I could not resist----this was/is too well written by VFC ,, so I cut, pasted, edited and inserted BIEL in the appropriate spots--
The BIEL stock is a speculative investment and will be considered one until the company can demonstrate the ability to survive without having to rely on a third party for financing.
It's important to keep in mind that with speculative stocks comes a large amount of speculation- that is why they call it a 'speculative' investment.
a speculative investment = actual news and numbers + speculation on the part of investors + hype.
When trying to predict the future, which is what you do when you speculate, you need to take all of those factors into consideration when deciding whether to buy or sell your stock. One thing, however, that cannot be over looked is that when you are trading in speculative stocks, you cannot ignore speculation.
For that reason, if you've got no stomach for risk and volatility then you should stay away from speculative stocks. You, as an investor, have to look at the facts, look at the possibile events that could effect the stock price and make a decision as to what you ascertain fair value to be FOR YOU. Once you've done that, find your high limit price and buy on any dips below that price and then try to average down.
Also, long term investors should not be concerned with the day to day price fluctuations of the stock. A big player who wants in could move the stock 20% to the upside in an hour, but when he's done buying it will retreat again. You've got to learn to accept that volatility if you want to dabble in speculative plays.
There are many out there right now that want in on the ground floor of a growing company and since BIEL is considered to be on the ground floor, investors are buying in now with little concern of whether or not the stock is trading for FOUR cents or SIX cents. That causes the stock to look overvalued, but these investors are speculating that the stock price will be much, much higher in two years from now, not concerned with the fact that it might be five cents lower tomorrow.
Again, it's up to each individual investor, based on their own DD, to decide what is their fair value for a stock.
In my opinion, a new investor looking to buy now or add to their position of BIEL,, should buy in with half the amount that they wanted to invest in BIEL with. Then try to average down. This way they would not be fully invested if the stock dropped (and would be able to add cheaper shares with the other half) but they also wouldn't miss the boat if significant news sent the stock upwards. That's how I do it when a stock is trading for a little bit higher than what I see as fair value.
Speculation will lead to large percentage price swings and overvaluation and will also draw in swing/day/momentum traders that will add even more to the volatility. Those factors do not always show up in technical charts. So what you get is a bunch of long term, small shareholders (the little guy) buying on the dips while the swing/momentum/day traders (big boys) play their games.
I emphasize that this stock is speculative. That means every new or existing long term investor should speculate about where they think this company will be in two to five years from now.
Many believe that BIEL is going to grow significantly during that time frame and this is why people are still trying to get into this stock when it is trading for a price that others consider to be overvalued.
Let's be honest, if you want to crunch numbers and look at the earnings reports of speculative stocks and value those stocks technically, stocks like BIEL, CSUH and TTNP would be trading for zero.
Remember, when investing in speculative stocks you're going to have to speculate.
I plagerized this from VFC---hope he doesn't mind--
art35
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