It doesn't happen everyday and all the right peices have to fall into place but it does happen and below will get you started on understanding shell stocks. Shell stock are high risk/high reward type plays imo! I hope this helps.
What is a Shell Stock? A Shell Stock is a publicly traded company that has no operating business. Many of them trade for pennies and are thought to be worthless. But after completing a Reverse Merger, they can explode in price and increase in value by 10 times, 20 times, and possibly over 100 times their original share price! To understand why this is possible, see What is a Shell Stock and What is a SPAC.
What is a Reverse Merger? A Reverse Merger is a technique that allows a private company to become an instant public company. This alternative method for completing an IPO (Initial Public Offering) is the catalyst that makes the price of a Shell Stock explode! For more information, see What is a Reverse Merger.
Why consider Shell Stocks? The potential return of a Shell Stock can be enormous! Imagine buying a tiny $0.0312 Shell Stock that traded as high $50 six weeks later! A $1000 investment would have been worth $1,600,000 at its high! For more information, see The anatomy of a Shell Stock - SXML. Or how about a Shell Stock that went from $0.10 to $11.20 in two days, and later traded as high as $30. For more information, see Elvis Presley and American Idol merged into SPEA Shell Stock.
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