Penny stock investing... any winners care to share tips

[coolTechno]

penny stock investing seems like a good investment with high returns..... according to InvestingPennyStock.com value of penny stock can increase by several hundred percent overnight

i do agree that there is nothing called a bad profit.. but with these high return investments high risk is attached as well

any winners in penny stock investing care to share tips

[shuebakka]

I definitely don't consider myself an adept trader when it comes to penny stocks, but I have had some nice winners in short periods of time. However, I attribute that to pure luck. Some members here may contest to this, but it is my opinion that, in general, the cheaper the stock the less predictable the price is. Sure, you can see a several hundred percent increase in price in a matter of days, but it can also fall just as fast.

The biggest mistake people make with trading pennies is betting too much on any one stock. That 1,000% gain in profit may look extremely appetizing so they bet the farm, only to find out it was a dud and lose it all. Bet a fraction of what you would on a normal priced stock and those red days will be much more bearable.

If it's the lower price and high returns that sound appealing to you, you may also want to look into trading options. Seeing several hundred percent gains in a matter of days is not at all uncommon. You get the benefit of leveraging higher-priced stocks where (I feel) it's a bit easier to spot cherries.

[BadThad]

If you have limited money to invest, stick with the small and mid-cap stocks. Trying to hit the "big score" with Pink Sheets or OTCBB stocks is VERY rare....just MHO. I've lost my share of money to non-reporting companies. If I can't read honest fundamentals, I'm not interested anymore.

[CaptD]

Here's my suggestions:

1. PLAY ON PAPER BEFORE YOU "PLAY' WITH YOUR HARD EARNED MONEY! Penny stocks are a crap shoot, so don't invest in them unless you are OK with losing all your money! I think of penny stocks as being the same as going to Las Vegas... Don't gamble with any money that you can't lose and also chalk the experience up to "having fun"...

2. Spread your "bets" around so if you lose half your plays hopefully the other half will make up for the losers!

3. Be prepared to hold some of them for a long time if you don't like to sell at a loss. Remember those folks that used to talk about using old shares as wall paper...

4. If you are lucky enough to be holding a stock that is going up fast; immediately put in a sell at a higher price for at least half of your position for two reasons. One, if it "fills" on the way up you will get your price during the price rise instead of chasing the falling ask price (trying to sell) during the dropping price which usually results in a big loss or percentage of your gain! Stocks go down MUCH FASTER than they go up! Two, If you get your initial investment back you can then afford to "play" with the additional stock!

5. Before you invest, calculate the TC (true cost)! Use the pps (Price Per Share) calculation of doing a trade to determine how high the stock has to rise before you EVEN make a profit, then ask yourself if the risk is worth the gamble.

TC = [(pps x # of shares) + (BOTH buy & sell comm.)] divided by (# of shares)

(i.e.. Say you are thinking about buying 10,000 shares of a PENNY stock that looks good to you. Figure that it is going up because of good news and you want to buy it at $0.005 (and you pay BOTH $10 to buy and $10 to sell as your commissions). Lets do the math, to see what the stock has to do before you make any money. [$0.005 x 10,000 + $10 + $10] divided by 10,000 which equals ($50 + $10 + $10) divided by 10,000 or $70 divided by 10,000 or $0.007 as your pps! So the stock has to increase to at least $0.007 BEFORE YOU BREAK EVEN!

Now lets say you want to make about 10% profit on your "bet", what price does the stock have to go up to, to do that? $70 x 1.1 = $77, so let's round it up to $80.00 and divide that by your 10,000 shares which equals $0.008. So just to make about 10% on your stock "bet" the price will have to go from $0.005 to $0.008... Are you now thinking twice about making that trade or "bet"? GOOD.

Now consider if you bought more shares (say 100,000), how would that change your buy or NOT buy decision? Using the above math, now the pps is $0.0052 instead of $0.007 which is much better! Now let's add the 10% profit and then it becomes [(100,000 x $0.005)+$20] x 1.1 = $572 divided by 100,000 shares or $0.0057! Therefore a price move from $0.005 to $0.006 would give you your 10% profit! Also if it went to $0.008 (like discussed in above smaller purchase) then you have about 54% profit!

($0.008 x 100,000) = $800 - $520 (initial investment) = $280 GAIN
$280 divided by $520 (initial investment) = 0.538 or 53.8%

Remember also that you are "gambling" 10 times as much money and if the stock goes down then your losses will be greater!!!

Good Trading!

Remember: If you don't plan ahead, you'll end up depending upon someone that does...

[TNTrader]

1) There is no such thing as an investment grade penny stock. They are pennies for a reason. Most have no real product, no revenue stream, no business model and no shot.

2) Penny stocks are 90% lifestyle generators for a few insiders. The one in 10 that actually has a plan looks just like the others unless you can get seriously deep into reliable books.

3) All penny stocks are debt generators. You must be able to see a defined path to profitability through the forest of debt they grow. If you cant, dont play.

4) If you have any qualms at all about losing everything you bet on a penny, dont play. You are going to lose far more often than you will win.

5) Unless you have the level of technical skill and experience of the cats and a few others here, keep your money in your pocket and watch them for a long time. 90% of pennies are based on falsehood and deception. The talent to beat the system at its own game is hard earned. Learn something from the ones that have survived the educational process.




Good Luck

[BlueCat]

Great advice by all!

Thx,

j.

[cobra1049]

Hi Everybody,
I understand with high risk on Penny Stocks but like news come with promise, then grab some quick bucks as you ask for share tips.
I have looked everyday with MircoFeed News. I will not pick so so news. Only I see like 1 for 3, merger, drop in from big store, natural changes like virus, hurricane, etc. I will grab and use for short time as my rule is 10% up, take out. Ignore greed more than 10%.

[CaptD]

Sage Advice!