Pick Winning Penny Stocks



Posted: Tuesday, November 17, 2009

by Scott Rogers
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Good Day Folks,

Do enough due diligence and eventually you will find a penny stock with huge potential to the upside. As I have mentioned in previous articles, you need to beware, if you sign up for a newsletter, or service, that claims to have done all research for you. These services are sometimes self motivated. I have heard it stated that we make our gains in stocks, technically, with our entry price (buy). If we could buy a stock at it's 52 week low, and ride it to it's 52 week high, we wouldn't need to earn our living in a cubicle for much longer. There is no doubt that some good old fashioned luck, when picking your stocks is helpful, but it's a good practice to not count on this. Though penny stocks sometimes are not affected by day to day news, as are the stocks of larger companies, following a trading trend can be good practice. Many times you will see daily volume of shares traded spike. Many times an increase in volume precedes a rise in the price of the equity.

Establishing a penny stock fortune is definitely possible, but you'll need to put the time in to research. I have seen several micro-cap stocks return 900% or better, over the last several months. It's by doing the research, filtering out the hype, where you will find that small bio-tech company, that may have off peoples radar screens (you can buy it cheaply) when you learn that it may have a new drug in for FDA approval, other investors got tired of waiting and have moved on. No matter how you look at it, you are taking a great deal of risk of this somewhat risky, but very rewarding venture, when you research in depth. I can equate buying a penny stock to buying gas. With the recent volatility in the price of fossil fuels, we had a strategy in our purchase. Should we wait til' tomorrow, when the price may be lower? Or, should we fill up today? This is a rough, but not totally off the wall comparison. I have truly found, over the past year for me, I've done best when I've followed a stock over time and watched how it trades. I have made some super returns when I pull the trigger (buy) at the lower end of the spectrum. Please remember, many traders buy (when good news is out)or, sell(when some negative press is out)on emotions. I recently pick up shares of (ADPT), a data storage company, revenues were down off a bit, year over year, and traders fled as out of this stock. The fundamentals of the company were still strong. Adaptec has a ton of cash, an, at that time, was trading well below book value. I picked up my shares when sentiments were low, at $2.28 sold a few weeks later at $2.90, for a very nice 27%. The company was way oversold and trades in the $3.30 range, today. Until next time, happy trading and don't fall in love with your stocks!

DA

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About the Author

Get Micro-Cap Company Stocks delivered to your in box BEFORE they explode to the upside. Complete info on the gem I have listed for you is at http://www.pennystockgems.com. I have analyzed several stock picking services, over the last few years. My gem has come through consistently, delivering extremely accurate entry
and exit prices...

Trade beside me as we take our profits on momentum, and move on. My goal is to have us educated enough to decipher the opportunity at hand. With our articles, you will not be just placing a buy when my gems pick is delivered to your in box. You will, over a short period of time, be able to make an educated decision on the opportunity at hand.

Looking forward to having you on board,

DA

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