When trading penny stocks you start to dig for info right away you'll find penny share forums once in the forum you'll notice heavily discussed penny stocks. Right away this should set off caution signals and you need to become cagey about the excitement.
This isn't to say the stock is no good but there are reasons its being debated and regularly these dialogues are the results of folks who are the owners of shares of the company bigging it up to raise the price per share so they can sell. Or, folks who've been paid to plug the stock doing a good job at promoting by keeping the symbol in the head of the forums and conspicuous to each trader that visits the forum.
This is what us penny investors call "hype". On occasions "hype" can essentially get the price rising and everybody in low will profit. This is a nice thing but doesn't make the company a quality investment. There are better paths to research and find corporations to make an investment in.
Stock promoters live upon new and young traders. They're looking to take advantage of the get rich fast mindset of the young stock trading crowd. They will pump their stock up whatever whats going on telling everyone that's the subsequent Microsoft and then when the stock does poorly they will blame the exposed shorters. Exposed shorters are traders who short penny stocks without owning any shares.
When they short one of those stocks, they are gambling the price will drop and with these volatile stocks they are customarily right. Because the population-at-large can't short these stocks they feel these exposed shorters are insiders manipulating their stock so they can buy at a less expensive price Its due to these shorts that their great cash generating stock isn't going up in cost. This is about as real as the boogeyman.
Buy stocks for the right reasons, not because they're the most discussed penny stocks and have more folks excited on some random message board than any other stock.
This isn't to say the stock is no good but there are reasons its being debated and regularly these dialogues are the results of folks who are the owners of shares of the company bigging it up to raise the price per share so they can sell. Or, folks who've been paid to plug the stock doing a good job at promoting by keeping the symbol in the head of the forums and conspicuous to each trader that visits the forum.
This is what us penny investors call "hype". On occasions "hype" can essentially get the price rising and everybody in low will profit. This is a nice thing but doesn't make the company a quality investment. There are better paths to research and find corporations to make an investment in.
Stock promoters live upon new and young traders. They're looking to take advantage of the get rich fast mindset of the young stock trading crowd. They will pump their stock up whatever whats going on telling everyone that's the subsequent Microsoft and then when the stock does poorly they will blame the exposed shorters. Exposed shorters are traders who short penny stocks without owning any shares.
When they short one of those stocks, they are gambling the price will drop and with these volatile stocks they are customarily right. Because the population-at-large can't short these stocks they feel these exposed shorters are insiders manipulating their stock so they can buy at a less expensive price Its due to these shorts that their great cash generating stock isn't going up in cost. This is about as real as the boogeyman.
Buy stocks for the right reasons, not because they're the most discussed penny stocks and have more folks excited on some random message board than any other stock.
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