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Penny Stocks - Page 2© Kirk Lindstrom
Page 2
Sep 15, 2000
He finds while doing his DD that one of his tech stocks he just bought a load of is spending more money on plane fares seeking capital from Europe, than it is developing its product, so he dumps it all immediately even though it just dropped 25%. And he figures he's ahead of the ballgame. The stock has a 5 for one reverse split and he celebrates the fact that he sold his remaining little stake at a 75% loss instead of the 95% loss that would happen just a week later.
He gets bored with his penny stocks and ignores them for a few weeks. Then he looks at his statement one day and finds a 70¢ stock of his that had lost half its value over a period of 3 years now is over $4 a share and his hand is shaking as he calls his broker to sell. The same stock is $12 a share a few months later but then $1 a share a couple of years later.
He buys a 2¢ stock because he knows that the shell alone of any penny stock is worth 2¢ a share for companies trying to avoid the hassle of starting a corporation from scratch. His 2¢ stock goes into a 100 to 1 reverse split.
Surprisingly, his portfolio rises slowly over time and penny stocks are still better that no stocks at all.
In Conclusion Buying penny stocks is closer to gambling than investing. Buying them can be fun if you go into it with the expectation that you will probably lose all your money just as you might do on a trip to Las Vegas. Discuss this topic We have a discussion thread to discuss Penny StocksHERE in our discussion area. You can ask questions there and others will help you find answers.
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