I have been risking their capital Stocks as a hobby for a long time. However, it wasn't until I'd been trading penny Stocks that i made enough profit as i could easily quit initially my income job and trade Stocks for a living. I know what you're think... how does he check it out, right? Read on and I can tell you.
Recently I have shopping guide several online articles through various sites that make the claim that trading penny Stocks is just like gambling. As an active and incredibly successful Stock trader, these sorts of statements irritate me and therefore are not true for many persons traders who trade perhaps the otcbb and pinksheets. In fact, far from it, I don't really enjoy any type of gambling because I enjoy making money excess of losing it. I don't even like going into online casinos, although playing poker are fun as there is at least some strategy to that.
Now this is not to say that there aren't some traders out there that do indeed trade penny Stocks with the same random pattern as pulling the lever the actual slot machine or swinging the dice while drunk in Las vegas. However, these are usually newbies on the web Stock Market and they burn up very fast. Those investors that are serious about make money with penny Stocks soon learn techniques that allow them to do so and they soon learn they can earn more money with Stocks that trade for only $5 per share than they can trading traditional Stocks that trade at a minimum of $5 per share and expect to have larger market cap can certainly total net worth. I personally look for this that are going to breaking out and individuals make a nice profit I usually sell and lock inside my profit. I am not a daytrader but In addition , i don't believe in currently being so greedy I miss out on locking in my salary when I have the chance to do so.
I also want to be totally honest around you. Penny Stocks are notorious for being involved in scams during which time unscrupulous people manipulate the cost by promoting certain penny Stocks with a less than truthful if not ethical way. You've probably heard by way of "pump and dump" scams and is also imperative that whatever method used to trade these Stocks that you are able to avoid these type scams.
There are many amongst us that make an excellent profit routinely trading penny Stocks. We have learned methods to minimize risk to avoid scams. We have also learned locating the top 1% of these Stocks and after this when to trade the criminals to maximize profit.
There are successful traders like Peter Leeds who actually analyze penny Stocks using methods similar to the "fundamental analysis" used to bring Stocks that trade at higher prices and have much wider market caps. For me personally though, I have found that this kind of analysis does not work well for a number of penny Stocks. However, it really works for some of them along with times when it really works, this method would definitely not be considered gambling by anyone that understands the Stock Market.
I will explain though that the "Leeds method" and similar approaches to finding good penny Stocks is certainly not my first method of preference for two reasons. First, it simply doesn't target many categories of penny Stocks that think show a great deal of promise. This includes ones which i have traded and made a cool profit from! Second, it takes an enormous amount of time using these types methods merely analyze a few Stocks and that's once you experience the very steep learning curve can easily take months, in fact years to truly master.
What I generally keep performing is purchase premium Stock picks from professionals who specialize in penny Stocks and really know how to research them using an assortment of methods. This would of course are the ones "fundamental analysis" techniques if you can , but the best services also know how to play "detective" and ferret out important facts that you need to evaluate these lessor known companies before all others learns about it. I learned early on to test my sources of picks before I does one traded them. Then, once I have found a trusted source who is going to sends me consistently big picks, I trade only the best of them. I also only trade in the picks that obtain the best sense to me. Sometimes I perform some research but I have tested my sources of picks so well as i know which ones send winners frequently so my extra principals are just me being inclusion cautious. To me, this is a very logical and very profitable method of trading penny Stocks. It is not gambling in the slightly!
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