I like what this guy has to say,
By: DiscoDadda
Reply To: 1660 by DiscoDadda Friday, 18 Jun 1999 at 12:27 AM EDT
Post # of 1649
Strategy Regarding Penny Stocks
#1 Do not play a company for a 10% to 100% gain, play for minimum 500% gain this usually requires a degree of patience and several weeks of putting up with MM tricks.
#2 I call this stragegy the "shotgun approach". Do not buy one penny stock buy depending on your appetite 5 or 6...logic here is do research find situations (like CHES IMO) that could go up by a huge percentage...They all will not but one or two might...you can lose 100% on anyone of your investments unlikely but true but 1 or two huge winners more than make up for it.
For instance:
Invest 3,000 into 5 companies 15,000 total
Co A: you lose 50% value 1,500
Co B: you lose 50% value 1,500
Co C: you lose 50% value 1,500
Co D: you lose 50% value 1,500
Co E (CHES): you make 1000% value 30,000
Total Value = 36,000
This scenario requires DD and a constant weeding process...I have found that I seldom lose 50% because I do apply technical analysis...however if the "story" is good I will give them some time to "mature"
Besides long term investments in various mainstream investments I maintain a small portion of capital employing this strategy. Current penny holdings:
CHES (Ground Floor)
LOCH (Great Story)
CISI (Could Be CUT)
ARET (traded this one 6-7 times)
GAAY (Hate the symbol but looks strong)
SPAZ (Could Be The Standard DVD for PCs)
STOCKS I Have Made Money On Recently:
HNLY, STRU, IVOC, ARET, AREE (DOG got lucky), HVAR, PABN
Stocks I Have lost money on:
EUTO, BICO (do not buy this), TTRIF, will lose on CISI.
Stocks which I have an opinion:
MPTV (do not buy 3,000 in revenue massive loss and float)
AREE (Could goto zero)
Anyway, I have made more money trading these so called worthless stocks than my "mainsteam type investments" by far. I attribute this to several factors #1...The Internet and sites like RB #2...CPI Alan Greenspan Analysts Etc have no impact, It is simply News, Investors and MMs...
Good NITE (Great Stock) All.
Disco
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