ferguson – an experienced statistical analyst. The Mindful Trader has an average trade duration of 10 days, so sits within the swing trading category.

All of the stock signals generated are based on quantitative data. This is based on price movement trends and historical probabilities. The Mindful Trader offers 20 years’ worth of backtesting results on its website. The results show an average annualized gain of 141% – which is huge. However, considerations need to be made.

Mindful Trader review

First, these results are based on an average account drawdown of 24%. This means that on average, the account balance is 24% below its peak before recovering. In other words, the strategy deployed by the Mindful Trader should be considered risky. What’s more, backtesting results are based on historical data. There is no guarantee that history will repeat itself.

That said, the Mindful Trader has excellent ratings in the public domain. For example, the Mindful Trader is rated 5/5 on Google, and 4.9/5 on The Stock Dork. Benzinga rates the service 4.5/5. Moreover, the Mindful Trader is competitively priced. You’ll pay $47 per month and you can cancel at any time. However, there’s no free trial or money-back guarantee.

Performance Based on 20 years of backtesting, average annualized gains of 141%.
Signal Frequency No set frequency, but generally a few signals per week. Signals are usually sent at 6:30 a.m. Pacific Time.
Strategy Swing trading
Pricing $47 per month
Free Stock Signals None
Markets US-listed stock options and futures

Pros pros

  • 141% average annualized gains based on 20 years’ worth of backtesting
  • Swing trades stock options and futures
  • Signals are sent as soon as Eric Ferguson places a trade
  • Transparent methodology explains its quantitative analysis methods

Cons cons

  • Average account drawdown of 24%
  • Does not offer a free trial or money-back guarantee

6. TradeDots – Multi-Asset Signals Service Specializing in Market Reversals      

TradeDots is a signal provider that not only offers stock trading suggestions but also covers forex and cryptocurrencies. It has developed proprietary software that can be uploaded as a TradingView indicator. The indicator is tasked with finding potential market reversals. TradeDots utilizes a price action strategy that covers long and short positions.

So, when the indicator believes that a bullish trend is about to reverse, the signal will suggest going short. And vice-versa on bearish trends. This means that you can profit from both rising and falling markets. TradeDots’s indicator is very easy to understand. If the indicator flashes green, this means you should go short. Conversely, a red signal means you should go long.

TradeDots review

Crucially, TradeDots has now integrated its TradingView signal into a Telegram bot. This completely automates the process, as the Telegram bot will send you a notification when it’s time to buy or sell. In terms of performance, TradeDots claims to have a historical win rate of 94%.

We could not verify these claims independently. TradeDots offers a free trial, allowing you to test its signals before making a financial commitment. However, the free trial only lasts for a week, which might not be long enough. After the free trial, you’ll need to pay $54.99 per month to remain a customer.

Performance Claims to have a historical win rate of 94%.
Signal Frequency Not stated.
Strategy Price action trading with a focus on potential trend reversals. Suitable for scalping and swing trading, depending on the asset.
Pricing $54.99 per month
Free Stock Signals None – but offers a 7-day free trial
Markets Stocks, forex, and cryptocurrencies

Pros pros

  • Proprietary software that signals potential market reversals
  • Completely automated – signals are sent via a Telegram bot
  • Supports multiple asset classes – including stocks, forex, and cryptocurrencies
  • Claims to have a 94% win rate

Cons cons

  • Past performance claims are not backed by verifiable data
  • You’ll need to be comfortable short-selling assets – which won’t suit all risk profiles

7. Zacks Ultimate – Average Annualized Gains of  24.2% Since 1988

If you’re prepared to spend big for the best stock trading signals for past performance, Zacks Ultimate is worth considering. The service was established in 1988 and since then, has generated average annualized gains of 24.2%. This is an incredible feat that far outperforms the S&P 500 benchmark.

According to Zacks Research, a $10,000 investment in 1988 would now be worth $22.7 million. This is based on monthly rebalancing, dividend reinvesting, and compounded growth. In other words, if you followed Zacks Ultimate’s recommendations like-for-like. Now for the bad news – Zacks Research costs $299 per month.

Zacks Ultimate review

Although a slight discount is available when paying annually, this will set you back $2,995. Unless you’re planning to invest large amounts, the return on investment likely isn’t there. For instance, an annual investment of $10,000 at 24.2% would yield gains of $2,420. Less than subscription and brokerage fees, you’d still be making a loss.

Performance Average annualized gains of 24.2% since 1988.
Signal Frequency No set frequency but daily emails are sent with intraday trades and market insights.
Strategy Covers both long and short-term strategies across many stock types.
Pricing $299 per month or $2,995 on an annual plan.
Free Stock Signals None – but offers a 30-day trial for $1.
Markets Small, medium, and large-cap stocks.

Pros pros

  • Average annualized gains of 24.2% since its inception in 1988
  • Covers small, medium, and large-cap stocks
  • Daily emails containing intraday trades and market insights
  • 30-day trial for just $1

Cons cons

  • Plans cost $299 per month or $2,995 annually
  • You’ll need to invest large amounts to make a suitable return on investment

8. Market Chameleon – Stock Options Signals Covering Multiple Trading Strategies

Market Chameleon is also one of the best stock trading signals providers if you want to trade options. It specializes in large-cap companies that trade on the US markets. This includes NVIDIA, Tesla, Costco, Apple, and Amazon. It also targets index options, including the NASDAQ 100 and S&P 500.

Market Chameleon covers many strategies, including bull call spreads, long puts, and the debit iron butterfly. The provider looks for over or undervalued option prices, giving you an edge in the market. For example, it currently recommends a long call trade on Apple options. Does this align with most AAPL stock price predictions in 2024?

Market Chameleon review

While the market price is $0.95, Market Chameleon believes the theoretical value is $1.94. This offers a 104.4% edge based on the upside target. In terms of pricing, its options trading signals cost $69 per month. This includes many other features, such as dividend announcements, premarket stock screeners, and closed-end fund comparisons.

You’ll also get historical price return distributions, big money stock flows, and intraday updates. The main drawback of Market Chameleon is that it doesn’t publish its historical results. That said, it does offer a 7-day free trial. Although not long enough to test its signal performance, you’ll get a feel of how the service works.

Performance Not published.
Signal Frequency No set frequency, but signals are posted on most trading days.
Strategy Compares the current and theoretical value of options to find over or undervalued prices. Most positions are short-term trades.
Pricing $69 per month.
Free Stock Signals None.
Markets Options covering a small selection of large-cap stocks and ETFs.

Pros pros

  • One of the best stock trading signals providers for options
  • Covers many options strategies – including long puts and bull call spreads
  • Trades options prices based on their current and theoretical values
  • Premium plans come with lots of technical and fundamental research tools

Cons cons

  • Does not publish its historical returns
  • You’ll need a basic understanding of options trading strategies

Our Methodology When Rating the Best Stock Trading Signals?

There are many stock trading signal services in the market, each with a different target audience. Moreover, each stock trading service comes with a set of pros and cons – allowing us to develop a meticulous methodology. This enabled us to rank the best stock trading signals in the market right now.

For example, we initially focused on the reputation of the signal provider. This included its track record in the market, how long it has been operating, and how current and past customers rate the provider on third-party review sites. We also examined the past performance of the stock trading signals.

We focused on signals that consistently outperform the market benchmarks – such as the S&P 500. That said, we also assessed whether the stated past performance can be verified independently. In addition, our methodology also considered the signal frequency, what timezone the provider operates, and how active you’ll need to be. We also examined the provider’s strategy.

For instance, some signals opt for long-term value while others day trade stock volatility. Pricing was also an important metric for our methodology. We considered the potential return on investment based on the monthly subscription price and historical returns to date. This determines whether the stock signals offer good value for money.

What are Stock Trading Trading Signals?

Stock trading signals are popular with investors who don’t have the time or experience to make investment decisions. In simple terms, signals tell you exactly what stocks to buy and sell. Otherwise called stock trading tips, picks, or recommendations, signals offer a more passive way to invest in the markets.

Traditionally, stock signals were generated by expert traders with many years of success in the industry. The signal provider would manually research fundamental data, such as earnings reports and financial news. Others focus on technical analysis with indicators like the RSI and Elliott Wave. Either way, the analyst would send a stock signal once they found a suitable trading opportunity.

AltIndex review

However, the markets have since evolved – the best stock trading signals are now generated from emerging technologies. This includes artificial intelligence, machine learning, and even natural language processing. The concept is simple – these technologies have far greater capabilities when compared to human processes.

In addition, some providers are using alternative data to generate stock market trading signals. This creates trading suggestions based on social sentiment analysis – such as how consumers feel about a particular company or brand. Alternative data also looks at website analytics, news mentions, app downloads, and other social metrics.

Irrespective of how the trading suggestions are generated, signals remove the need for you to personally research the markets. Once you receive a signal, you’ll be told which stock to invest in. If the provider takes a short-term strategy – like swing trading or scalping, the signal will likely include a stop-loss and take-profit order. This won’t be the case if you’re investing in a long-term position.

Real-World Example of a Stock Trading Signal

Here’s a real-world example of a stock trading signal sent to premium members at AltIndex:

  • On January 5th, 2023 – AltIndex sent a buy signal on DraftKings stock.
  • At the time, the DraftKings stock price was $11.48.
  • The signal was kept open until April 1st, 2023. On this date, AltIndex sent a sell signal – meaning members should close the position.
  • The DraftKings trade was closed at $19.35 – resulting in a 68.6% profit.

How do Stock Buy and Sell Signals Work?

The stock signal process can vary depending on the provider and the strategy being deployed. However, in most cases, you’ll be notified via email, SMS, or Telegram once a signal has been generated.

  • For example, suppose you’re using AltIndex’s stock signal service. This provider extracts alternative data from multiple sources to assess consumer sentiment.
  • It does this through machine learning and artificial intelligence, which then generates a ranking score. Once AltIndex finds a trading opportunity, it sends a signal via email. For instance, you might be told to invest in IBM stock.
  • AltIndex takes a medium-term approach, with forecasts based on the next three months. Crucially, when AltIndex believes it’s time to sell IBM stock, you’ll receive a signal in real-time.
  • This ensures that you can buy and sell stocks without needing to actively monitor the market.

Some stock signal services take a much shorter-term approach. For instance, Mindful Trader analyzes quantitative data to find swing trading opportunities. On average, positions remain in place for just 10 days. You’ll receive a stock signal before the market opens with a suggested stop-loss and take-profit price. This protects your bankroll if the trade doesn’t go to plan, or locks in your profits once the target price has been hit.

There are also stock signal providers that take a much longer-term approach to investing. For example, Seeking Alpha sends just two stock signals each month. You’ll be holding each stock for at least six months – but often for several years. This will appeal to long-term investors who want to build value over time.

How to Choose the Best Stock Trading Signals Provider?

Choosing the right stock signals app is an important process. You’ll need to consider many factors, such as past performance, pricing, trading strategies, and the provider’s time zone.

Let’s take a closer look at these factors, which will allow you to make an informed decision.

Past Performance

The past performance of a stock signal service will give you an idea of what to expect. Some signal providers display a win rate percentage. This highlights what percentage of signals return a profit. For example, suppose the provider has a win rate of 80%. If it’s sent 1,000 signals since its inception, 800 yielded a profit.

AltIndex past results

However, the win rate alone doesn’t specify what gains the signal provider has made. This is because each individual signal will have its own profit or loss percentage. As such, we prefer signal providers that display average annualized returns.

For example:

  • Zacks Ultimate claims to have produced average annualized gains of 24.2% since 1988.
  • AltIndex provides results based on a 6-month average. This currently stands at 24%, which converts to 48% annually.

Crucially, the average historical returns should be higher than the market average. This is usually compared to an index benchmark like the S&P 500 or Dow Jones. If the signals aren’t outperforming the benchmarks, then it doesn’t make sense to subscribe. After all, you could just invest in index funds themselves without paying a monthly subscription fee.

The Importance of Testing Stock Signals With Demo Funds 

  • We came across many stock signal services that make bold claims about how much money they make. However, it’s often difficult to verify these claims.
  • As such, it’s important to test a stock signal service through a demo account before risking any money.
  • The best online stock brokers offer a free demo account that mirrors live market conditions. This includes eToro and Webull, but many others exist.
  • Whenever you receive a new signal, you can buy or sell the stock with demo funds. You can repeat the process for several weeks to assess how the signals are performing.
  • If you’re happy with the results, you might then consider trading the signals with real capital. If not, you can cancel your signal subscription.

Signal Time Zone 

Some signal providers operate on specific time zones. This is usually the case if the signal provider requires human input. For example, although Mindful Trader utilizes quantitative analysis methods, signals are sent manually.

Mindful Trader usually sends signals at 6:30 a.m. Pacific Time – which is just before the US markets open. This means that traders from other regions – such as Asia, will receive signals at unfavorable times. Therefore, you should assess what times the provider sends signals to ensure they align with your location.

That being said, if the signal provider takes a long-term strategy, time zones become less important. This is because you’ll be holding the stock for several months or years. As such, missing the entry point by a few hours won’t have a major impact on your investment returns.

Signal Strategy and Frequency  

Not all signal providers are suitable for passive investors. On the contrary, some services require you to actively trade the markets. This won’t be suitable if you have commitments, such as full-time employment.

For example, suppose you opt for a stock signal service that specializes in intraday trading. This means once you receive a signal, the trade will only remain in place for several hours or minutes. In other words, you’ll need to place the entry signal as soon as it arrives. If the provider doesn’t specify an entry price, you’ll need to manually close the trade when the sell signal arrives later in the day.

AltIndex signals

If you’re looking for a more hands-off approach, you’ll want to choose a signals provider that takes a longer-term strategy. For example, based on its published results, AltIndex signals remain open for 3-6 months on average. Seeking Alpha takes an even longer approach, with signals remaining open for at least 6 months – but usually more than a year.

The frequency at which signals are received should also be considered. For example, if you’re receiving multiple signals each day, this can make it challenging to act on them in good time.

Target Stock Markets   

You should also consider what markets the stock signals target. For example, most signal providers trade large-cap stocks listed in the US. This includes the likes of Apple, Tesla, Microsoft, and Amazon. Large caps come with less volatility and tighter spreads – making it easier to enter and exit the market.

However, some signal providers specialize in low-cap stocks. Not only do you need to consider the increased risks, but not all online brokers support low caps. In addition, some providers focus on stock options and futures. Once again, these are more volatile when compared to traditional large-cap stocks – so consider the risks.

You might also find that some signal providers cover non-US stocks. This might include stocks in Europe or Asia. Either way, you’ll need to ensure your broker supports these markets and that they align with your financial goals.

Pricing and Return on Investment   

The best stock trading signals allow you to outperform the market without doing any research or analysis. However, you’ll need to pay monthly fees to access the service.

What is a Stock Benchmark? 

  • Stock benchmarks allow you to assess investment returns against the market average.
  • In most cases, the S&P 500 is the de-facto benchmark when investing in stocks. This is because the S&P 500 tracks 500 large-cap stocks and has been active since 1926.
  • Suppose the S&P 500 generates returns of 8% in one year. When using a stock signal service, you’ll want to make more than 8% to make the process worthwhile.
  • That said, the S&P 500 won’t always be the most suitable benchmark to use. For example, if your signals provider specializes in low-cap stocks, the Russell 2000 benchmark will be more relevant. This is because the Russell 2000 tracks 2,000 small-cap stocks listed in the US.

As such, you’ll need to ensure the subscription offers a suitable return on investment. This can be determined based on the monthly fee and projected returns.

  • For example, suppose you opt for the AltIndex ‘Starter’ plan, which costs $29 per month. Based on historical results, AltIndex signals average 24% returns over a 6-month period.
  • Let’s say you invest $1,000 per month into its signals over a 6-month period. Your total outlay is $6,000, so at 24%, that’s gains of $1,440.
  • You’ve also spent $174 (6 months x $29) on AltIndex subscription fees. This leaves you with $1,266 worth of investment gains. This represents a solid return on investment.
  • However, if you only invested $100 per month into the markets, your investment gains wouldn’t cover the subscription cost. This means you’d be making a loss – even on 6-month growth of 24%.

Ultimately, if you’re only investing a few dollars each month, then stock signals might not be right for you. To reiterate – your returns should outperform the broader benchmarks after you’ve accounted for subscription and brokerage fees.

Can You Really Make Money with Stock Trading Signals?

There are many stock trading signal services that make consistent gains. In fact, the best providers consistently outperform the broader markets. However, not all signal services make money. Moreover, we came across signal services that make bold claims on their historical returns without providing any credible data to back this up.

Your ability to make money from stock signals will also depend on your capital resources. This is because you need to factor in the cost of the signal subscription. If you’re investing large amounts and the signals generate a sizable return, you could make good money. But if you’re investing small amounts, you might not be making enough to cover the subscription.

This is why you need to analyze the projected return on investment before paying for a signal service. You should also remember that historical returns are averaged out over time. For instance, suppose a signal service has made average annualized returns of 20% since its inception a decade ago. In one year, the service might make 30%. In the next year, it might make a 10% loss.

If the signals service provides its average drawdown percentage, this can help you assess affordability. For example, the Mindful Trader has an average drawdown of 24%. This means that when Mindful Trader goes on a prolonged losing run, its portfolio averages a 24% decline from the previous peak. To counter drawdown risks, you’ll need to ensure you have sufficient capital and that you avoid cashing out too often.

Conclusion

In summary, stock signals give you the opportunity to outperform the broader markets passively. Your signal provider will tell you which stocks to trade and when.

Overall, we found that AltIndex offers the best stock trading signals for beginners – especially those on a budget. Monthly subscription fees start from just $29 and AltIndex has produced average 6-month gains of 24% since its inception.  All AltIndex signals are powered by AI – so there’s no human subjectivity or emotions.

References

FAQs

Do professional stock traders use signals?

Are stock signals reliable?

How do you get stock trading signals?

What is the best stock trading signals provider?

Kane Pepi
Editor
Kane Pepi
Editor

Kane Pepi is an accomplished financial and cryptocurrency writer who has an extensive portfolio of over 2,000 articles, guides, and market insights. With his expertise in specialized subjects such as asset valuation and analysis, portfolio management, and financial crime prevention, Kane has built a reputation for providing clear explanations of complex financial topics. He holds a Bachelor's Degree in Finance and a Master's Degree in Financial Crime, and is currently pursuing his Doctorate degree, which focuses on investigating the complexities of money laundering in the cryptocurrency and blockchain technology sectors. Kane's wealth of knowledge and experience in the field make…