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Who knows about trading penny stocks? A plea for help.
1/12/14 | Righttackle44

Posted on 01/12/2014 2:03:05 PM PST by righttackle44

Folks, I am a poor boy who would like to be helped and educated by someone who knows what they're doing--what they're talking about.

I have been reading some, but there are a lot of basic things I don't yet understand. How much money would I need to start the whole shebang? Can you use online stock sites to purchase shares, or do you have to go through a broker? You get the picture. My friend said that me thinking about penny stock trading is like trusting Lou Costello or Jerry Lewis to assemble an H-bomb.

I'm looking for advice, but I'm also looking for advice about books, trustworthy websites, trustworthy teachers--like Jerry Lewis would need if he were to receive a pile of H-bomb components on his front steps--keeping in mind that I am a poor boy. I don't money for the study kits our courses or Miami Beach seminars. I know most of you understand this.

In advance, I would like to thank you for your help and assistance. You guys are the only ones I would think about asking for help about this.


TOPICS: Education; Miscellaneous
KEYWORDS: broke; markets; newbie; pennystocks; poor; stocks; trading
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1 posted on 01/12/2014 2:03:05 PM PST by righttackle44
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To: righttackle44
Buy low and sell high. 😊 Happy I could help.
2 posted on 01/12/2014 2:06:22 PM PST by Jonty30 (What Islam and secularism have in common is that they are both death cults)
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To: righttackle44
In my experience - which was almost 30 years ago - "penny stocks" are called that because that's basically what they're worth.

On rare occasion, you might find a gem of a startup, but I wouldn't bet more than a hundred bucks on my chances.

3 posted on 01/12/2014 2:07:32 PM PST by ErnBatavia (The 0baMao Experiment: Abject Failure)
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To: righttackle44

A penny saved is a penny earned?

A penny for your thoughts?

” Government is the people’s business and every man, woman and child becomes a shareholder with the first penny of tax paid.”

Ronald Reagan quotes


4 posted on 01/12/2014 2:07:41 PM PST by Redcitizen (Never bring a tank to a Chuck Norris fight.)
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To: righttackle44

Trading penny stocks is like penny slots in vegas you have to put lots of pennies in play to make any money out of it


5 posted on 01/12/2014 2:08:01 PM PST by al baby (Hi MomÂ… I was refereeing to Obama)
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To: righttackle44
There's two ways to go - gamble, or know about the companies you are investing in. Gambling, you can simply follow the penny stock forums and hopefully buy in before the crowd does, and sell before the crowd does.

My boss has done a great job investing in WMIH, the holding company that has the ‘assets’ left over from the WaMU takeover, essentially a massive tax write off for other companies to take advantage of, as they have billions in tax credits that could offset profits. Purchased a large amount for pennies a share, and it is now at $2.70 a share.

But he made the investment knowing what ‘assets’ the company had, and had been atop the company since the day he invested to ensure that those assets didn't all go wandering off into the sunset in someone’s pocket.

Gamble or use knowledge - Honestly, I think the second choice is the only good course to guarantee profitable return on investment.

6 posted on 01/12/2014 2:11:04 PM PST by kingu (Everything starts with slashing the size and scope of the federal government.)
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To: righttackle44

Sure people can make money from penny stocks- Sirius was 12 cents 5 years ago and trades for about 3.60 now.

But the problems with most of these issues is their lack of liquidity and a market, as well as their generally shaky financial standing.

Its extremely risky, and you should be as prepared to lose any money you invest on it as you would be on money invested in a “hard eight” at your local craps game.

A big return is certainly possible, but its more likely you’ll lose.


7 posted on 01/12/2014 2:13:06 PM PST by I_Like_Spam
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To: righttackle44
My friend said that me thinking about penny stock trading is like trusting Lou Costello or Jerry Lewis to assemble an H-bomb.

Your friend is correct. They are extremely risky, and usually only serve to burn up investor's money. If you really, really wanted to gamble, (and yes, you are), you can look at the marijuana stocks. These are all the rage right now since Colorado and Washington legalized pot, and may go up as other states legalize.

8 posted on 01/12/2014 2:13:35 PM PST by Vince Ferrer
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To: al baby

It would be good training for those who have never taken the plunge of investing before.

I do know several people who invest and it takes about ten years before you start to get good at it, so I wouldn’t do much more in the beginning than put your money in safe stocks, ones that are not likely going to go bankrupt soon.

However to learn, you have to play the game and that means putting real money where you will likely lose it all. However, that money is the price you pay to learn the rules. Almost everybody here has lost a fair bit of money learning how to invest.


9 posted on 01/12/2014 2:16:18 PM PST by Jonty30 (What Islam and secularism have in common is that they are both death cults)
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To: al baby

Penny stocks don’t normally survive; they are on a fire sale for good reason.

Recommend picking ten penny stocks and track them for a year, keeping track of how much money you would have lost.


10 posted on 01/12/2014 2:16:58 PM PST by caltaxed
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To: righttackle44

I’ve traded pennies, options, commodities, and stocks for over 40 years.

Stick with established stocks.

The others are all losers.


11 posted on 01/12/2014 2:19:09 PM PST by G Larry
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To: al baby

So true. For every penny stock that goes up over a dollar or more, 10 to 20 go down to nothing. Google pink sheets. Penny stocks do not meet criteria to be listed on an exchange and therefore don’t get institutional money (mutual funds) to trade them. Being thinly traded they’re like gambling.

Start at Motley Fool. Buy stocks of companies that makemoney.


12 posted on 01/12/2014 2:19:53 PM PST by Dansong
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To: righttackle44

STAY AWAY


13 posted on 01/12/2014 2:20:39 PM PST by CGASMIA68
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To: righttackle44

Is this a bit like using Kickstarter to fund your trip to the Yukon to prospect for gold? or would you sell stock, meaning you would share the profits should you strike gold?


14 posted on 01/12/2014 2:21:09 PM PST by GeronL (Extra Large Cheesy Over-Stuffed Hobbit)
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To: righttackle44

Don’t do it. Go to the Horse track or Jai Lai where you have a chance. At least you can drink and have a good time while losing your money. :-)


15 posted on 01/12/2014 2:22:55 PM PST by Georgia Girl 2 (The only purpose of a pistol is to fight your way back to the rifle you should never have dropped.)
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To: al baby

Beware of the Pump N Dump too


16 posted on 01/12/2014 2:23:22 PM PST by GeronL (Extra Large Cheesy Over-Stuffed Hobbit)
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To: righttackle44
The idea behind "penny stocks" is to catch lightning in a bottle, to find a low-priced stock (sometimes only pennies per share, but sometimes higher), and to catch hundreds or thousands of percentage points in gains if the underlying stock takes off.

That's the way it's supposed to work in theory. You still need a brokerage of some kind to buy these stocks, and you probably might get a discount in you buy in round lots, or higher quantities of shares. You can use an online broker for better discounts. These are pure growth stocks; you won't get dividends from these stocks. It may be more difficult to find a lot of information about your specific stock, other than standard SEC filings.

Because of their speculative nature, they are considered much higher risk. They might be ideal to fill out the last 5% of your overall portfolio, but I would not have a larger portion invested, and I would certainly not risk a sizeable portion of money I was counting on;e.g., retirement funds, college funds, etc.

Because there may or may not be buyers for all stocks, it might be more difficult to dump your shares if the market goes south. Good luck!

17 posted on 01/12/2014 2:24:49 PM PST by Lou L (Health "insurance" is NOT the same as health "care")
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To: righttackle44

Not a good idea. It’s very easy to get set up to do it, at $7 per trade, but odds are you will lose a lot of money.

Better to save up and get into a small business.

While you’re saving, take the first two college Accounting courses.

In order to invest, every person needs to understand the financial aspect of business.

You need to understand how transactions flow into a Profit & Loss Statement, and an accounting Close to produce a Balance Sheet.

Also, you begin researching what type of business you’d like to be in.

And look for suitable partners, advisors, mentors, etc.

You’ll start feeling more comfortable as you get more ready to operate a business.

You can work for someone else in their small business and receive some mentoring and experience that way.

Every year a business makes a net profit, it’s value (the value of your shares in the company) goes up.

That’s like owning a stock that never goes down in price.

Stocks traded on exchanges, however, go up AND DOWN based on the perceived value of the company by the market and general market conditions !

If you are not a sophisticated investor, the stock market is a very bad place to invest.

How many people in the past few years joked that their “401k was now a 201k” - meaning the value of their mutual funds, etc., had gotten close to HALF it’s value. Though they’ve bounced back to one extent or another, it is very difficult for the small investor to RECAPTURE LOSSES.

You could get professional advice, but you’ll find it very expensive with a tiny portfolio as a percentage of invested assets, and there still is no guarantee you won’t lose money.

Also, IMHO, not a particularly good time to be in publicly-traded stocks.

IMHO.


18 posted on 01/12/2014 2:25:25 PM PST by PieterCasparzen (We have to fix things ourselves)
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To: righttackle44

There’s a movie called Boiler Room. WATCH IT.


19 posted on 01/12/2014 2:25:27 PM PST by Tea Party Terrorist (Why work for a living when you can vote for a living?)
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To: righttackle44

I have fully investigated this matter and have compiled a thorough report that covers everything you would want to know about penny stocks. The report can be yours for the low, low price of $149. But wait, there’s more! If you order today, I’ll include the ground-breaking report THEY don’t want you to know about. It’s titled “A Fool And His Money”. Hurry, call now. Operators are standing by.


20 posted on 01/12/2014 2:26:27 PM PST by Veggie Todd (I don't always talk to Obama voters, but when I do I ask for Large Fries.)
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