Anyone have success trading Penny Stocks?

[Bellini]

When it comes to Penny Stocks, there seems to be divided opinion about whether it's worth trying to trade in these stocks or not.

Just curious if there was anyone here that has done it and whether or not you had any success (profit)?

Or is it a waste of time?

 

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[Bila]

Bumping so somebody ( better informed than me about stocks ) will reply

 

[mikekob]

I'm interested to. I guess for a better understanding just watch Wolf of Wall Street. Which reminds me I need to watch it again.

 

[BlakeIC]

Nobody gets rich off the stock market

 

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[CommonCents]

I'm interested to. I guess for a better understanding just watch Wolf of Wall Street. Which reminds me I need to watch it again.

why watch that movie? to learn how to rip off retirement money from innocent investors ?? To do drugs? line up hookers? Hollyweird should quit glorifying crime since there are plenty of inspirational entertaining stories from many legitimate successful entrepreneurs.

 

[mikekob]

Yeah but regardless it's good entertainment. And on some level there's motivation about having a lifestyle like that to certain extents. Gotta have some motivators out there.

 

[Guest14692]

I am 100% convinced that you can be successful at trading penny stocks. Yes they're garbage. That makes them exploitable.

A guy by the name of superman has a killer track record. Check him out. The majority of people will fail in penny stocks, but it is an inefficient market and thats the good news. You can sign up for the biggest penny stock alert sites (the scammiest looking sites mind you) and trust that the performance of some of these pink sheets will be dependent on what these sites are reporting in their mailer as "breakout potential". It becomes a self fulfilling prophecy with these lower volume speculative investments. If you ever look at those spam emails you receive that are promoting penny stocks, there is usually a disclaimer that states that the company is paying for the marketing and advertising of their stock. You can anticipate pump and dumps and short them for big $$$. People are definitely doing it for a living.

 

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[Guest3722A]

I'd say I have an above average amount of trading experience seeing that I started back in the late 90s and have taken my share of lumps but I have also doubled my money on several occasions as well, after putting my time in by obsessively watching technicals on real-time streaming charts, hours at a time, day in and day out. (how's that for a run-on sentence)

Penny stocks I have watched on and off here and there and I think I even traded one or two waaay back in the day, and most likely took losses. So, my suggestion with pennies based on what I've seen and learned throughout the years would be to always take the short side -if- you can even find shares to short. And, enter these short positions after parabolic moves or even strong moves that go outside of the upper bollinger band (20 ma should be good) and open your short the day you see it drop below this bollinger band.

Use an intraday chart (hourly) against the daily to get a feel for weakness and try to get that short opened right before the close when it seems like it's going to drop below that band. If you have no idea what I am saying, Ya might wanna put some study in If you do know what I'm saying, I would definitely also split your money up into 10ths or even 20ths and trade only one part (1/10 or 1/20). This way if you lose your arse, you can always come back to play again.

There's so many things that can go wrong here but the short side is definitely safer, and I gave you a high probability set-up for em.

edit: I'm sure you're aware there's nothing fastlane about any of this as it's more of a game than anything else

 

[NVaz]

Most (if not all) penny stock alerts are from pump and dump guys (many different services/sites are managed by the same guys) . One of the main problems with penny stocks are the lack of volume (iliquidity), which means, there will be no one available to buy when you want to sell them (whithout incurring on a major loss in value)

 

[Bellini]

Thanks for the answers, guys.

You pretty much confirmed what I already thought. I am always a little wary of pink sheet / OTC stocks.

I don't respond to any promotional emails on stocks of any kind, and I do read the fine print.

It does seem like the pump & dump schemes are fairly prevalent, along with the risk of having no one buy when you want to sell.

Thanks for the tips!

 

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[Guest3722A]

Bellini, if you're just trying to find some belief somewhere that will overshadow some fears of the unknown about the absolute fact that you too can make money passively, please consider listening to Vigilante's mind your business podcast where he gives a detailed explanation about how to get started in importing.

It's one of the early episodes, I think within the first 5. I can give an honest testimony here that IT WORKS because I threw I think a couple hundred at it and then a few months later I was up around $2000-$3000 a month - passively.

The odds of succeeding with this and bringing that belief are far greater than trading.

 

[Bellini]

Bellini, if you're just trying to find some belief somewhere that will overshadow some fears of the unknown about the absolute fact that you too can make money passively, please consider listening to Vigilante's mind your business podcast where he gives a detailed explanation about how to get started in importing.

It's one of the early episodes, I think within the first 5. I can give an honest testimony here that IT WORKS because I threw I think a couple hundred at it and then a few months later I was up around $2000-$3000 a month - passively.

The odds of succeeding with this and bringing that belief are far greater than trading.

Thanks @topherea - I will try to find the episode you're talking about.

 

[Guest3722A]

And just something to think about, ok?

"What are you Waiting For?"

"I remember hearing this on the radio last year while I was driving to my miserable job"...

I know the leap holds fear of the unknown, but you will see that it really isn't too painful at all. And fun actually. Once belief is there, it will serve as a building block

 

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[Bellini]

And just something to think about, ok?

"What are you Waiting For?"

"I remember hearing this on the radio last year while I was driving to my miserable job"...

I know the leap holds fear of the unknown, but you will see that it really isn't too painful at all. And fun actually. Once belief is there, it will serve as a building block

I'm working on it! haha

I actually quit my job right after that. Well, after finishing MJ's book too. lol

Even though I was instantly happy and felt like a 100 lb weight had been taken off my back, I went into survival mode.

Then a few months ago I got the idea for a business and started my progress thread.

But now I'm trying to find a...dare-I-say-the-word... job... in a new location so I can stabilize myself some while trying to work on a business.

I'm not afraid to make leaps by any means, but it sucks when you're trying to swing on a vine from one tree to another, and you're kind of suspended in the middle. ha

 

[Guest3722A]

I definitely understand that analogy more than you know. And my apologies for yapping first without even reading your progress thread! Sorry

I was there and still digging my way out too btw. So I get it. The underlying point I was trying to make (but bombed) was that importing or even retail arbitrage can serve as a way to get those much needed dollars flowing to your bank account which can serve as just enough of a foundation to support your vision.

This can free up time.

Dare I say it, but facebook has several Amazon based groups that have hundreds of members who discuss ways they make serious bill paying cashola through importing and private labeling and retail arbitrage.

Many members from this forum hang out in these groups and some are absolutely killing it to the tune of up to $50k'ish a month. Some of these groups members like to show their numbers every month. Very motivational.

The mind your business episode I referenced has solid actionable advice that can be done with only a few hours a week. It can be adapted to also suit individual circumstances.

I fought against this whole Amazon/Ebay/shopify thing for a very long time, but when I finally gave in and went for it, I too realized how fun it is to wake up in the morning and see that I made money while sleeping. Good money. And now I have a system in place that does most of the task work for me which had freed me up now to continue with further building of that foundation.

Anyway, I'm sorry. I know a lot of this can be very confusing and it is sensitive, just wanted to shine a light on something that's effective. And kinda fun.

 

[Bellini]

I definitely understand that analogy more than you know. And my apologies for yapping first without even reading your progress thread! Sorry

No worries @topherea !

I didn't take it badly at all. I really appreciate your interest and input.

I too realized how fun it is to wake up in the morning and see that I made money while sleeping. Good money.

I would love to experience that. I don't know what that feels like....yet.


I will PM you.

 

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[bringitnow28329]

I have been a full time professional trader since 2002 at the bottom of the dot com bubble. I trade all stocks of any price from .50 to 1000 but I focus on stocks in the 1-25 range. Penny stocks are no longer just the classification given to low priced stocks. A penny stock today is just a very volatile stock. For the average person volatility is bad but for traders it's extremely important since it's required to help a stock move towards a traders target price. Stocks that are illiquid will always cause you to lose money because you won't be able to get out when you need to. That is the problem with almost all OTCBB and Pink sheet penny stocks. They have almost no volume and people are so clueless that they see dollar signs and throw money at these worthless stocks..

Now if you want to make money in penny stocks forget true low price penny stocks. The ones that trade for pennies or fraction of a penny are pure scams and it's absolutely no different from a casino but the odds of success are much lower than in a casino. The stuff that went on in the wolf of wall sheet is REAL it's just that it's no longer brokers calling people on the phone but instead it's all online today.

The key to making money is that you need to learn to time the market and have a very short time horizon of a few minutes to a couple days at most. The longer you hold penny stocks the greater the risk increases that they go out of business or just get dumped but the promoters. It takes time to learn to trade because trading is not just about coming up with a trading system of when to buy and sell but you also need to learn to control your emotions (fear and greed). For most people this is very hard and it's the reason they fail in trading.

The most important part of trading is protecting your money. A couple myths are that you can start with a few hundred and turn it into millions. This is almost impossible unless you get incredibly lucky. You need to start with a reasonable amount such as at a minimum a few thousands and even that's low as well. The reason is if you don't your profits will not amount to anything due to commissions and slippage and you will be spinning your wheels.

In trading you don't make money every time. You have to except risk and take small losses in order to find the winning trades that pay you ten times over. My winning percentage is 68% and the rest of the time I take losses but I have big money by just controlling my loses. Anyone that says they win 80, 90 or 100% of the time in trading is straight up lying to you. It's impossible except for a select few high frequency trading firms.

Trading alert services are useless. You cannot follow someone else and consistently make money. Seriously don't even try. You can get lucky from time to time but it's impossible since the so called guru's have too many subscribers and literally move the price of stocks when they send alerts. You never get the same price as them yet they always seem to make money but you will just lose.

Do not believe the news you read. News, stock tips, opinions, etc, is terrible to follow. You need to learn to make your own decisions. It's the only way to have long term success. Trying to buy a stock because it's been in the newspaper or on yahoo finance is the best way to lose all your money. Eeryone has an agenda and the people putting out financial news are or analyst research reports are not out to help you. they are out to help their clients dump stock on unsuspecting people like you. Buy means sell and sell means buy most of the time.

I could go on all night because I live and breath the stock market but it's bed time for me. If you are interested in learning more feel to drop me a pm but please understand you have to be serious to learn to be successful as a trader. If you are lazy you have NO shot to make money and you will most definitely lose your shirt because the stock market is a zero sum gain and for every person that makes money their is a person that is losing their money to pay the winner.

 

[Jesse Dallenbach]

Bellini, if you're just trying to find some belief somewhere that will overshadow some fears of the unknown about the absolute fact that you too can make money passively, please consider listening to Vigilante's mind your business podcast where he gives a detailed explanation about how to get started in importing.

It's one of the early episodes, I think within the first 5. I can give an honest testimony here that IT WORKS because I threw I think a couple hundred at it and then a few months later I was up around $2000-$3000 a month - passively.

The odds of succeeding with this and bringing that belief are far greater than trading.

Hello topherea,

where can one fine Vigilante's mind your business podcast?

Thanks in advance!

- Jesse

 

[NVaz]

Hello topherea,

where can one fine Vigilante's mind your business podcast?

Thanks in advance!

- Jesse

Here you have ... but you can use the search in the forum or google it next time, it would do you much better to learn how to fish instead of waiting for someone to give you the fish

Mind Your Business Podcast
Facebook and Twitter

 

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[Jesse Dallenbach]

Here you have ... but you can use the search in the forum or google it next time, it would do you much better to learn how to fish instead of waiting for someone to give you the fish

Mind Your Business Podcast
Facebook and Twitter

yeah guy I googled it right after i asked I know how to fish very well thanks!

- Jesse

 

[wrighj03]

Penny stocks are only good, if the company is undervalued. Meaning they have more physical assets on their balance sheet then their valuation. Also, If you have a big chunk of change you could buy 50% of the shares, vote yourself onto the board of directors, fire the CEO and sell off all the assets. That is what they do on Wall st.

 

[bringitnow28329]

Penny stocks are only good, if the company is undervalued. Meaning they have more physical assets on their balance sheet then their valuation. Also, If you have a big chunk of change you could buy 50% of the shares, vote yourself onto the board of directors, fire the CEO and sell off all the assets. That is what they do on Wall st.

This is so far from the truth I just laughed out loud. Penny stock do not earn profits and most have no revenues or assets. You can't value a penny stock like you can a real company. The majority of these companies are boiler room stocks. They are no real companies. They are registered business entities, aka shell corporations but they make unsuspecting and uninformed people like yourself think they are real by posting bogus press releases and have a nice flashy website. This is the truth...

 

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[wrighj03]

That's baloney. You still have to contend with the SEC. Jones soda trades for .38¢. And, i've bought them at a gas station.
I would definitely read some Warren buffet, Billy Graham, Milken and Liars poker books.
It's all about the fundamentals. Because, they are not trading on an exchange doesn't mean worthless.

If you are more risk adverse, collect premium.

Sent from my XT1080 using Tapatalk

 

[bringitnow28329]

That's baloney. You still have to contend with the SEC. Jones soda trades for .38¢. And, i've bought them at a gas station.
I would definitely read some Warren buffet, Billy Graham, Milken and Liars poker books.
It's all about the fundamentals. Because, they are not trading on an exchange doesn't mean worthless.

If you are more risk adverse, collect premium.

Sent from my XT1080 using Tapatalk

There is a difference between the stocks of once real companies which now trade for pennies and true penny stocks that never earned anything and have never traded for more then pennies. A stock like JDSA now trades for a measly $.40 a share because it no longer earns profits and it's business has essentially gone down the toilette. The market values it as junk because it is junk. If you want to buy value and invest, rather than trade (yes there is a huge difference) then you should find a company which earns profits and generates lots of revenue, not a penny stock.

Buying stocks like JSDA and actually investing in them for the long term, is equivalent to buying lotto tickets because the fundamentals are terrible. Warren buffet and the other people you mentioned aren't valuing $.40 stocks. The stocks I was referring are usually lower priced and have never traded on a legitimate exchange like JSDA. It's absolutely not baloney. The truth is penny stock companies get their products into main stream places like a CVS or a grocery store in order to make people believe that their company is legitimate and they have a shot. This almost never works out. Show me stocks which have traded for $.20 and went to $50 and stayed there for good. There are almost none out of 10000+ penny stocks. Penny stocks rise and fall even faster not because of fundamentals but because of spam emails and other forms of stock promotion such as key word spam in main stream news and pr websites.

As for the SEC, up until November 2013 they really did nothing about the fraud that was so prolific in the penny stock market. The OTCBB and Pinksheet markets have lost a lot of their volume because the SEC set up a task force to bust fraudulent penny stocks and the big promoters closed up shop or got busted by the SEC but they are still present in these markets.

With all this said I trade these stocks for a living day and and day out but I do so in the very short term. That's the only way to do it without taking huge risks and just plain gambling. Most people will lose their shirts in these sort of stocks.

 

[M&A]

If you have an edge that exists in the penny stock market you should exploit it and make $ like Tim Sykes did.

But if you think your going to look at a chart, click a few buttons and make big $ money consistently trading thats beyond insane.

I can't recall one big whale trader who trades penny stocks for obvious reasons, there a lot of better markets out there than penny stocks.

 

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[bringitnow28329]

I trade anything with volatility, not just penny stocks. I am a far superior trader to Tim Sykes. I know him personally. He is not a good trader, he even admits it. His edge is not his trading system because he really doesn't have one, but instead the fact that he has 5000 subscribers which pay for his alerts. He front runs his subscribers trading penny stocks which in general are more illiquid than legitimate stocks. He gets in before them and the stocks move very fast and their buy or short sell orders push a stock towards his target. He gets out with a profit nearly every time, and then sends an alert and thousands of lemming followers who run for the exits pushing the stock back to his entry or even past it. The majority of people lose because they try to follow him. He knows what he is doing is essentially illegal but because he is discloses it he can get away with it and a new sucker is born each minute which is why he is able to keep getting new people o buy his useless dvd's and pay 5500 for his ridiculous challenge program scam.

Yes I have an edge and it is real, not this guru follow me, front running bs. It can take years to learn to trade if you don't have anyone to show you, and very few legitimate people will. Many people will not be successful because as I mentioned it's not just about knowing when to buy and sell, but how to control your mind so you stick to a plan of when to buy and sell and how much to risk each time so you don't lose all your money on one trade.

 

[Vigilante]

I have only purchased one penny stock in my lifetime, so my experience is not likely the norm.

The one that I bought...

I bought a pretty large block.

Ended up being a pump and dump. A few days after I bought it, the company announced a 50-gazillion to one reverse split.

The stock tanked, went through the reverse split, tanked, and I ended up with less than a hamburger's worth of value in my stock certificates.

First and last time. Unless you know what you are doing (which I clearly did not) this is not a game for the uninformed, non-INSIDERS.

 

[bringitnow28329]

You bought an OTCBB or Pinksheet stock. Almost all of those are worthless. The whole point of that market is to fleece unsuspecting people like you of their money they dump in thinking they are going to strike it rich (no offense). The only edge you have in those type of stocks is on days when you find some really volatile ones which are trading millions of dollars in volume, (not just shares), but the price per share times the number of shares traded needs to be like $2 million plus. What this does is ensure you are not going to be trying to by up half the trading volume or anything like this. On top of this when there is significant trading volume it's much easier to get in and out undetected from the rest of the idiots, suckers and fools who are sitting there waiting to lose their money to market makers, hedge funds that deal in secondary offerings and large traders.

With that said the penny stock market does not have the capacity for whales. You can't take $10 million and dump it into a penny stock. You can trade a few hundred thousand and earn $10k or $20k on this size position but as I said the opportunities are much less now that the SEC cracked down on the promoters that run the pump and dumps which create the volatility that is required to profit in these stocks. The new opportunities are in the stocks in the 2-20 range that list on the nasdaq cm (small cap market), amex or nyse.

I have only purchased one penny stock in my lifetime, so my experience is not likely the norm.

The one that I bought...

I bought a pretty large block.

Ended up being a pump and dump. A few days after I bought it, the company announced a 50-gazillion to one reverse split.

The stock tanked, went through the reverse split, tanked, and I ended up with less than a hamburger's worth of value in my stock certificates.

First and last time. Unless you know what you are doing (which I clearly did not) this is not a game for the uninformed, non-INSIDERS.

 

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[Bellini]

His edge is not his trading system because he really doesn't have one, but instead the fact that he has 5000 subscribers which pay for his alerts.

Like what MJ talks about in his book regarding the 'gurus' who don't actually make their money doing what they are talking about, but from sales on their promotional materials designed for the suckers

He front runs his subscribers trading penny stocks which in general are more illiquid than legitimate stocks. He gets in before them and the stocks move very fast and their buy or short sell orders push a stock towards his target. He gets out with a profit nearly every time, and then sends an alert and thousands of lemming followers who run for the exits pushing the stock back to his entry or even past it. The majority of people lose because they try to follow him. He knows what he is doing is essentially illegal but because he is discloses it he can get away with it and a new sucker is born each minute which is why he is able to keep getting new people o buy his useless dvd's and pay 5500 for his ridiculous challenge program scam.

Sounds like nothing but manipulation

Many people will not be successful because as I mentioned it's not just about knowing when to buy and sell, but how to control your mind so you stick to a plan of when to buy and sell and how much to risk each time so you don't lose all your money on one trade.

Yes, I have read this is one of the most important things to remember about trading and investing... to have a plan and stick with it so you don't trade out of emotion.

------
The reason this came up is because I kept seeing this particular OTC company that has been floundering in their attempts to start up for the last few years, but lately they seem like they might be getting stabilized and they are in a good field. (this was a stock that I never got an email about or ever heard of it being promoted by anyone. I actually found it on my own)

Their price is dirt cheap but the shaky startup they've had concerns me.

Also, I can tell that the positive press that has been released about them lately had been largely put out by them, (like you mentioned, 'bogus press') but if even half of it is true, they may actually go somewhere.

Anyway, it sounds like I need to stay away from OTC altogether.

Thanks for your comments and input. (everyone)

 

[koolst]

Like what MJ talks about in his book regarding the 'gurus' who don't actually make their money doing what they are talking about, but from sales on their promotional materials designed for the suckers



Sounds like nothing but manipulation



Yes, I have read this is one of the most important things to remember about trading and investing... to have a plan and stick with it so you don't trade out of emotion.

------
The reason this came up is because I kept seeing this particular OTC company that has been floundering in their attempts to start up for the last few years, but lately they seem like they might be getting stabilized and they are in a good field. (this was a stock that I never got an email about or ever heard of it being promoted by anyone. I actually found it on my own)

Their price is dirt cheap but the shaky startup they've had concerns me.

Also, I can tell that the positive press that has been released about them lately had been largely put out by them, (like you mentioned, 'bogus press') but if even half of it is true, they may actually go somewhere.

Anyway, it sounds like I need to stay away from OTC altogether.

Thanks for your comments and input. (everyone)

Hi guys i'm a newbie penny stock investor. can you advise me where do i start?