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Penny Stocks
Old 09-02-2008, 09:47 AM   #1
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Penny Stocks

Hello,

My portfolio has turned very conservative over the last year. This is mostly due to me removing expenses from it for home improvements and turning what was left into funds/indexes, not any kind of fear of the recent markets. I understand patience and long term growth and am good about them more or less. What I would like to do is play around with $100 and see how far I can run it up. I use Scottrade, and the $7 trading fee makes it difficult to profit from higher priced stocks unless I want to use my margin ability which I'd rather not do. Is it possible to see how often and how many shares are trading at x price? For example, see that a stock currently at .008 also traded at .005 and .011? It's money I don't mind losing, I'd just like to have a little fun with it and see if it's possible to grow it. Any other suggestions would be appreciated. Thank you.

-Raymond
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Old 09-02-2008, 10:08 AM   #2
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The blackjack tables would be easier
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Old 09-02-2008, 10:10 AM   #3
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Casino games are a guaranteed loss over time. Lottery tickets are even worse.

-Raymond
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Old 09-02-2008, 11:03 AM   #4
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So is speculating over penny stocks.
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Old 09-02-2008, 11:13 AM   #5
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For example, see that a stock currently at .008 also traded at .005 and .011?
Before you start just make sure you understand what a market maker is and the bid/ask spread. Most penny stocks are traded in a "market" that is created by a market maker and when you see a low price that is a shareholder selling their stock to the MM and when you see a high price that is the MM selling their stock to a purchaser.

I bought a pink sheet stock (delisted preferred) a while back and I was really surprised how the bid/ask works since I was used to NYSE/NASDAQ transactions that typically have an inconsequential spread of a penny or so.

Between the spread and the commission you'll probably need to have a 30%+ "gain" in the MM's bid before you break even.
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Old 09-02-2008, 01:33 PM   #6
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I don't know of anyone, who wasn't involved in the scam, who didn't lose all their money in penny stocks. Think of it as the big wheel being manipulated, the craps game with weighted dice, or the poker game with the dealer dealing from the bottom of the deck. It's the newest version for the Mob of numbers running.
I've spent quite a bit of time investigating the garbage penny stocks and too many "guys" kept coming up as underlying owners.
You'd be MUCH better off sending me that $100 and thanking me for saving you future losses. Like gambling, it rarely ends with $100.
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Old 09-02-2008, 01:54 PM   #7
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Casino games are a guaranteed loss over time. Lottery tickets are even worse.

-Raymond
Exactly my point
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Old 09-02-2008, 08:00 PM   #8
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Hello,

It's money I don't mind losing, I'd just like to have a little fun with it and see if it's possible to grow it. Any other suggestions would be appreciated. Thank you.

-Raymond

I've dabbled in penney stocks . Now if you really want to have some fun with the money take it to the dog track on 50 cent fridays . Admission ,beer & hot dogs are all 50 cents and you'll lose the money slower than penney stocks and it's more entertaining .
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Old 09-02-2008, 10:17 PM   #9
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Originally Posted by popowich View Post
It's money I don't mind losing,
That's a good attitude to have, you will probably need it!

Quote:
see that a stock currently at .008 also traded at .005 and .011?
Bid/ask, as others have mentioned, will kill you. The only people that I've seen that stay involved with penny stocks for any amount of time appear to be masochists.

People complain about transparency in markets and companies, and these stocks have less of that than most other investments. Ripe for scams, and they get their share.

I forget the symbol, I think it was some financial company, but there was a penny stock a few years back that people bought shares in, and the shares being traded did not actually exist! The brokerage company said, ' not our problem', these people lost their whole investment, IIRC. Crazy.

You wanna do that? :confused:

-ERD50
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Old 09-03-2008, 08:38 AM   #10
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I can tell you horror stories about penny stocks that'll make you wanna hide in your closet. How strong is your stomach?
I once made $30k in a penny stock overnight. The problem was the brokerage decided it didn't feel comfortable paying me on it, so we settled on a deal where I only lost my initial investment. At one point they showed me $99MM in the hole.
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Old 09-03-2008, 10:25 AM   #11
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Google The Bowser Report and send for a free copy. They had a section in The Moneypaper I used for years for my DRIP stocks(the infamous two file cabinets of yore).

Caution - I never used that section nor bought any of the under $3 stocks. I checked my last issue, June 08 - like cigarettes, I'm trying to kick the DRIP habit. I won't even mention the Chinese solar water heater stock - I've enabled enough in this post.



heh heh heh - kayaks anyone?
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