Quote: (05-10-2015 08:05 AM)Zelcorpion Wrote:
Penny stocks trading is a waste of time. You will never be able to control the risk profile unless
1. you are either one of the big guys and doing high-frequency trading, scalping, have insider knowledge etc.
2. you are one of the hundreds of con-artists who are pushing some penny stocks to their clients, via forums. Since low volumes make those stocks rise, then those scammers are getting in on the action before pushing it as the next best thing since Wonderbread. Then the penny stock rises and the con-artist is gone before all the morons find themselves on the end of the volume wave. As they sell, it all plummets. Some of those penny stock pushers are small to medium companies while in other instances there were 16 year old intelligent students who did something like that promoting a penny stock online on forums - being able to generate enough momentum to con the public.
So no - there is no way to make money otherwise trading such a stock - the risk profile cannot be calculated and thus no decent trading is possible on it. That's why many pros trade instruments which are not so easily swayed by one company's event or something like a major buyback. For example - the higher risk premiums with stock trading make it necessary to have much higher capital requirements - 10-20x higher - than if you started to trade FX or indices. The inability to account for all-destructive Black Swan events makes it necessary to spread your investments far and wide to get decent money management. With penny stocks not even that can be accounted for.
This is simply not true. You can also make money by conning people into buying guides and self help manuals for the field. They are so smart, if they're losing, they must just be missing that one special trick. Not the one "doctors hate" but something similar.