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What namely a penny stock? That depends aboard who namely asked. For this fable it means any stock trading by an USD per share or less They tin commerce aboard the pink-sheets, the 'over the counter publication board'(OTCBB),alternatively any other exchange. This namely a colossal list of penny shares catered according Yahoo.
These are the reasons why cent stocks longing lose maximum investors money.
The Penny Stock Myth
Myth: Penny Stocks are Cheap
Imagine someone worked apt the bank and wanted to cash among a 100 USD detain Would there be a financial difference whether the teller gave 100 times one USD bills, five times 20 dollar bills,Christian Louboutin Discount,or ten thousand pennies? The net amount namely alike.
The price per share of a stock and the market capitalization are two vary things Market capitalization namely the price per share multiplied according the absolute shares. This represents the utter value of new shares. Using the above instance presume the mall capitalization is 100 greenbacks The company has the option of issuing 100 shares by an USD every five shares by 20 dollars each,or ten thousand shares by an penny each.
Why would a company prefer apt sell their stock along pennies while they could give it a finer dignity according issuing fewer shares at a higher value Because they know is by pricing the shares inexpensive they give them the fantasy of creature cheap absence apt bring within marketing hunting investors. The company may well understand that institutions wouldnt touch them by any cost.
Other Dangers of Micro-priced Companies
Penny stocks may also be traded on pink-sheets alternatively over the counter publication boards. It is worthwhile apt memo is never always stocks aboard these exchanges need be cent stocks. If a stock is traded according these two means be discreet The standards of these exchanges can be very cheap Often,one ambition ascertain stocks namely were booted from a more trustworthy exchange.
Read on Where to Find Canadian Penny Stock Picks Finding Penny Stocks apt Buy Penny Stocks Watch List
If a cent stock is likewise a micro-cap stock,where can i buy christian louboutin shoes, meaning namely the mall capitalization namely less than 300 million greenbacks relying on citing source), this tin be especially dangerous. With such a low merit aboard the total shares,one investor may have liquidity problems. When purchasing illiquid stock, prices may skyrocket and then pew once the purchase is ended When selling illiquid stock, the cost may leak dramatically since few buyers exist.
Another caveat of illiquid stock is the pump and dump deed Such companies are susceptible apt spam form hype which aspiration have mercenary traders flocking apt buy,thus driving the price up. During this same duration of time the deceitful individual sells his shares. Anyone who purchased longing be very irate once the shares dump backward to their pre-hype values.
Finally,an investor may have a quite hard period performing deserving diligence on a stock with little available information Some of the aboard mentioned exchanges do never necessitate SEC filings.
Who Should Buy Penny Shares?
Once within a meantime a cent stock does elevate itself from the dregs and procure a nice self-respect As well, some companies fall on hard times and a comeback excursion could be equitable approximately the corner While never always cent stocks are horrible investments, who would recommend going to a hotdog stand and asking for a maximal rib steak?
Sources
"The Lowdown aboard Penny Stocks", Investopedia.
Lisa Lerer, "Why SEC's 'Spamalot' Won't Stop Stock Scams"9 March 2007, Jacoby, "Get Wise to Penny Stocks", 27 July 1999, CNN Money. 相关的主题文章：
These are the reasons why cent stocks longing lose maximum investors money.
The Penny Stock Myth
Myth: Penny Stocks are Cheap
Imagine someone worked apt the bank and wanted to cash among a 100 USD detain Would there be a financial difference whether the teller gave 100 times one USD bills, five times 20 dollar bills,Christian Louboutin Discount,or ten thousand pennies? The net amount namely alike.
The price per share of a stock and the market capitalization are two vary things Market capitalization namely the price per share multiplied according the absolute shares. This represents the utter value of new shares. Using the above instance presume the mall capitalization is 100 greenbacks The company has the option of issuing 100 shares by an USD every five shares by 20 dollars each,or ten thousand shares by an penny each.
Why would a company prefer apt sell their stock along pennies while they could give it a finer dignity according issuing fewer shares at a higher value Because they know is by pricing the shares inexpensive they give them the fantasy of creature cheap absence apt bring within marketing hunting investors. The company may well understand that institutions wouldnt touch them by any cost.
Other Dangers of Micro-priced Companies
Penny stocks may also be traded on pink-sheets alternatively over the counter publication boards. It is worthwhile apt memo is never always stocks aboard these exchanges need be cent stocks. If a stock is traded according these two means be discreet The standards of these exchanges can be very cheap Often,one ambition ascertain stocks namely were booted from a more trustworthy exchange.
Read on Where to Find Canadian Penny Stock Picks Finding Penny Stocks apt Buy Penny Stocks Watch List
If a cent stock is likewise a micro-cap stock,where can i buy christian louboutin shoes, meaning namely the mall capitalization namely less than 300 million greenbacks relying on citing source), this tin be especially dangerous. With such a low merit aboard the total shares,one investor may have liquidity problems. When purchasing illiquid stock, prices may skyrocket and then pew once the purchase is ended When selling illiquid stock, the cost may leak dramatically since few buyers exist.
Another caveat of illiquid stock is the pump and dump deed Such companies are susceptible apt spam form hype which aspiration have mercenary traders flocking apt buy,thus driving the price up. During this same duration of time the deceitful individual sells his shares. Anyone who purchased longing be very irate once the shares dump backward to their pre-hype values.
Finally,an investor may have a quite hard period performing deserving diligence on a stock with little available information Some of the aboard mentioned exchanges do never necessitate SEC filings.
Who Should Buy Penny Shares?
Once within a meantime a cent stock does elevate itself from the dregs and procure a nice self-respect As well, some companies fall on hard times and a comeback excursion could be equitable approximately the corner While never always cent stocks are horrible investments, who would recommend going to a hotdog stand and asking for a maximal rib steak?
Sources
"The Lowdown aboard Penny Stocks", Investopedia.
Lisa Lerer, "Why SEC's 'Spamalot' Won't Stop Stock Scams"9 March 2007, Jacoby, "Get Wise to Penny Stocks", 27 July 1999, CNN Money. 相关的主题文章：
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