Penny Stocks? Good idea for $$$?

[Jubv]

Penny stocks can give you a great ROI but are very risky so I'd only recommend them if you have spare money that you don't really care about losing. In contrast to this, index funds might are a safer, more long-term option that you will benefit more from.

I would recommend checking out the sites posted by TZ2011 and also babypips.com, which is forex related but will help you regardless if you're looking into trading or investing.

Bottom line: stay away from penny stocks for now, learn all you can about investing/trading and stick to safer options even though they will give you a smaller ROI.

 

[johnny_wadd]

Hi there. The problem with penny stocks is that a high majority of them are very risky due to a few factors.

*They tend to be companies on the slide out of the market
*They are companies that are almost bankrupt.
*They are unprofitable companies that are desperate to raise capital and will grab your money to do so.

However, it's not all doom and gloom! A lot of penny stocks can be...

*New start up companies
*Overlooked and undervalued companies
*The next microsoft / facebook /Google etc

Now the interesting part here is how you separate out the good from the bad. In fact that is the most difficult and time consuming aspect here and this is what the majority of people fall down on! YOU HAVE TO DO YOUR DUE DILLEGENCE AND LOOK INTO EVERY ASPECT OF THE FIRMS FINANCIALS TO SEE WHAT SHAPE THE COMPANY IS IN BEFORE YOU EVEN THINK ABOUT THROWING A DIME IN ITS DIRECTION!!!

A free way to start looking into a companies financials is via Yahoo finance. This will show you the companies profits loss and all the other details you need to know.

Now NEVER EVER sign up for a free penny share news letter! They will send you lists of shares that they'll claim are the next Google Microsoft etc. They will hype and hype these companies and people will jump on board and buy shares. After a few months of this the share prices will climb and climb. Then the promotion stops the bad guys pull out taking their profits with them, and the shares fall down to the ground! You and the other punters are left with huge losses. This is what is termed as PUMP AND DUMP! DO NOT EVER GET INVOLVED WITH ANYTHING LIKE THIS YOU WILL LOSE MONEY!

Now we've got cash in our pockets how the hell do we find a share that's worth investing in out of a sea of millions? Fortunately there is the odd one or two people on the net that do provide solid though not infallible advice via a yearly subscription to a news letter. Iam in no way associated to this guy and you can try out his news letter for free I think his name is Peter Leeds you can Google him. I also recommend his books and another personal favourite of mine and again its not a commercial plug "the naked traders guide by Robbie burns' In his book he describes a traffic light system he uses on a site called ADVFM to pick his shares. I think that a combination of Peter Leeds stock picks and the combination of the naked traders traffic light system is a pretty decent way of checking out if a penny stock is worth investing in.

I hope this information has been helpful to you.

P.s You could always do a bit of virtual paper trading there are lots of sites on the net and the brokerages also provide paper trading platforms for their customers to use. I should tell you that paper trading is like playing the stock market in real time but with imagenary money so you get a feel for trading without risking any real money.

 

[helloboy111]

Hi there. The problem with penny stocks is that a high majority of them are very risky due to a few factors.

*They tend to be companies on the slide out of the market
*They are companies that are almost bankrupt.
*They are unprofitable companies that are desperate to raise capital and will grab your money to do so.

However, it's not all doom and gloom! A lot of penny stocks can be...

*New start up companies
*Overlooked and undervalued companies
*The next microsoft / facebook /Google etc

Now the interesting part here is how you separate out the good from the bad. In fact that is the most difficult and time consuming aspect here and this is what the majority of people fall down on! YOU HAVE TO DO YOUR DUE DILLEGENCE AND LOOK INTO EVERY ASPECT OF THE FIRMS FINANCIALS TO SEE WHAT SHAPE THE COMPANY IS IN BEFORE YOU EVEN THINK ABOUT THROWING A DIME IN ITS DIRECTION!!!

A free way to start looking into a companies financials is via Yahoo finance. This will show you the companies profits loss and all the other details you need to know.

Now NEVER EVER sign up for a free penny share news letter! They will send you lists of shares that they'll claim are the next Google Microsoft etc. They will hype and hype these companies and people will jump on board and buy shares. After a few months of this the share prices will climb and climb. Then the promotion stops the bad guys pull out taking their profits with them, and the shares fall down to the ground! You and the other punters are left with huge losses. This is what is termed as PUMP AND DUMP! DO NOT EVER GET INVOLVED WITH ANYTHING LIKE THIS YOU WILL LOSE MONEY!

Now we've got cash in our pockets how the hell do we find a share that's worth investing in out of a sea of millions? Fortunately there is the odd one or two people on the net that do provide solid though not infallible advice via a yearly subscription to a news letter. Iam in no way associated to this guy and you can try out his news letter for free I think his name is Peter Leeds you can Google him. I also recommend his books and another personal favourite of mine and again its not a commercial plug "the naked traders guide by Robbie burns' In his book he describes a traffic light system he uses on a site called ADVFM to pick his shares. I think that a combination of Peter Leeds stock picks and the combination of the naked traders traffic light system is a pretty decent way of checking out if a penny stock is worth investing in.

I hope this information has been helpful to you.

P.s You could always do a bit of virtual paper trading there are lots of sites on the net and the brokerages also provide paper trading platforms for their customers to use. I should tell you that paper trading is like playing the stock market in real time but with imagenary money so you get a feel for trading without risking any real money.

Thank you very informativ. Yes I heard from Peter Leeds and I thought he is the same scamguy as Timothy Sy***. I will look into it

 

[johnny_wadd]

Hi, Peter does a lot of T.V work for CNN and other prestige networks in the US. And I personally tested him out a little by asking his advice on a dodgy share that a P&D site sent me. He told me straight that the share was a pump and dump, confirming my overall suspicions.

 

[konak]

You watched too much Wolf Of Wall Street

i bet he did........

 

[Wania]

You might as well just go to casino and put all on red. bam! 50% ROI in 3 minutes.

The only difference between penny stocks and roulette is that in penny stocks rules stacked even more aganist you - unlike green zero on table which gives you slightly less than 50% chance to succeed, on stock market you're playing aganist huge corporations with developed R&I divisions. Those companies are listed for pennies for a reason - do you REALLY think you can see something that those big hedge funds dont?

 

[igniteimages]

Some great advice from others.

Realise that there is a reason that penny stocks are only worth pennies - the companies are in trouble!

Remember the spreads can be very high on the stocks, so even if they rise in value you may not see it all, or anything.

If you do go ahead I also suggest you experiment with a paper exercise firstly.

 

[helloboy111]

i bet he did........

No i haven't seen the film yet.

 

[helloboy111]

Hi, Peter does a lot of T.V work for CNN and other prestige networks in the US. And I personally tested him out a little by asking his advice on a dodgy share that a P&D site sent me. He told me straight that the share was a pump and dump, confirming my overall suspicions.

Maybe I "buy" his book

 

[johnny_wadd]

Some great advice from others.

Realise that there is a reason that penny stocks are only worth pennies - the companies are in trouble!

Remember the spreads can be very high on the stocks, so even if they rise in value you may not see it all, or anything.

If you do go ahead I also suggest you experiment with a paper exercise firstly.

Yes, paper trading is definitely the way to go! Also, you have to take into account the brokerage fees for trading. If you do to many trades these fees can really cut into your profit margins. At the end of the day I suppose you have to sit down and ask yourself what kind of trader you intend to be? Will you be a short time day trader or scalper trying to do as many trades as you can for razor thin profit margin? Most people fail at this because you have to be BLOODY GOOD AT IT! Or are you going to be a more sit back and watch your investment grow(so long as you've chosen a decent share) that is. A lot of penny stock traders tend to fall into the long term category for obvious reasons. And once your investment is on the up, you could always thrown in a stop loss order to lock your profits in at a certain level. But again, it all boils down to RESEARCH RESEARCH RESEARCH and it's not an exact science!

 

[PureBlack]

play roulette instead, bet on one color, 50% of doubling your money, 50% losing it all, still a higher chance than what you will have with penny stocks.

 

[jstover77]

If I am going to gamble, I'll play blackjack.

Probably will have a better statistical chance of making money than putting it into penny stocks.

play roulette instead, bet on one color, 50% of doubling your money, 50% losing it all, still a higher chance than what you will have with penny stocks.

Not 50/50. Most roulette tables in US have double zeros, which makes the house odds over 5%. With proper BJ play, the house only has a .5% edge on the player and there are ways to diminish house edge to 0% or in the favor of the player (dealer staying on soft 17, amount of decks, certain double down situations and of course card counting).

 

[helloboy111]

play roulette instead, bet on one color, 50% of doubling your money, 50% losing it all, still a higher chance than what you will have with penny stocks.

Oh yes thanks for this... very valuable...

 

[Digitalist]

Before diving into any level of investing, be sure to spend some serious time reading into the subject. You could check out investopedia (google it), run some simulations using their system (which was free last time i checked) to play around and see what types of returns you can come up with given a specific budget that you set. I did this with a few friends from work to see who could manage the portfolio of 100k over a 3 month period and generate the highest ROI during that time frame. The only downside to this is you are playing with larger numbers than you can typically afford and any profits you make are not real The whole point is to equip yourself with tools for success and the understanding of how the market works. Look at the big funds out there- they have returns in the 6-8% annually (plenty outside of this range but this is a reasonable ROI in my eyes).

Personally if you actually have extra money, invest in a nice vacation for yourself then come back revived and ready to make even more money.

 

[helloboy111]

Before diving into any level of investing, be sure to spend some serious time reading into the subject. You could check out investopedia (google it), run some simulations using their system (which was free last time i checked) to play around and see what types of returns you can come up with given a specific budget that you set. I did this with a few friends from work to see who could manage the portfolio of 100k over a 3 month period and generate the highest ROI during that time frame. The only downside to this is you are playing with larger numbers than you can typically afford and any profits you make are not real The whole point is to equip yourself with tools for success and the understanding of how the market works. Look at the big funds out there- they have returns in the 6-8% annually (plenty outside of this range but this is a reasonable ROI in my eyes).

Personally if you actually have extra money, invest in a nice vacation for yourself then come back revived and ready to make even more money.

Yes I will look into further... didn't mean that i begin tomorrow.

 

[maleek]

To answer your question specifically... Penny stocks are really volatile in my opinion. Really not somewhere for a beginner to play

 

[sammie007]

I've dabbled with them in the past and let me tell you, there is heaps of money to be made...BUT do not touch it till you fulfill the following criteria (for your own good)

1. Have at least 5K. I blew through my 3K pretty fast...the less money you start with, the greater your chances of failure.

2. STUDY!, i can't stress this enough, sign up for Tim Sykes, Paul Scolardi or Cameron Fous, im not making any money for saying this but those guys have been extremely successful at penny stocks and learning their tricks will help you a lot.

3. PRACTICE! Before you put any real money into it, open up a free practice account with any broker and paper-trade for a few months. Once you are consistently profitable for a few months, go invest some real money on it.

Penny stocks is a high-risk high-reward game and if you're going in for the heck of it, you're most likely to lose your money but if you put a lot of time and study into it, you can make a killing of it...good luck!

 

[helloboy111]

I've dabbled with them in the past and let me tell you, there is heaps of money to be made...BUT do not touch it till you fulfill the following criteria (for your own good)

1. Have at least 5K. I blew through my 3K pretty fast...the less money you start with, the greater your chances of failure.

2. STUDY!, i can't stress this enough, sign up for Tim Sykes, Paul Scolardi or Cameron Fous, im not making any money for saying this but those guys have been extremely successful at penny stocks and learning their tricks will help you a lot.

3. PRACTICE! Before you put any real money into it, open up a free practice account with any broker and paper-trade for a few months. Once you are consistently profitable for a few months, go invest some real money on it.

Penny stocks is a high-risk high-reward game and if you're going in for the heck of it, you're most likely to lose your money but if you put a lot of time and study into it, you can make a killing of it...good luck!

Yes that's why I like penny stocks you can double your money in a day. Which of these guys do you think is the best?

 

[ashj1893]

There's a lot of people here speaking bad about trading because they're either just skeptics or suck at trading. Truth is, Penny Stocks are a great short term investment vehicle. Although I trade Binary Options, which I like MUCH better. As far as Penny traders, I would suggest sticking with Tim. Just do it. Although if you don't have a shit ton of money to start with, Binary Options are your best bet by far.

 

[Win10x]

Only do it if you have a passion for understanding the logic behind stock tracking. Otherwise, it's a waste of time and money.