Never buy a OTC stock if/when…
1. The price is below all moving averages (BAMA)
2. Less than a year old, no 200 day moving average
3. With recent promotional mailer, spam E-Mails, fluffy, excessive or daily PR's, cold phone calls
4. Price is at an old time low
5. Checkered Past by Company Executives
6. Broker Restriction on Buying and Selling
7. No Record of Revenues or Profit for Companies that Have Traded for More Than 6 Months
8. Huge or heavy dilution
9. Unable to Contact the Company at all
10. The company makes many promises but never delivers.
11. Pink or grey sheet
12. Recent death news like "FDA fails to approve drug..."
13. With very weak volume, or strange volume pattern
14. No physical place of business
15. A company that changes its business entirely, like from mining to medical ( not reverse merger)
16. Less than 5 employees
17. Be aware of the first 6 and 9 month mark when employees are allowed to sell their stock
18. Recent history of reverse splits
19. Can not find the actual number of shares and float
20. PR's that blame MM's and short selling
21. Total lack of communication from company.
22. No follow-through on promises by management
23. The authorize share count is raised
24. Long period of time with no volume
25. Large spread in the bid and ask
26. Large or long negative trend
27. History of trading being halted
28. Company incorporated in Nevada
29. Failure to file on time
30. Be careful with biotech stocks. Bad news is quick and brutal.
AI
