ok so i want to tell you a story frist of all. my buddy works at BOMBARDIER and one of his friends works part time there. he is a stock analysit who loves planes. anyway he has a lot of friends on baystreet (Canada's Wallstreet) and has regular meetings every wednesday with some of the leading portfolio managers on baystreet, (evaluation is based on consistant performance, not total assets managing, which there is a difference) anyway my buddy invested in a penny stock which now we call crapital gold (Capital Gold is the real name). after he lost money on the stock my buddy was talking to his buddy (the anaylist) about the trade that he made with crapital gold. he started laughing. the reason is he knows the guys who use that stock to pump and dump and effectively use it to take peoples money. they do it in a group so that it is market forces and not individual forces to mask the scam.

One thing is that you have to realize that if you want to play penny stocks is that, you have to look at it from this perspective before entering the trade, portfolio may be sitting with 5% in cash. well if they manage 50 million or 100 million of cash, that means that they have 2.5 - 5 million dollars to play with and if they are going to do something with that money it will probably be with a stock that they know that can control, lets take a stock that is 1.5 in price.

lets say they decided to take it to 2.25, they would buy a large lot in and around the 1.5 to 1.75 mark. now as they begin to push the price up they are making themselfs money. now you and i see that and think got to get in, the trend is up, this looks bullish, that looks bullish, man i think i may have found a winner. in all of this what you don't even realize is that the way they are trading it is designed to attract new money so that they can sell the based that they built prior to pushing the price up. so that in the end you are left with the bag so to speak.

anything under 5 dollars is a penny stock, and it has the ability to be manipulated in this manner. if penny stocks are what you want to invest in, thats your deal, however i want you to understand that you are taking a larger risk than you might actually think. playing a stock that is 20 for example is less risky because first there are more investors involved in that stock first, and second it is more likely to move (when looking at it from a dollar basis) to 21 and holding than a stock that is 2 going to 3 and holding.

i just thought i would post this.

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Hope This Helps And Don't Forget To Have A Fantastic Day.

My friend told me something similar about penny stocks. I rarely buy penny stocks because I feel it is too risky for me.

Most penny stocks I get are from news makers compensated a certain amount of shares.
They blow up encouraging news to increase the price and after a short period will decrease.
So if we have money we can afford to loose and want to ride the wave it might be considerable. We surely may win a lot of money too.

Sign up for some penny stock trading alerts...these can be really fun and it's free. Type in "penny stock alert" in Google and you will be inundated with choices. Just realize that these are ultra short term trades. Dont get attached to them cuz they will crash just as soon as they spike. I have made some good money off of these pump & dumps. Alot of people complain about them but those are usually the ones that play them wrong. These are not "investments"..these are trades. I am typically in and out the same day or have taken nearly all of my profits and scaled down my position. You can't get greedy. Take your profits when you make them. Dont be fooled into thinking the stock is going to run higher because of all the hype. I know people who may have had an intraday gain of 300% and never took profits b/c they thought it would go higher. They ended up breaking even or losing on the trade. 300% was not enough!!??

With penny stocks, I always look at volume. I like to see alot of volume coming in vs. normal volume. I especially like to see this when no news has come out yet. Sometimes you can get tricked by companies diluting their shares but thats the risk you take. Take a small position if something looks like it could be developing..then add to it if it starts to run. At any given time I have numerous trades on. I'm always putting out "feelers". I cut the ones I was wrong on and add to the ones that are running.

I think some penny stocks are worth investing in, you just need to be careful. Sometimes a good company gets slammed so much that their price declines and becomes a "penny stock"

Thanks for the insight. I expect that many under priced stocks are "manipulated" in this way. I think I'll stick to the 10 to 20 range.

Hi,
In my point of view, penny stocks trading are the most interesting trading of all as there is an opportunity to double money in a short period of time. It requires no physical labor and time. What it needs is all up-to-date information on stocks.

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Penny Stocks

from my limited experience with penny stocks, info is typically difficult to find & trust. they aren't required to follow the same rules as the nysa, etc. never had any success trading penny stocks

The term penny stock refers to any stock that is traded outside one of the major exchanges. The definition of a penny stock is a low priced speculative security. From www.hototc.com you can know more extra things about penny stocks.

In my opinion penny stock is simply to earn high money with low risk.

Thanks

penny stocks