Where to Buy Penny Stock http://wheretobuypennystock.org Learn Where to Buy Hot Penny Stocks Fri, 05 Mar 2010 20:26:43 +0000 en hourly 1 http://wordpress.org/?v=3.3.1 Where to Buy Penny Stock http://wheretobuypennystock.org/where-to-buy-penny-stock/ http://wheretobuypennystock.org/where-to-buy-penny-stock/#comments Wed, 17 Feb 2010 17:40:06 +0000 http://wheretobuypennystock.org/?p=10 If you are searching for where to buy penny stock, continue reading! Penny stocks refers to any stock that is trading outside of the major stock exchanges like the NYSE, Amex, or Nasdaq. Penny stocks are often considered high risk investments with a share price of less than $1.00.

Lured By Low Price

There is usually a future potential for fast growth that might appear to be happening if the stock is being actively promoted. According to the SEC penny stocks can lose value over night and are high risk investments that potential investors should be aware of. With most hot penny stock risks include lack of financial reporting, fraud, and hardly any liquidity.

Manipulation

No liquidity can make it hard to sell penny stocks and fast changes in supply and demand can lead to volatile stock price swings. With no liquidity and a high amount of volatility makes the perfect storm for manipulation. These conditions will also make eve the best penny stocks very hard to short.

Minimal Requirements

On the OTCBB there are only minimal requirements for penny stocks to be quoted unlike the NYSE or the NASDAQ. When penny stock companies fail to file with the SEC on time, do not meet minimum standards on the bigger exchanges, they are delisted. They will then relist on the OTCBB or what is called the Pink Sheets.

Pink Sheets

Shareholders are not protected when penny stocks are trading on the Pink Sheets. There is no regulatory listing requirements, minimum accounting standards, material changes affecting financial potential of a company, or do they show a change of ownership of shares. These are all protections on the bigger exchanges, but not when penny stocks are traded on the Pink Sheets.

SEC

The SEC takes care to point out that fraudsters abound on internet message boards saying the are unbiased investors. They may in fact be company insiders creating the appearance of a large interest in a penny stock by simply creating a large group of aliases. The potential for fraud and manipulation on these types of forums and message boards is extremely disconcerting.

Conclusion

You must actively do your research on these penny stock companies if you want to hang onto your investment portfolio and to find where to buy penny stock. Manipulation, fraud, and misrepresentation abound on the Pink Sheets with this kind of misdealing happening on a regular basis.

It is my recommendation to not deal on the Pink Sheets due to the high risk of being dealt a bad hand when investing in penny stocks that do have minimum accounting standards, cannot show changes of ownership, and their aren’t any regulatory listing requirements. Unless they are listed on the major exchanges I would stay away from the Pink Sheets unless you want to turn your financial future red.

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