A Byte of my 2.2-lb Brain

Just sharing stuff…

Penny Stocks

Such stocks can be highly volatile and subject to manipulation by stock promoters and pump and dump schemes. Such stocks present a high risk for investors, who are often lured by the hope of large and quick profits. – Wikipedia

$APM, $EG, $GREEN, $OPM, $AR — what do they have in common? They are penny stocks, which tsupiteros just love to manipulate (over other stocks). More often than not, they are very sporadically and thinly traded. That is exactly why once a movement is observed, like a sudden surge in buy/bid volume (especially that), most day traders get perturbed… and exhilarated, at the same time. Everybody wants to get himself positioned so as not to be left out. Why? Simply because it is one of the more obvious signs that a rally is about to transpire.

Below, I just quickly took snapshots of the charts of $APM, $EG, and $OV (different periods of rallies). Nope. I didn’t do any math nor statistical analyses. Sometimes, I just let the gut *think* & talk, if you know what I mean. Our brains are already wired to look for patterns anyway.

Most of the time the market will tell you what to do, all you have to do is know how to listen. – Anonymous

Speaking of penny stocks, I have been lucky with $EG (yes, I used the term luck). A bit of a history here. Another penny stock I’m interested in is $GREEN (for short-term trading). Aside from the surge in volume that we’ve been witnessing in the past trading days (ehem… see chart above… **clears throat**), I came across this news on its disclosure presented to the PSE:

Let me just highlight some parts I find appealing:

Under the agreement, Cleantech bought 20,776,856,000 primary shares of Greenergy for a total of P415,537,300.

Cleantech — a fund managed by ThomasLloyd Global Asset Management (Switzerland) AG of Zurich — was also issued two warrant certificates, covering 10,489,500,000 million shares each but with different prices of two and three centavos per share.

Lastly, to those who have been asking about $OPM and $OV: Yes, I’m also acquiring $OPM and I am “planning” to go “long” on this.

Still and all, I’m pretty sure that you will agree with me in saying that playing with penny stocks can be very dangerous, especially to newbies. It is also important to note that even seasoned traders are not spared from the jeopardy that penny stocks bring. I cannot overemphasize this enough: It is always beneficial to read more about your stock picks from certified official websites such as the PSE and/or those technical notes that your online broker provides you with. This is because, apparently, the manipulation can sometimes be very intricate to the point that “individuals or organizations buy millions of shares, then use newsletter websites, chat rooms, stock message boards, press releases, or e-mail blasts to drive up interest in the stock.” Imagine that.

Information is not knowledge. – Albert Einstein

Also, bear in mind that reward and risk — they always go hand in hand.

Risk comes from not knowing what you’re doing. – Warren Buffett

Likewise, don’t forget to always have your greed levels in check.

So, there! Anyway, like what my tagline says, I’m here for the thrill of it. Probably the same reason why I enjoy playing Baccarat with friends back home. 😉

I guess that’s it for tonight. I still have some work stuff to do — also for the thrill of it. xo

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This entry was posted on October 11, 2012 by in Stock Trading and tagged , , , .
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