Penny Stocks for Dummies: 7 Secrets Famous Book Does Not Reveal!

Penny Stocks for Dummies

Penny Stocks for Dummies is a popular book written by a penny stock guru, Peter Leeds. The author introduces investors to the basics of penny stocks trading and reveals quite a few secrets and strategies that are supposed to make you rich. However, there are some secrets that were left under the cover. Another famous penny stock expert Timothy Sykes has a different approach when it comes to teaching penny stocks for dummies subjects that you can check out below.

1. Ride the Bull Carefully

This is definitely the secret that the famous Penny Stocks for Dummies book does not reveal. The bull market is synonymous with the joy and high hopes of investors with the common and penny stock on the rise situation. It might seem ridiculously easy to find penny stocks lists to invest into because all of them are going up. Watch out during the bull market, because it is when the most scum floats to the surface. Since the investors are giddy from the flourishing markets, they are more likely to be more adventurous and get caught in the scam scenarios when worthless penny stock companies are pumped up by mass and social media marketers to crash a couple of weeks later and leave its investors in the dumps. According to some of the best-hidden secrets, now is the best time to find penny stocks to short later when they collapse.

2. Watch the Bear

In the bear market, everything is looking gloomy and dark, investors are depressed about the dwindling nature of their investments and are very hesitant to spend their money. In fact, this is the time to start buying promising penny stocks because their prices are so low. Smart value investors actually love bear markets because they can finally start enriching their portfolios with worthy finds. According to Timothy Sykes, the bear market is when you should start being more aggressive about stocks that you previously could not afford. Is the Penny Stocks for Dummies book telling you to do that?

3. Shorting Can Make You Money

Any market analyst is going to think you are out of your mind if your decide to start shorting penny stocks, especially if you are new in the market. Did you know that if you do it right, it can bring you 30-70% returns on your investment? You can short penny stocks by first identifying overpriced companies that you think will not be holding up their value for too much longer. The next step is to find a broker who is willing to lend you a set of shares for a fee. Alternatively, you can consider purchasing a put option obligating you to sell stocks at a certain price on a certain day. Once you have your stocks, you can now sell them for a high price and wait for the prices to start coming down. Once the prices are down, you can repurchase the same set of stocks and successfully return them to the broker. The difference between the sale price and the purchase price of the stocks is your profit. While the hardest piece of the puzzle is finding qualifying stocks, once you train yourself to analyze market trends and companies, it becomes easier with time.

4. Keep a Trading Diary at Profit.ly

Never trust your instincts when it comes to deciding which penny stocks to watch, keep an extremely detailed diary online on trade patterns that need to be repeated or the ones that are better avoided. Trading randomly will only result in losses overtime, however if you have a set plan in mind and you know your entering and exiting positions are, you will start making money in the right market. Profit.ly was inspired by Timothy Sykes and created to help his students get introduced to accountability and data optimization to help them succeed. Profity.ly’s comprehensive data analysis platform takes all the guesswork out of penny stocks list to buy.

5. Do Not Trust Press Releases Blindly

As the popular Penny Stocks for Dummies book explains, penny stocks and scams go hand in hand and most stock companies face “pump and dump” schemes sooner or later. The most important secret of handling penny stocks risks is understanding the patterns of penny stocks newsletters and how they affect the price and use it to take advantage of the market situation.

6. Cut the Losses and Stop the Bleeding

Investors’ egos normally get in the way of this one secret, especially after reading Penny Stocks for Dummies book and feeling invincible and “know it all”. If the stock is not working out for you, take a loss, stop the financial bleeding and move on. There are hundreds if not thousands of great penny stocks to buy out there. Some investors just prefer “I’m in for the long run approach” and can lose tremendous amounts of money if not proactive. It is always better to lose a couple hundred bucks, quickly rethink the market scenario and move on.

7. Stay Away from Non-Liquid Stocks

Ignore non-volatile penny stocks like they are plague; they are not going to make you money. They are hard to get out of if the situation presents itself though most of them gradually increase in price and they may have a good story behind the company. Timothy Sykes recommends an entirely different strategy of skimming the cream of one stock and move on to the next great deal and not being stuck with one company for the long run.

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