It'll be a bigger fad than the hula hoop.
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.
Penny stocks? what’s not to love? You invest a few pennies and you could make millions! I know all about it.
Are you playing Weed stocks?
Don’t.
If you are asking questions about trading penny stocks on a politics internet discussion board then you have no business trading penny stocks.
Spend less than you make.
For retirement make use of 401k/IRA accounts as much as possible.
Diversify between stocks and bonds.
Diversify between domestic and foreign for stocks.
Use index funds.
Stay the course.
I should point out that, when people say stay away from penny stocks, they are telling you to keep the money you can’t afford to lose out, not the money you can afford to play with and you should have some money that you can have fun with and not worry about whether you lose it or not. It’s all part of the fun of investing to be able to hit that one stock where you made ten or twenty times what you invested in it and when you have lost everything you put into it.
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I completely agree. If the OP is looking for a fun little hobby then he can jump in with money set aside specifically for fun/entertainment and trade away. It beats hitting an innocent little ball with a stick in a big hay field, er... course, that is, trying to make it go into a hole. But that’s just me.
I’ve dabbled for a short time, mainly under the guidance of my brother, who actually studies this stuff.
His advice to me was to find a formerly profitable company that had recently weathered a storm or some unforeseen force that had driven the value down but which the company had managed to survive. For example, some smaller-yet-profitable companies can undergo government investigation for any number of things, and their values drop, even absent of a finding. If no violation, or even only a minor violation is found, those types of stocks may rebound.
Companies looking to diversify because of markets drying up can be good bets, too. That’s a sign that there are people within the company who are trying to adapt to changing conditions and are determined to make things work.
You’ll have to do a lot of research before you buy.
He hasn’t made a lot of money, but has gained more than he lost. You’re not going to be flipping stuff on a daily or weekly basis with this. Plan on keeping long-term, and plan on losing your money. Every time you put in more money, look at it as the last time you will ever see it. Don’t invest if you aren’t comfortable with that.
Personally, I would start with an amount of money you’re comfortable losing and use ONLY that. I’d warn you, though, that if you have a propensity to be addicted to gambling, this isn’t something for you.
I personally have an aversion to gambling, but I enjoy the thrill of watching the daily rise and fall. I usually put no more than $10 to $20 in any given stock at a time. Of course, if you’re investing $20 at a time, and buying at less than a penny a share, and it DOES take off, you could stand to make a decent amount of money.
I look at it the same as those who buy a Powerball ticket every week, except instead of my money going to the government, it’s going to someone who might be creating a job for someone else.
Here is a free Timothy Sykes play.
I dont know anything about the stock.
I do know that I view Sykes sort of like I do Goldman Sachs. For example, when they are downgrading Gold you know they are short and looking to go long...
I wont comment more than that about Sykes.
Do you own DD about this stock
My Number 1 rule. I do not INVEST in penny stocks.
I trade them.
If you are a novice I say to you STAY AWAY. At best, I would suggest you open a TDAmeritrade account and practice in a “paper money” account (which is not real).
The big problem with penny stocks, even if you understand the companies, is the lack of liquidity, resulting in sometimes a huge % difference between the bid and the ask. This means that every time you get in and out you are losing a lot of $.
I am currently really scared of the regular stock market after the big run-up in the last few years. As such I am very attracted to the Junior Mining sector (especially small miners, and not exploration companies that don’t produce any gold). These stocks have lost an average of 80% last year, and many of them are now penny stocks. Some of them have really quality properties with a lot of gold and silver resources. The gold price is now below some miners’ cost of production (and therefore less likely to lose much more and stay down there), so I try to pick companies whose cost of production is way lower than even the current gold price, and run by good management. I myself am in GGAZF, MMTMF, AUNFF, ISVLF. Again, don’t invest in them until you understand them inside and out.
I think this beaten down sector provides a potential as some of these companies are trading literally pennies on the dollar of what they should be trading, as if gold were already at $800! Caveat: many analysts including Goldman Sachs are forecasting $1050 gold during 2014.
If I were you and I like the junior sector, I would start by trading ETF’s such as the GDX, GDXJ, or the triple levered NUGT. They are much easier to get in and out and when (not if - everything has a cycle, and the world didn’t suddenly end on the mining sector!) the Junior mining sector is on an upswing, these ETF’s should give you fantastic return on your money. Just understand that before it starts recovering, it might take another hit.
Good luck investing!
Very good advice. I have forty years experience in investing in stocks -- including low priced issues -- bonds, options, and commodities. I have often dissuaded friends from "investing" in penny stocks. Invest in an broad index funds if you don't fully understand investing. Gamble in Vegas, if you must, but not in penny stocks.
Nobody should consider investing in a penny stock recommended by a broker before watching that movie. That's goes double for a broker who calls you unsolicited.
If you are a newbie then noone will recommend penny stocks. They are not for beginners. I trade them occasionally but I am very careful. They are never a core holding because of the speculative nature of these risky crap shoots. I would suggest buying and reading some books on stock trading basics. Follow some stocks on a Yahoo financial account you set up. Track their performance and see how you would do if you actually bought and sold those stocks. You may be better off buying ETFs and let them do the trading for you. It’s easy to lose money and hard to hang onto profits.
Thank you all. You’re the best.
Here’s how I started (and forget the penny stock idea, it’s for losers and you’re NOT a loser):
http://www.directinvesting.com/
and read, read, read. Their phone number is also at the top of the website and if you get stuck, call them.
Basically, you start by buying one share in a GOOD company and have your dividends reinvested. Then you go from there. It’s not sexy; it’s inexpensive and low key. You let time do its work, sort of like compound interest.
As experience goes. The Nevada registered penny stocks were the worst ones to own. You can learn much from watching them go do in flames with or without a dead cat bounce. Roth IRA accounts have better advantages if you just wish to trade. Schwab offers an immediate Regular IRA to Roth conversion. TDAmeritrade uses a paper form conversion. Perils are many—beware.
Take your money and throw it in a shredder. You should end up with the same result as playing penny stocks.
If you find a penny stock that someone is recommending, it probably means that they own some of it that they are trying to get rid of.
Good satire thread, thanks!
One point I’d like to make. If you’re new to investing, you will not make much money in the beginning. However, as time goes on and you gain experience and skill, you are learning something that you can pass onto your children and help gain a comfortable footing to build upon. It’s no different than any other occupation or trade.
Bump
Go see the movie “Wolf of Wall Street” (or just google it). You’ll know all you need to know about penny stocks, which in a nutshell is: “Just Say No”. The only people who make money on penny stocks are the con-artists who sell them.
I thought they were doing away with pennies.
It'll be a bigger fad than the hula hoop.
~~ “I don’t [have] money for the study kits our courses or Miami Beach seminars.”
Sounds like someone must have come across promotional material for a high-priced course or seminar about a system that promises to make a killing in the market using penny stocks.
Resist any temptation and don’t be curious.
It takes a lot more than buying a course or a system to be a successful trader. And these systems are usually way overpriced, of dubious value, and marketed by people who don’t trade.
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There are two broad categories of trading approaches: fundamental and technical analyses. Most small or retail traders use technical analysis (= chart reading) exclusively because fundamental analysis takes a lot of resources and does not yield precise trading signals.
You can find tons of free information on the Internet about technical analysis and all the popular indicators traders use (moving averages, MACD, RSI, Bollinger Bands, etc.) These indicators work more or less the same across different markets; and it is best to study lots of charts and develop your own strategies or edge, so to speak. There are even inexpensive ways to test your ideas or technical analysis skills with real money. As a beginner, you want to trade a market that is liquid and costs very little to get started. Penny stocks are thinly-traded and that alone is a good reason to avoid them.
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