Penny stock trading is not for everyone!

Only those with a tolerance for "high risk" should consider trading in penny stocks! Penny stocks are volatile by nature. These stocks can swing in either direction rather quickly. On the upside, one can quickly make a lot of money in penny stocks! Penny stock companies range from either being new to the public trading scene, to those who are "fallen giants". It must be remembered that it is the nature of a company to make money and to expand. In penny stock trading, one is hoping to latch on to one of these expanding/emerging companies at "rock bottom" prices. The more you "play" the penny stock game, the more you will realize that the stock market in general is very much affected by news, either good or bad. You will need to constantly monitor the news. Timing is a critical element when investing in penny stocks. You don't want to find yourself in a situation where you invested $2,000 one day, and 2 days later the stock fell 50% -- which does happen! As a general rule, look to buying these stocks at their 52-week low, or lower.

Can you get Rich in Penny Stocks?

Penny stocks periodically run from say $.005 to $.20
cents or more. Frequently these runs occur in the
February-May period, but not always.

In 1999, a tiny stock called PNET ran from $.10 cents
to $8 in four weeks. A $1,000 investment could have
increased in value to $80,000. A $5,000 investment
would have become worth $400,000. Another example
is STRU. In the summer of 1999, that stock was
trading for less than a penny. In a matter of days
it ran to .60. A $1,000 investment in STRU would
have enabled a savvy investor to pick up 100,000
shares. The $1,000 became worth $60,000.

In the fall of 1999, a tiny unknown penny stock with the
ticker symbol YNOT traded around $.20 cents. In six
weeks the stock price EXPLODED to $25. A $1,000
investment would have become worth $125,000. A $5,000
investment would have increased in value to $625,000.
A $10,000 investment in YNOT would have become worth
$1,250,000.

The penny stock world is filled with stories like this,
yet the mainstream media never talks about it.

1. Before buying - make sure that they are not likely to go bankrupt! 2:1 assets vs liabilities is very nice, but more important is liquid assets, cash on hand, etc.
2. Check out Tinystock Caution list. Learn what to
look for and reasons to avoid certain stocks there.: 3. Guage the "hype" via message boards, etc. Hype has an awful lot to do with penny stocks. Analyze the news on the stock! A "good" penny stock company knows how to feed tidbits of good news all the time. A bad one never puts out news. Some only put out bad news...; 4. Watch volume--make sure it is not a "selling off" before buying! Volume over 1 million is often a good flag! Buy into one with less and you may find it very hard to sell.; 5. Buy a penny stock lower than today's price if possible...Just have patience and leave an order good to cancel, or nothing, and WITH a LIMIT PRICE.. Never, ever place a MARKET order or you may pay 2-3 times more than you wanted to. Usually buy near the 52-week low!
: 6. Look at getting out after your penny stock doubles your money, or selling one half - which puts you in a very good position... We like to sell 1/4 off after it doubles.; 7. If your penny stock happens to go down--hold long term--even a year or more....In the meantime "hype" it (telling truth only) periodically via stock message boards, etc.

CARDINAL RULES FOR INVESTING: DO NOT move on any of these so-called "hot tips" you may read on these message boards, on USENET, or that are sent to you via stock newsletters - until you first check things out for yourself. Message board and USENET visitors have been known to plant false information - to try to help out their own positions (declining stocks). Along with this rule goes the second and equally important rule: if a stock broker cold calls you out of the blue with a "hot tip"....hang up the phone!!!