Greg, I like Don will try and give a little insight.
First of all Greg, there is no investment too small. I personally believe that a person should only invest the dollars they are conformable with and no more. I don't know what your broker is charging you for commission on your trades, but that has to be a strong factor when considering buying very low priced stocks of any kind. Let me give you an example and maybe you are already aware of it, but here goes anyway.
500 Shares @0.80 + $60 commission = Tot Investment of $460.00
or a per share cost of $0.92
If you were to make a net profit of like you said of 10% you would need to get a gross selling prices of approximately $580.00 or $1.16 per share, which would leave you with a net profit of $60.00.
Your total investment based on the above would have been $460.00 purchase cost + and additional $60 commission for selling or $520.00 leaving you with the $60 net profit or a 10.4% profit.
YOUR BROKER would have made $120 or 20.8% vs. your $60 and 10.4%. As Don Roberson said, Your Broker will LOVE you. Brokers and in the business of having you buy, sell and take all the chances, because they win no matter how you come out.
The first RULE in investing in low price, startup companies is that any money you invest must be looked at as potentially lost. If you can not do this than you should not invest in the stock. Take a look at the following web sites for some very general investment advice, just click on each one below:
cunamutual.com
personal32.fidelity.com
Secondly, as I said before you must be will to put at risk all of the investment in order to gain larger rewards. Generally the larger or greater rewards come in the LONG TERM, which means you are willing to hold for months or even years. If a person can not or is not willing to do so, they should then re-think their position on any given stock or stocks in general for that matter.
Thirdly, the old clich‚, "Don't put all your eggs in one basket", if very pertinent for all who invest in stocks. It is critical that an investor spread their investments around. Using on a small percentage of their investment dollars for low cost stocks or penny stocks as they are commonly call. The percentage of the investment dollars will very from investor to investor. My rule of thumb is a maximum of 10%.
Fourthly, and maybe the most important factors are as follows.
 Do you own due diligence and research on every stock you buy, never just depend on the advice of others.
 Have has clear a picture of the investment objectives of any given stock that you invest in, i.e. what do I really expect it to do for me, etc.
 Hype should have no place in the decision making process of purchasing stock.
 Set the maximum you will pay for a share of stock and stick to it.
 Pay as little commission as possible. (Shop for brokers if necessary)
 Set your stop price or where you must sell if need be and stick to it.
 Invest only the dollars in a stock that will allow you to sleep at nights without worrying about that investment.
 Never borrow money to buy stock. Always use available dollars that are not necessary for you to live on, either today or in the future.
 Never be afraid to ask questions. Nobody if dumb or stupid, they are just uninformed. Unless you are willing to inform yourself by asking questions you will stay uninformed.
 MOST IMPORTANTLY - YOU MUST BELEVE YOU THE STOCK (COMPANY) YOU ARE INVESTING IN.
One last example:
If you feel you want or need to take a profit on a stock (and there is nothing wrong with that) you might consider the following.
Say you purchase 1,000 shares of a stock at $0.80 + a $60 commission you would have a investment of $860. Let's assume that the stock goes to, say $2.00 a person could sell 500 shares with a selling commission of $60.00 realizing a return of $960 or a net profit of $100. The investor would be retaining 500 shares of the stock with no investment cost. So, if the stock continues to rise they have much to gain. On the other hand if stock looses all value (not likely if the investor watches the stock) the can't loose anything but the appreciated value, because they have recaptured all investment cost plus a small profit on the first 500 shares.
Don Roberson offered you very good comments be sure you take time to digest them along with the posting of the other on this thread. There are so many fine people on this thread, I would not dare to try and name them all for the fear of forgetting someone. It is my fondest hope, desire and belief that all the investors in FNTN will receive rich rewards.
Greg, hope this helps you, I wish you the best as you invest in your future. You are the one who is control.
A long investor in FNTN. (Long to me means whatever time it takes for FNTN to reach $20 or more and this is only my opinion.)
Bill Fortune III
PS Greg be sure to read Post #1611 from TMK. |
