Excuse the newbie question in this forum, but how does the following happen?
"Pennies are dangerous.......many gulible new investors are taken in by the MEGA PUMPERS here on IHUB."
Although financials need to be looked at a little bit differently with these kinds of companies, IMHO, there are still things that can be looked at.
1. History - if a traded company has been around for a while with a news history, it is more likely to be a decent trade and not a scam.
2. Volume - If there is decent, consistent (or increasing) volume on a consistent basis, it is more likely to be on the up and up. A stock with 20k of volume a day is flat out out of the question for me.
3. Quarterly/Annual reports - Look at em.
4. Verify what is on the boards - If there is a story being pumped on the boards, verify it.
5. Gamble what you can afford. This is not for paying the mortgage and this should not be your retirement. I feel confident enough with 'normal' securities to invest without feeling like I am at the craps table. I do not feel that way with penny stocks, so it is discretionary income.
6. If you are being a pig, there is a decent chance you will screw it up. I am being a pig right now with this stock, but I feel that I have cashed out enough to where even if this tanks, I will still end up with minimal losses.
Am I wrong in any of these assertions? In this, it seems like all of these criteria have been met or reviewed. Any of your opinions or insight would be helpful and once again, I apologize for putting this in this forum