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Question by Grisel : 6,000K to invest! A first timer? What penny stocks should I look into?
I would like to know more about the market and really don?t have the resources or even know how to play the market. I dont want to loose all 6K for I have been saving for almost a year and finally felt able to take a chunk and invest.
Best answer:
Answer by talismb
I suggest you stay away from any stupid spam links your question is bound to attract! With that said my advice concerning penny stocks is: ?STAY AS FAR AWAY FROM THEM AS POSSIBLE!? Buying penny stocks is not investing, it?s gambling (with much worse odds than the casinos) 99% of all penny stocks tank and are worthless in no time at all, the magical bumps in price (you know how they advertise 1500% growth, most of the time its caused by the ?buy? recomendation?everyone runs out and buys the worthless stock, causing the price to go from .01 to .15 cents) then as soon as it peaks, the early ?investors? sell off and pocket the profits while most of the other suckers are stuck with worthless paper.
Answer by William M
I?d agree to stay away from penny stocks. They are thinly traded and most are scams. Instead invest into undervalued companies that have been hit bad by the recession, or invest into small-cap stocks with market caps of $ 200 million ? $ 2 billion such as oil or energy with great potential as they have potential to grow if they do well. Look into it and good luck!
Answer by Len
I?m heavily invested in penny stocks with about half my portfolio cash, the remainder is in more secure stocks with lower risk values. As of last night (Tuesday) my portfolios reflected an overall gain of 63% year-to-date (from Jan. 4th, 2010). Penny stocks have contributed massively.
Pennies require tireless watching and study for they can be treacherous. After all, investors are human and all the more so when investing earned dollars?so market volatility is a given, to be sure.
Take a look at these:
HDY
JADA
SGAS
CKGT
One of these is a Texas oil and gas exploration company holding the largest and most prospective off-shore lease in all of Africa. Another is the foremost high-quality jade mining company in the world. The other two are companies operating in The Republic of China. None of these companies carries any long term debt, all are on the move?higher, we hope. LOL
To learn more about them, visit:
www.marketwatch.com
www.investorvillage.com
www.investorshub.com
Type each ticker symbol into the search box and study all that comes up. Read what investors have to say but take everything with a grain of caution as many will tout their favorites. These are moving right now but I?m hoping you won?t invest in anything until you?re comfortable in the knowledge that you are ready to operate as an investor. These picks may not be appropriate for you when you?re ready to invest. Learn about the market first, that?s key to success.
Tune out the naysayers who caution you against doing as you wish. You want to know what you might look at, you didn?t ask for lessons in living your life or how to manage your wealth. Also, last year during the meltdown in credit markets, I loaded up on Bank of America at $ 4.96/share. That great stock was a penny stock at the time!
I love it when people gang up on penny stocks. Mutual funds lose money, too. The obvious difference is that people can blame their mutuals and the government for failure. When I play penny stocks or any other stocks, my successes and failures all rest on me.
Since you?re concerned you might lose your $ 6,000, why not begin with just part of it? Your results will be slower but at least it will afford you the room to make mistakes without destroying your dream.
Every stock tells a story. Fundamentals point to past results and enable us to evaluate business values but we all know there?s no future in history! Meanwhile, everything will depend upon your ability to add things up. This means grasping the corporate mission, the concept, the business model and plan, the character of management and as important as anything: You?ve got to anticipate how you will react to varying situations. This is so because human impatience and greed and fear work against us. Remaining calm and careful are more important than my words could ever be.
Best of luck to you. I hope you come to love this work as I do. Every day, rain or shine, is a joy when you?ve got some stocks in motion. Each one represents your choices and your dreams.
Len
Answer by Doctor Deth
do you want to lose all your money? if no, then stay away from penny stocks ? that is a very risky gamble ? any stock under $ 5/share is very risky or the stock wouldn?t be priced so low ? the majority of those companies are new and have little revenue and usually are losing money, so it would be insane to risk investing in them ? companies could even be fake and prices could be manipulated to the benefit of insiders and there may be no buyers when you want to sell ? see the movie Boiler Room
Answer by Jim L
Why are you interested in penny stocks? That is a good way to lose a large part of your money fast. Penny stocks are either make a lot of money (maybe 3% of the time) or lose most of it (97% of the time). If you want to do that, play roulette and bet a number on one spin. Basically the same odds.
I would either choose a couple of mutual funds or 2-3 solid long term stocks. If you feel like stocks is the way to go, then you could start with a couple of ETF (those are Exchange Traded Funds, mutual funds that trade like shares of stock) and then switch to single company stocks when you find ones you like.
Here is a link to Vanguard ETFs https://personal.vanguard.com/us/funds/etf/bytype
I would choose one Value ETF (symbol VTV), a small cap (symbol VBK), and an international stock fund (symbol VWO) with emerging market exposure. Look for yourself though, and make your own decision.
Single company stocks right now are hard to pick because many are overvalued. If I had to pick three for the long term, I would try Ford Motor (F), Freeport McMoran (FCX) and something like Kraft (KFT) or Altria (MO) the last two which have pretty nice dividends.
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