It's not like I advise to stay away from penny stocks... I am just saying that there are plenty of pennies among big board companies now, and I would rather stick with them. One example of my recent position: bought RAME in @ 1.2-1.5 range, sold March-09 2.5 calls for 0.5-0.6. So, I now own position with ~ 0.8 basis of a transparent stock, where insiders are buying, should report ~0.2/sh revenue soon, etc. In "normal times" it's easy $5+ stock by all valuations. So, if we are back to normal market by March, my shares will be called at 3 times of the cost. If we are not - I can sell another set of calls, or take a profit, or... Again, RAME is not a perfect example. Their debt is pretty high, although they claim to have enough cash for 2008 drilling. I don't recommend doing this to anybody. Anything is risky at this market, even "safe" muni bonds (which I trade through CEFs). Basically all my open positions are hedged by ITM calls or shorts against the box. For example, I am holding PVX/PVXCA and HTE/HTEEB - 30+% dividend payers (that could be called anytime).
IMO.
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