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How penny stock promoters work?

Discussion in 'BlackHat Lounge' started by puredemon, Dec 31, 2010.

  1. puredemon

    puredemon Newbie

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    Topic says it all. Anyone ideas on how those guys do promote the stocks?

    I want to know more specifically - from the bh marketing point of view - what has to be done. Cause the whole business can't be run just over e-mail marketing.
     
  2. PitchBlack*

    PitchBlack* Junior Member

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    Those guys that promote penny stocks are nothing but scam artists running pump and dump schemes. Driving up the price of the stock and dumping their share before the price drops.
     
  3. puredemon

    puredemon Newbie

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    and how do they do that?

    Do they just do it all over newsletters or how do they promote/ pump their stocks?
     
  4. teenmoney

    teenmoney Regular Member

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    A lot of it can be done through newsletters or message boards. There are stock message boards just like this very one we are on and if you claim you have the next greatest stock, there are plenty of people willing to buy.
     
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  5. puredemon

    puredemon Newbie

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    For me it's hardly to imagine that anyone buys a stock based on a message board recommendation. I lately heared of guys promotiong/ pushing through fb and other social networks.

    on the message boards are those stocks promoted by just publishing a press release or anything else?
     
    Last edited: Dec 31, 2010
  6. Alchemical

    Alchemical Registered Member

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    "pump and dump" is a very old game, and its played at all levels, from penny stocks to Enron, etc. There is a lot of money to be made, if you have money to start, are willing to be pretty deceptive, and willing to risk jail-time. Its pretty illegal and monitored by the SEC etc...that said, when the largest investment banks put out glowing or damning analysis of companies, and at the same time they buy and sell these stocks...that's pretty much pump and dump (or dump and short-sell).
     
  7. puredemon

    puredemon Newbie

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    so it's more like having a good written stock research and publishing it.
    and that's all?

    I mean I found articles like this: traderji.com/trading-psychology/837-deadly-art-stock-manipulation-pt1.html

    but that doesn't explain to me how exactly it is beeing promoted/ pumped. That's what I want to know. Any ideas?
     
    Last edited: Dec 31, 2010
  8. puredemon

    puredemon Newbie

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    No one able to help me?
     
  9. PitchBlack*

    PitchBlack* Junior Member

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    You can also promote offline, through telemarketing or maybe start a penny stock picking service and promote stocks through that venue. You can also try and get your stock listed on Global penny stocks website. Many people go there to get tips on which stocks to invest in.
     
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  10. puredemon

    puredemon Newbie

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    That one with the listing on the global penny stocks website is a great idea!
     
  11. Wilder1047

    Wilder1047 Newbie

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    Well - I typed out a long tirade on the whole thing. but BHW moderating system is hammering me for something that I can't figure out...

    Happy New Year!!
     
  12. Mises

    Mises Junior Member

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    A lot of those schemes try to make it look like they have some grand scheme and have solved the stock market game through some simple, yet somehow overlooked method. They make it sound like they know what they are talking about and some people unfortunately bite. Mailing lists are often used for this online and sometimes these organizations will put up other fronts such as trying to appear as if they are trying to do things for the betterment of the system (they might take political sides or condemn certain policies, etc.) only to then throw in their stupid picks in a pump and dump scheme. It is highly manipulative and in my opinion not ethical and if you go too far/don't cover your tracks you might just find the Feds at your door.
     
  13. Wilder1047

    Wilder1047 Newbie

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    Promoters take any platform they can to promote a stock.

    After all, it's just marketing a particular stock to people to create more buying power.

    Promoters are usually compensated by the company to promote the stock. So the company contacts the promoter and says - we are going to be releasing a PR campaign for this many days days - we need you to bring volume to it.

    As for what mediums they use.. I tried trading penny stocks last year - and opened up a facebook account strictly for that reason.

    I had SO many promoters on my facebook it was ridiculous - it was like a different beast - it wasn't even facebook anymore...

    I then decided to get out of that stuff - and deleted a large amount of them, but they still keep coming back - my facebook inbox is plagued with at least 50 messages per trading day. SPAM MUCH?!

    A lot of them have no real knowledge of internet marketing and strictly just spam. I've found very few that actually use video marketing and that sort of thing to build credibility to their brand.

    A few of the responses above are taking a very black and white approach to this. It's not all pump and dumping - some promoters are finding very genuine stocks waiting to break out and alert people to bring more volume to a good position. It's buyer beware - if you can't weed out the bull from the legit stuff out there - well, quite frankly you don't belong on the internet.

    Promoters that do receive compensation from the companies are marching a GREY line... The SEC IS monitoring this stuff... but there's no exact right or wrong to how you do it. Whatever they feel is wrong will end you up in jail.

    One easy no -no for them to abide by is no 'front-loading' in which they take a position in the stock before they start promoting - since that can be denoted as insider trading.

    There was a kid by the name of Jonathan Lebed I believe. A few years ago he would take positions in stocks, spam it all over the net for people to buy - and then sell out his position making the stock plummet. But these stocks were being moved on NO PR, NO technical analysis.. nothing. So, it was very obvious what he was doing and got nicked up after pulling a 250 thou pay day. With his past, you know this kid is being heavily monitored - yet he is back to running a stock promotion site. Walking the line...

    Ever heard of Jim Cramer? That loud mouth on TV. What do you think he's doing on the show week after week? He's promoting stocks - companies that have compensated him to do so....

    Sorry for rambling.. stocks have always fascinated me.. Especially pennies!!

    Think of this though - 90% of traders lose money.... Gee, I wonder what the other 10% are doing right?? I'm sure they're very talented at what they do...;)

    The part I love is - it's potentially illegal for the little guy to manipulate stocks. But, the big guys are doing it all the time. Look up the 'invisible hand' tell me that isn't stock manipulation.

    I don't know if that answered your question or not. This should sum it up...

    Stock promoters are not good at marketing for the most part- they spam.. and it works. Because it plays on peoples greed - looking for that big lotto ticket!!

    If you're interested in trading - goto youtube and search informed trades. He has a 75 part video series teaching you how to trade using chart patterns.

    I've since been using only the basic of his techniques for a paper portfolio.. I'd be up just over 100% in the past couple weeks - which is when I started.

    I've lost money in the stock market before, so I'm still hesitant to put my money in.. but man that 100% would have been nice over the holidays!!!:D

    Anywho.

    Happy New Year to all!!!
     
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  14. puredemon

    puredemon Newbie

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    That answered most of my questions! Thanks!
     
  15. nipester

    nipester Regular Member

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    OP you need to acquire and watch the 2000 movie Boiler Room starring Vin Diesel and you will figure out there is one more very effective method to promote penny stocks and that involves telemarketing and commissions even for non-brokers.
     
  16. puredemon

    puredemon Newbie

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    I already watched it several times... But this one involves more telemarketing then onlinemarketing

    But you're absolutely right it's a must see movie for everybody interested in stockstrading.
     
    Last edited: Jan 3, 2011
  17. Chronos

    Chronos Junior Member

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    derivatives.
     
  18. puredemon

    puredemon Newbie

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    What do these have to do with promoting a penny stock?
     
  19. schrute

    schrute Regular Member

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    Options plays are not as risky as penny stocks (almost though) and offer MUCH greater returns than penny stocks. To be honest, a company that is on the bulletin boards, pinksheets, or greysheets is likely a crap company. But people that follow those stocks are like those that play a lottery ticket or a casino.

    I am very familiar with penny stock promoting. You need to get a following going, people need to be interested in your content or wording. Usually they follow if you have good picks.

     
  20. woohah

    woohah Newbie

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    I work with promoters to help with the internet marketing of the businesses on the pink sheets.

    Most of their sites suck for seo.

    We push press releases, videos interviews, commercial type videos, social media.

    There are alot of evil people in the business that i have been introduced to, but we promote the technology of these small companies so they can raise more money to further grow their technology.

    Most promoters spam email still like in the 90's, but it does work to a certain degree.

    We promote for the long term hopefully and we don't get paid in stock upfront fees for a month or longer.

    Hopefully this helped.