| Investing in penny stocks provides
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| | if you buy a stock at $0.10 and sell it
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| traders with the opportunity to
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| | at $0.12, that represents a 20% return on
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| dramatically increase their profits,
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| | your investment. A 2 cent decline leaves
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| however, it also provides an equal
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| | you with a 20% loss. Many stocks trade in
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| opportunity to lose your trading capital
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| | this range on a daily basis. If your
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| quickly. These 5 tips will help you lower
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| | investment capital is $10 000, a 20% loss
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| the risk of one of the riskiest
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| | is a $2000 loss. Do this 5 times and
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| investment vehicles.1. Penny Stocks are a
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| | you're out of money. Keep your stops
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| penny for a reason.While we all dream
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| | close. If you get stopped out, move on to
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| about investing in the next Microsoft or
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| | the next opportunity. The market is
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| the next Home Depot, the truth is, the
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| | telling you something, and whether you
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| odds of you finding that once in a decade
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| | want to admit it or not, its usually best
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| success story are slim. These companies
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| | to listen.If your plan was to sell at
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| are either starting out and purchased a
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| | $0.12 and it jumps to $0.13, either take
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| shell company because it was cheaper than
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| | the 30% gain, or better still, place your
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| an IPO, or they simply do not have a
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| | stop at $0.12. Lock in your profits while
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| business plan compelling enough to
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| | not capping the upside potential.5. How
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| justify investment banker's money for an
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| | did you find out about the stock?Most
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| IPO. This doesn't make them a bad
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| | people find out about penny stocks
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| investment, but it should make you be
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| | through a mailing list. There are many
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| realistic about the kind of company that
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| | excellent penny stock newsletters,
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| you are investing in.2. Trading
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| | however, there are just as many who are
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| VolumesLook for a consistent high volume
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| | pumping and dumping. They, along with
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| of shares being traded. Looking at the
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| | insiders, will load up on shares, then
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| average volume can be misleading. If ABC
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| | begin to pump the company to unsuspecting
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| trades 1 million shares today, and
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| | newsletter subscribers. These subscribers
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| doesn't trade for the rest of the week,
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| | buy while insiders are selling. Guess who
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| the daily average will appear to be 200
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| | wins here.Not all newsletters are bad.
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| 000 shares. In order to get in and out at
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| | Having worked in the industry for the
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| an acceptable rate of return, you need
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| | last 8 years, I have seen my share of
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| consistent volume. Also look at the
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| | unscrupulous companies and promoters.
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| number of trades per day. Is it 1 insider
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| | Some are paid in shares, sometimes in
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| selling or buying? Liquidity should be
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| | restricted shares (an agreement whereby
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| the first thing to look at. If there is
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| | the shares cannot be sold for a
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| no volume, you will end up holding "dead
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| | predetermined period of time), others in
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| money", where the only way of selling
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| | cash.How to spot the good companies from
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| shares is to dump at the bid, which will
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| | the bad? Simply subscribe, and track the
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| put more selling pressure, resulting in
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| | investments. Was there a legitimate
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| an even lower sell price.3. Does the
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| | opportunity to make money? Do they have a
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| company know how to make a profit?While
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| | track record of providing subscribers
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| its not unusual to see a start up company
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| | with great opportunities? You'll start
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| run at a loss, its important to look at
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| | to notice quickly if you have subscribed
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| why they are losing money. Is it
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| | to a good newsletter or not.One other tip
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| manageable? Will they have to seek
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| | I would offer to you is not to invest
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| further financing (resulting in dilution
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| | more than 20% of your overall portfolio
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| of your shares) or will they have to seek
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| | in penny stocks. You are investing to
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| a joint partnership that favors the other
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| | make money and preserve capital to fight
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| company?If your company knows how to make
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| | another battle. If you put too much of
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| a profit, the company can use that money
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| | your capital at risk, you increase the
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| to grow their business, which increases
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| | odds of losing your capital. If that 20%
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| shareholder value. You have to do some
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| | grows, you'll have more than enough money
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| research to find these companies, but
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| | to make a healthy rate of return. Penny
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| when you do, you lower the risk of a loss
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| | stocks are risky to begin with, why put
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| of your capital, and increase the odds of
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| | your money more at risk? Penny Stocks |
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| a much higher return.4. Have an entry and
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| | investment strategies for penny provides
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| exit plan - and stick to it.Penny stocks
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| | penny stock traders with online trading
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| are volitile. They will quickly move up,
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| | and investment tips, online trading
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| and move down just as quickly. Remember,
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| | strategies and penny stock picks.
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