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Avoid tout sheets and know whom you're taking advice from.

You find no shortage of investment and stock-picking newsletters that claim to have the inside track on the stocks you need to buy now. But some of these newsletters, known in the trade as tout sheets, have nefarious intentions.

Tout sheets are investment newsletters or websites distributed for the sole purpose of hyping stocks with exaggerated or false information to stir up investors’ interest. Tout sheets have proliferated due to the Internet, which makes distributing and promoting such things a cinch.

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