Mark,
I appreciate your input, but would like to add a few comments. This is not my first venture into penny stocks. I agree with you that MMs play games... particularly if they're short and even if they're long and want to get stock to sell (that's how they make a living!!). But, they can only play with what's available for them to buy in the market. Hence my commentary about the "relative" float. For arguments sake, let's say I put up the 9 million to buy the entire float (don't think I'd get it for .52/share <VBG>) and locked up the shares in a Trust... not for sale. Let us now assume the Company does well and lives up to or exceeds expectations. We now have the reverse of an old expression. The scenario is: you want to buy stock... from who? Thus the float, not considering option selling or secondary offerings or private placements, is for all intensive purposes... nil!! I've been there, Mark.
Most people who buy penny stocks are looking to retire on one stock... and they will lose. The vast majority of penny stocks never make it, but those few that do, reward their early investors more than you can imagine. Sure there are ups and downs, but if you don't believe in the company and do some DD and follow the progress, then, IMHO, don't buy the stock. You can position trade "pennys", but that can be dangerous... news can affect it too quickly and harshly (or beneficially).
Regarding Nasdaq v. OTC:BB. You're correct... except that most startups begin on the BB and, hopefully, work themselves up to a full listing and that's when the fun begins. After all, Mark, how much could you afford to buy IF the publicity was already out on CNN, CNBC, the WSJ, ID, or any other national media? As you appear to know, there are daytraders, position traders, and investors. Most people actively involved in the market have separate portfolios for each category. Contrary to popular belief, if someone does their homework, the biggest "hits" come from the long term investments. When I bought MSFT in the early '80s my friends though I was crazy not to sell at around $25. Maybe I was, but I still haven't sold a share. When I bought Diamond Field Resources at a little over U.S.$1.00, friends thought I was crazy not to sell out at $16 a year later. I didn't. I waited until DFR was bought by Inco at over $180/share (pre-split) the following year and sold my Inco stock the next day.
Mark, I took a start-up public back in the late '60s and was the principal stockholder and Chairman of the Board until I had a heart attack (not because of the Company <G>)and sold out my stock at $16 for personal reasons (versus our IPO at $2 only a year earlier). I know the game only too well. My neighbor across the road from me here in the San Francisco area was the VC who took Bill Gates public... for which he made a tidy sum and a barrel of stock (all of which he still owns BTW). Bill Gates had his engagement party there quite quietly!! The big money was, always has been, and will continue to be made by those people who do their DD, buy a piece of a Company, and put the stock away until something within the Company changes dramatically. Just my opinion, but I've made plenty by daytrading and taking positions for a few weeks or months for a "pop", but nothing compares to the rewards of picking the right Company and staying with it. You're right... some will sell when it gets to $2 or $5, but, if my gut feeling is right these same people will be telling their friends and family about the stock they bought at $0.25 and sold at $2 a few months later... but now, a few years later, after it has a complete listing, it is selling for $100 or so pre-split. It may not happen often, Mark, but it does happen. You just have to be in the right place at the right time and have the guts to ride it out. Wasn't it Harry Truman who said: "If you can't take the heat, get out of the kitchen."? Marty says: "If you want to be a Master Chef... stay in the kitchen and sweat a little."
I still hold to my original premise. Put away your TSIG stock and if the majority do the same, the MMs will eventually move on to greener pastures. Secondly, do some business with your Company. It not only helps them, but more importantly, gives you a better insite as to how well they're running your business. If management makes money... so do you.
Best wishes always,
Marty
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