Top 3 Pence Stock Investment Strategy
You may already know that a penny stock investment is very dangerous. In fact, this may be the most dangerous investment method. It is also very profitable. Stock shareholders did not have any competition, the stock price in a few weeks from 0.12 US dollars rose to 22 US dollars. But not every penny stock trading is the same. Although we can determine the most common three strategies, but the investor's technology is as much. You should definitely consider choosing one of them and then further improve to suit your trading style.
1. Major Stock Exchange Cheap Stocks
By the ordinary definition, the price of a penny stock is less than $ 5. On major stock exchanges, like the New York Stock Exchange (NYSE), NASDAQ or AMEX. Trading these penny stocks is just as safe as any stock trading on these exchanges. Stocks listed on major exchanges must undergo very rigorous reporting requirements, so you can be sure that these companies mean business. They are not some shell companies because of any suspicious reasons to start, but the establishment of the past and future business.
All of these seem likely to be safe enough, or at least no more risky than normal stock deals. However, you have to consider a major drawback and then decide to follow the way in which the major stock exchanges traded cheap stocks.
Companies that want to be listed on the New York Stock Exchange, Nasdaq, or American Online Exchange must pay astronomical listing fees. So, you find a penny in these deals may not be a small company, hoping to be ups and downs. It is likely that they were once big companies, and stock prices plummeted due to financial problems or other serious reasons. For example, Sprint (S) is listed on the New York Stock Exchange. In 2000, during the peak period of the network boom, Sprint's share price reached $ 75, only in 2012 reached a low of $ 2. As of October 2014, the transaction price is around $ 6.
When using this method, your main job is to find out why a penny stock is trading on such a low stock price. You have to believe that you choose the stock, though bad, it can still soar in the future.
2. Stock in the over-the-counter market and pink plate
At the counter (OTC) market and the pink form, you will not find a company that has been big but has fallen from grace. These dunks are usually small start-ups with less than $ 1. There are thousands of which you can not ignore filtering out of which 95% of useless research. OTC a penny there are other risks.
They are very mobile enough. There is not much stock trading every day, so if you buy stocks in the OTC market, then you may find yourself in a position where you can not sell your profit, because the gap between the bid and the bid price is very large. You will not be able to find buyers.
Another risk is that the vast majority of OTC market stock quality is really low, junk stocks, only a few stocks worth further study. Knowing how to find good is the key.
3. Take the pump and dump
There is no doubt that this is the most dangerous strategy. The penny stock deals get all the bad news, mainly because of the pump and dump plan.
Pumping and dumping is a very common and unethical (even criminal) activity, the liar has purchased most of the shares of the low quality OTC penny stock and then vigorously promoted so that ridiculous investors Buy the stock, thus pushing up the stock price. When the stock price shocks, the fraudster is only to sell the stock, leading to the immediate collapse of the stock price, so that investors worthless penny, can not be restored.
Then the question is whether you can take advantage of this fraud. There are two ways the first way may be unethical, but the second way will make you a penny stock trading king.
The first method is as soon as possible to determine a pumping program and the stock is still rising at the same time into the. What's more, you have to quit before the stock breaks. In other words, you are doing what these scammers are doing, with less information. This is of course a very dangerous strategy and may be an immoral strategy because – if you are successful – you are obviously taking money from the victim of the scam.