penny stocks - (realy new question)

[Sam_grapestar]

So I'd like to start out in penny stocks for a smaller ammount of cash (even though it's volitile, yes) . I've never *really* traded before. What is a good ammount to "buy in" for? is there a minimum ammt? Is there a place here to discuss the smaller stocks? i'd like to show a vet penny trader my 'pick' and see if its a pile of dogg turd of if i've managed to learn something....

Thanks so much in advance,


-S

 

[Shanghai]

Well basically if you are buying penny stocks you can be sure that they are quite likely to be dog turd by the very nature of them being penny stocks. I'm not quite sure why you think penny stocks are the way to go rather than buying fewer, more high quality stocks? The costs to get in and get out of penny stocks can be huge as a percentage of the price which is one reason why few touch them, other than to have a speculative gamble.

 

[Sam_grapestar]

huhm. I guess it's always been a silly fantasy of some sort. I truly like how exciting it sounds, so i'd like to learn to play it. Like trying to win a tough game. Your comments dont fall on deaf ears though Shanghai.

Thanks

 

[Shanghai]

Probably best thing is to learn to trade. Then the techniques you learn can be adapted to work in many different markets.

Oh and buy the way, definately don't go into trading because of the excitment. That way your psychology will be all over the place and you will likely lose. The only reason to trade is to make money!

 

[TAjammy]

lol don't 'invest' in penny stocks

 

[Chorlton]

huhm. I guess it's always been a silly fantasy of some sort. I truly like how exciting it sounds, so i'd like to learn to play it. Like trying to win a tough game. Your comments dont fall on deaf ears though Shanghai.

Thanks

If you want excitment, take up Parachuting or Motor Racing....

If you want to actually make money then listen carefully to Shanghai's advice....

... And if you're still unsure, then just to repeat, don't waste your time with Penny Stocks. Trading them is akin to taking a trip down to your local casino and playing Roulette...

But then again, it all depends on whether you actually want to "trade" or just have a "gamble".......

 

[Sam_grapestar]

wow, heh. loud and clear.

 

[TAjammy]

Short Selling Penny Stocks - a lot of people think this guy is a scam, i disagree though, i don't think he is amazing or anything just good at funnymental analysis for penny stocks so that when they get pumped by promoters he shorts them.

I did his strategy on a simulator with a 20 minute execution time and made 113% in a month it was pretty easy though because usually when there is a a 'pump' there is a 'dump'

 

[Masquerade]

Well why don't you go lick his ****?

Going back to original question: 1 problem with penny stocks is the spread and another is a lot of these companies are purely speculative plays with companies that have very little/no earnings. So the best idea is to buy a bunch of a few of them and hope one of them will go up a few 100%. You've got to be prepared to be in for the long haul with these things and it really depends how much money you want to do. If I had £1k for penny stocks i'd be inclined to chop it into a few bits and buy shares in some companies rather than lumping the lot in one (unless you're very sure.)

 

[BoarDome]

Short Selling Penny Stocks - a lot of people think this guy is a scam, i disagree though, i don't think he is amazing or anything just good at funnymental analysis for penny stocks so that when they get pumped by promoters he shorts them.

I did his strategy on a simulator with a 20 minute execution time and made 113% in a month it was pretty easy though because usually when there is a a 'pump' there is a 'dump'

Until he did this with his hedge fund and eventually blew up, now making his money selling books.

 

[TAjammy]

well most of them are crap anyway so there isnt any other way to play them, unless you are a fundamental whiz who can find diamonds in the rough ... honestly its like 1 in 500

 

[Masquerade]

well most of them are crap anyway so there isnt any other way to play them, unless you are a fundamental whiz who can find diamonds in the rough ... honestly its like 1 in 500

That shows how much you know. Why bother commenting on what you don't know? You're not exactly providing any useful info to the OP either..

 

[TAjammy]

yes i am, suggesting not to bother trying to invest in penny stocks but take the short side when they are pumped....?

 

[Masquerade]

yes i am, suggesting not to bother trying to invest in penny stocks but take the short side when they are pumped....?

That sounds like an absolutely retarded idea tbh if you do it on that basis alone. Try shorting MXP when they were 3p - have fun with that. MAX PETROLEUM JavaChart MXP MXP.L - Interactive Investor

Besides....any idiot could see that in general it's going to be a more profitable strategy to buy 10 different companies at 1p/share rather than sell 10 companies at 1p/share. If you're short, most you make is 1p if the company falls to pieces. If you go long, you give yourself unlimited profit potential and if you're even slightly selective about your stocks it's a much better strategy to be long than short.

 

[TAjammy]

by pumped i mean pump and dump schemes by stock newsletter, stock promoters and boiler rooms, in fact it's blatantly obvious because if you look at the disclaimer of the newsletters it says they have been compensates with X shares and they will be liquidated

 

[Masquerade]

by pumped i mean pump and dump schemes by stock newsletter, stock promoters and boiler rooms, in fact it's blatantly obvious because if you look at the disclaimer of the newsletters it says they have been compensates with X shares and they will be liquidated

So what do you suggest? Sign up to every penny stock newsletter and keep in touch with your friendly local boiler room and sell everything they're trying to sell you?

 

[pennystocks]

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[anley]

Sam, you'll be financial cannon fodder for the brokers, ie they'll slice and dice your account in fees and duff investments till there's little left.

Plus, if it's excitement you want then the markets aren't for you as to get excitement you've got to gamble and you (or me) have as much chance of making money from penny stocks as the average bookie punter. Or to put it another way, it's the insiders who make the money at the expense of the clients. I'm not an insider which is why I don't touch penny stocks.

Good luck anyway.