AI
Monday, August 04, 2008 10:08:06 PM
I suggest paper trading first before putting any money in the market.
First thing you need if your going to trade penny stocks are L2s. You cannot trade penny stocks without L2s. You need to learn who the market makers are:
http://investorshub.advfn.com/boards/board.aspx?board_id=10298 Which ones are retailers and which ones are known for dilution.
Next you need to find out what the share structure is. Go to pinksheets.com and if they file you should be able to find it there. Also ck out the monthly volume report to see how many shares the mm's dumped the prior months. https://www.otcbb.com/asp/tradeact_mv.asp?Issue=Fccn&searchby=issue&sortby=volume&Month=12-1-2006&downloadname=mv200612.exe&view.x=19&view.y=4
Learn charting to see if anyone frontloaded the stock before they began pumping it. http://stockcharts.com/charts/gallery.html?six
Find out who is pumping it and whether or not they were given free shares to promote the stock. Don't pay attention to the story behind a penny stock, most of the time it is all BS. IMO!
Most importantly trust no one, but yourself when trading penny stocks especially.
Defining the OTC Market
The OTC, or "Over-the-Counter", market is not an organized marketplace or exchange. OTC is a catchall phrase for any market in an equity security that is not listed on a US exchange or on the NASDAQ Stock Market. OTC securities are issued by companies that either choose not to list, or are unable to meet the standards for listing on NASDAQ or a US stock exchange.
OTC equity securities can be quoted on the Pink Quote system, and/or, if the securities are registered with the SEC and their issuers are current in their reporting obligation, on the OTCBB. Some OTC securities are not quoted on either the Pink Quote system or the OTCBB; these securities are sometimes referred to as grey market or "Other-OTC" securities. Because Other-OTC securities are not quoted on any quotation service, bid and ask quotations for these securities are not available. However, FINRA rules require its members to report transactions in all OTC equity securities to NASDAQ, so last sale and volume information is available for all OTC securities, including those categorized as "Other OTC." Pink OTC Markets provides a centralized quotation service that collects and publishes market maker quotes for OTC securities in real time. Pink OTC Markets is neither a Securities and Exchange Commission (SEC) Registered Stock Exchange nor a Broker-Dealer.
Quotation of OTC securities on the Pink Quote system is subject to Rule 15c2-11. The issuer of the securities may not apply to list or quote securities on Pink Quote. It is a market maker that determines whether to quote an OTC security and initiates quotation by submitting a Form 211 to FINRA. It is possible for a market maker to quote securities in the Pink Quote system without the knowledge or permission of the issuer of the securities.
Stock markets (including NASDAQ and the registered exchanges, such as NYSE or AMEX) have specific quantitative and qualitative listing and maintenance standards, which are stringently monitored and enforced. Companies listed on a stock market have reporting obligations to the market, and an on-going regulatory relationship exists between the market and its listed companies. OTC quotation services (Pink Quote and OTCBB) facilitate quotation of unlisted securities. As such, any regulatory relationship between an OTC quotation service and the issuers may be relatively limited or non-existent. Many OTC issuers are not subject to SEC registration requirements and therefore do not make regular filings of financial information and other corporate events with the SEC. Because Pink Sheets is not an issuer listing service and has no "listing requirements," OTC issuers are not required to provide financial information to Pink OTC Markets, though some do so on a voluntary basis.
Investing in OTC Securities
The OTC market presents investment opportunities for intelligent, informed investors, but also has a high degree of risk. Many OTC issuers are small companies with limited operating histories or are economically distressed. Investments in legitimate OTC companies can often lead to the complete loss of the investment. Investors should avoid the OTC market unless they can afford a complete loss of their investment. Investors should never purchase any security without first evaluating the fundamentals of the company and carefully reviewing the financial statements, management background and other data. Investors who purchase securities based on a "hot tip" or the advice of chat room touts will often be disappointed. Unsophisticated or passive investors should completely avoid the OTC markets.
Many OTC securities are relatively illiquid, or "thinly traded," which can enhance volatility in the share price and make it difficult to sell an equity position at a later date. Investors should always be wary of any sign of fraud or manipulation. Don't believe everything that you hear or read. And if it sounds too good to be true, it probably isn't true. To learn more, visit our Investor Protection Information page.
http://pinksheets.com/pink/otcguide/investors_index.jsp
In regards to your response to me earlier, I did not start out with 25k. I actually took a big loss at first for I played penny stocks. Since I started trading only big board stocks I not only made back my losses, but grew my account over the 25k and now get the platform for free. Plus I am exempt from the free ride rule now.
I understand you have to start somewhere, but remember there is no such thing as a life changer in penny world. Don't get greedy. Small profits daily add up to big profits in the end. Don't watch losses. Remember you can always buy back into a stock if it starts to run again, but don't sit watching red hoping it will. You can wind up diluted and Reverse Split down to nothing.
Date em, Don't marry em.
GLTY and Happy Trading.
First thing you need if your going to trade penny stocks are L2s. You cannot trade penny stocks without L2s. You need to learn who the market makers are:
http://investorshub.advfn.com/boards/board.aspx?board_id=10298 Which ones are retailers and which ones are known for dilution.
Next you need to find out what the share structure is. Go to pinksheets.com and if they file you should be able to find it there. Also ck out the monthly volume report to see how many shares the mm's dumped the prior months. https://www.otcbb.com/asp/tradeact_mv.asp?Issue=Fccn&searchby=issue&sortby=volume&Month=12-1-2006&downloadname=mv200612.exe&view.x=19&view.y=4
Learn charting to see if anyone frontloaded the stock before they began pumping it. http://stockcharts.com/charts/gallery.html?six
Find out who is pumping it and whether or not they were given free shares to promote the stock. Don't pay attention to the story behind a penny stock, most of the time it is all BS. IMO!
Most importantly trust no one, but yourself when trading penny stocks especially.
Defining the OTC Market
The OTC, or "Over-the-Counter", market is not an organized marketplace or exchange. OTC is a catchall phrase for any market in an equity security that is not listed on a US exchange or on the NASDAQ Stock Market. OTC securities are issued by companies that either choose not to list, or are unable to meet the standards for listing on NASDAQ or a US stock exchange.
OTC equity securities can be quoted on the Pink Quote system, and/or, if the securities are registered with the SEC and their issuers are current in their reporting obligation, on the OTCBB. Some OTC securities are not quoted on either the Pink Quote system or the OTCBB; these securities are sometimes referred to as grey market or "Other-OTC" securities. Because Other-OTC securities are not quoted on any quotation service, bid and ask quotations for these securities are not available. However, FINRA rules require its members to report transactions in all OTC equity securities to NASDAQ, so last sale and volume information is available for all OTC securities, including those categorized as "Other OTC." Pink OTC Markets provides a centralized quotation service that collects and publishes market maker quotes for OTC securities in real time. Pink OTC Markets is neither a Securities and Exchange Commission (SEC) Registered Stock Exchange nor a Broker-Dealer.
Quotation of OTC securities on the Pink Quote system is subject to Rule 15c2-11. The issuer of the securities may not apply to list or quote securities on Pink Quote. It is a market maker that determines whether to quote an OTC security and initiates quotation by submitting a Form 211 to FINRA. It is possible for a market maker to quote securities in the Pink Quote system without the knowledge or permission of the issuer of the securities.
Stock markets (including NASDAQ and the registered exchanges, such as NYSE or AMEX) have specific quantitative and qualitative listing and maintenance standards, which are stringently monitored and enforced. Companies listed on a stock market have reporting obligations to the market, and an on-going regulatory relationship exists between the market and its listed companies. OTC quotation services (Pink Quote and OTCBB) facilitate quotation of unlisted securities. As such, any regulatory relationship between an OTC quotation service and the issuers may be relatively limited or non-existent. Many OTC issuers are not subject to SEC registration requirements and therefore do not make regular filings of financial information and other corporate events with the SEC. Because Pink Sheets is not an issuer listing service and has no "listing requirements," OTC issuers are not required to provide financial information to Pink OTC Markets, though some do so on a voluntary basis.
Investing in OTC Securities
The OTC market presents investment opportunities for intelligent, informed investors, but also has a high degree of risk. Many OTC issuers are small companies with limited operating histories or are economically distressed. Investments in legitimate OTC companies can often lead to the complete loss of the investment. Investors should avoid the OTC market unless they can afford a complete loss of their investment. Investors should never purchase any security without first evaluating the fundamentals of the company and carefully reviewing the financial statements, management background and other data. Investors who purchase securities based on a "hot tip" or the advice of chat room touts will often be disappointed. Unsophisticated or passive investors should completely avoid the OTC markets.
Many OTC securities are relatively illiquid, or "thinly traded," which can enhance volatility in the share price and make it difficult to sell an equity position at a later date. Investors should always be wary of any sign of fraud or manipulation. Don't believe everything that you hear or read. And if it sounds too good to be true, it probably isn't true. To learn more, visit our Investor Protection Information page.
http://pinksheets.com/pink/otcguide/investors_index.jsp
In regards to your response to me earlier, I did not start out with 25k. I actually took a big loss at first for I played penny stocks. Since I started trading only big board stocks I not only made back my losses, but grew my account over the 25k and now get the platform for free. Plus I am exempt from the free ride rule now.
I understand you have to start somewhere, but remember there is no such thing as a life changer in penny world. Don't get greedy. Small profits daily add up to big profits in the end. Don't watch losses. Remember you can always buy back into a stock if it starts to run again, but don't sit watching red hoping it will. You can wind up diluted and Reverse Split down to nothing.
Date em, Don't marry em.
GLTY and Happy Trading.
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