Stock tipsters are a dime a dozen in Hong Kong. Sky Cheung Shi-gaii at least has the dubious distinction of being the first to be punished by the Securities and Futures Commission. The broker was found using his investment column in Apple Daily between 2008 and 2010 to recommend stocks in which he took positions using his wife's undisclosed trading account. He was fined HK$500,000, the amount of profit he made from his illicit trades and has been suspended from working in the investment industry for 30 months. In several instances, he deliberately delayed publication of favourable comments until he had bought the stocks in his wife's account. Cheung no doubt deserves his punishment. It's curious, though, that he was only asked to cough up his ill-gotten gains and not made to pay a stiff fine as well. Nevertheless, the commission is to be applauded for being vigilant against such tipsters, whose investment advice dominates the business sections of local newspapers and the airwaves, and has significant influence on retail investors. The penalities against Cheung should serve as a deterrent to others. But their influence is undeserved. If they are really so smart, shouldn't they be running their own investment funds and charge clients top dollar instead of giving out free advice? In any case, study after study has found it is basically impossible to predict the short-term movements of stocks and of the market in general. Yet, many pretend to know where stocks are heading in the days and weeks ahead. The commission has rules mandating that investment writers disclose whether they or close relatives hold stocks they discuss. There is nothing wrong if they personally invest in stocks they recommend so long as they have made proper public disclosure. If anything, it shows conviction by putting their money where their mouths are. But Cheung was found to have made false disclosure and hid his wife's account. If he had been more honest, he might have made a decent tipster in light of his sizeable but illicit profit.