Thursday, October 29, 2009

The Best Penny Stocks To Buy Now

What are the best penny stocks to buy now? The sad truth is that over 90% of all penny stocks go to zero. Think about it, stocks never start at pennies per share, they can only get that low if something has already gone dramatically wrong. Some people talk about how google and cisco and microsoft were att one time worth pennies, but that is not entirely true! The truth is they were worth a miniscule fraction of the price that they are currently valued at, but that doesn’t mean they were penny stocks. Stocks do something called a stock split, the stock price is cut in half, and the amount of shares available double. In addition the people who own shares are given the chance to own twice as much. So many stocks like MSFT or CSCO that were once penny based on it's current price may not have even been penny stocks at the time. If a stock was worth $100 and it did a 10:1 split it would be worth $10. Now if the stock had previously gone from $9 to $100 before the split, after the split it would appear as if it went from 0.90 to $10. So if people are thinking they can find a stock like that and that it will be the best penny stocks to buy now may be mistaken.

You have to really understand statistics if you want to invest in penny stocks and you have to apply it. If a stock either doubles or goes to zero, and you get it to double 10% of the time, that’s not good math. However, if the stock went up 10 times the amount and went from 10 cents to $1, then you have the system working. The way it works is you will lose 10 cents 9 times, then you will gain 90 cents. So that is the break even point. In order to maintain your ability to buy stock, you will need to be able to continue to invest. If you buy 10 stocks and you lose, you will be unable to buy any more if you invest 10% of your bankroll. You will be putting the odds against you. Now that’s why you need to never invest more than 2% of your bankroll. that’s enough to handle a few standard deviations. Buying penny stocks more so than any other is about money management. There are no sure things. The fact is most penny stock investors are hoping to get rich off a lotto ticket. It’s not really smart to buy penny stocks. It can be a reasonable strategy if you’re really know what you’re doing. However, there’s so many stocks out there, it’s better to focus on buying stocks. You should be looking for the best stocks to buy now, not the best penny stocks to buy now. If the stocks happen to be penny stocks, then you can still buy them, but understand that over 90% of traders go broke at least once and over 95% of penny stock buyers lose it all. That’s why there’s no room for me to give actual penny stock reccomendations because most penny stocks dont pan out, I’d be fighting the odds, and you have to understand that first before you think you know the best penny stocks to buy now. It’s possible to know the best penny stocks to buy now and still lose it all. The reason is, everything has a chance to go to zero, just as everything has some chance to go from its current price to double or triple. Penny stocks have the highest probability of going to zero. The best penny stocks to buy now aren’t sure things, they’re just “less uncertain” then all of the others. Maybe the best penny stocks only go to zero 70% of the time. Sure if you lose your investment 7 out of 10 times and make 10 times your money, it’s a good investment, but only if you have correct money management. Most people have $1000 to invest, and they invest $300, and lose it all, and then they only have $600, they invest $200 and lose it, they have $400, they invest $100 and they lose it and now $300, they invest $50 and then they lose and with $250 they invest $20 and the stock goes from $.10 to $1 ad they sell but now they only have $450 which is less than what they started with. They won on the 5th investment and had they kept all the investment size about the same, they would have ended up having tons more money than they started with. In fact, if they invested $50 5 times, they’d be down to $750 then they invest $50 more and they’d be up 500 to $1200 and it’s a 20% gain. Most people go broke not because they select bad stocks. They may be convinced that the free stock picks was simply bad advice, but in reality it may have been excellent advice that just didn’t work out. The cold hard truth is that you can’t really make money with penny stocks without good money management whether you like it or not. That leaves almost no room to really get rich off penny stocks, but you certainly can manage to profit. There’s a reason why you never hear stories of Warren Buffett or Monish Pabrai investing in penny stocks. First the market cap is sosmall they would probably buy half the company with the change in thir pockets compared to the average joe. Second, they never got rich off penny stocks because most of them dont work.

I’m sorry to be the bringer of bad news, but the best penny stocks to buy now aren't what you think they are!

Again, here's the best stocks to buy on the issue on good penny stocks:

What is the reason behind people looking for the best penny stocks to buy? Why must people demand that someone gives them the hot stock tip of which stock to buy? Cant you just be satisfied with the information provided in the best stocks to buy now home page? These are questions that perplex me. Why in the world would you even WANT a penny stock? Don’t people know that 9/10 penny stocks go to zero? How can you fight those odds? What’s wrong with just asking what is the single best stock to buy now? Anyways, even the best penny stcks have a good chance of going to zero. However, I’m not here to judge, so if you want a screen for penny stocks so you can find the best ones at any given instant, I can come up with something for you.

He then goes on and comes up with the stock US 1 INDUS INC (ticker symbol USOO.OB) as really the only penny stock he would look at, however, he made some minor changes to the screen and was able to find 10 others that may still make up the top 10 best penny stocks to buy now.

2 comments:

  1. Excellent blog very nice and unique information related to buy best penny stocks Your contents are progressing with days keep it up guys.

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