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Pros and Cons of Penny Stocks

1644 ratings | 163422 views
In today’s episode I’m going to share with you the pros and cons of penny stocks. Penny stocks are hugely attractive, and they are great for certain types of traders. But they’re horrible for other types of traders. In this episode we’ll cover the advantages and disadvantages of penny stocks, so that way you can make a rational decision to see if penny stocks are right for you. We’ll talk about things such as their low price, manipulation, getting delisted, regulation issues, risks related to penny stocks, and more. Posted at: http://tradersfly.com/2015/02/pros-cons-penny-stocks/ ★ REGISTER FOR A FREE LIVE CLASS ★ http://bit.ly/marketevents ★ GETTING STARTED RESOURCE FOR TRADERS ★ http://bit.ly/startstocksnow * Please note: some of the items listed below could and may be affiliate links ** * Trading Software / Tools * Scottrade: http://bit.ly/getscott SureTrader http://bit.ly/getsuretrader TC2000: http://bit.ly/gettc2000 TradeKing: http://bit.ly/gettradeking TradeStation: http://bit.ly/getstation ★ SHARE THIS VIDEO ★ https://youtu.be/eJnh_1mmOUM ★ SUBSCRIBE TO MY YOUTUBE: ★ http://bit.ly/addtradersfly ★ ABOUT TRADERSFLY ★ TradersFly is a place where I enjoy sharing my knowledge and experience about the stock market, trading, and investing. Stock trading can be a brutal industry especially if you are new. Watch my free educational training videos to avoid making large mistakes and to just continue to get better. Stock trading and investing is a long journey - it doesn't happen overnight. If you are interested to share some insight or contribute to the community we'd love to have you subscribe and join us! FREE 15 DAY TRIAL TO THE CRITICAL CHARTS - http://bit.ly/charts15 GET THE NEWSLETTER - http://bit.ly/stocknewsletter STOCK TRADING COURSES: - http://tradersfly.com/courses/ STOCK TRADING BOOKS: - http://tradersfly.com/books/ WEBSITES: - http://rise2learn.com - http://criticalcharts.com - http://tradersfly.com - http://backstageincome.com - http://sashaevdakov.com SOCIAL MEDIA: - http://twitter.com/criticalcharts/ - http://facebook.com/criticalcharts/ MY YOUTUBE CHANNELS: - TradersFly: http://bit.ly/tradersfly - BackstageIncome: http://bit.ly/backstageincome
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Text Comments (199)
ed (17 days ago)
Penny Stocks are good if you do your research about the company. However, don't bet your money you cant afford to lose on Penny Stocks because they are risky investment coz either you get riched or you get broke.
tony a (1 month ago)
when your starting with only $500 , you dont have any choice but to buy penny stocks , thanks for the vids , very well explained
Jason Gayler (1 month ago)
really good share. thank you! do you trust bar chart's opinion w/regards to these stocks.
the only opinion you can count on is your own when it comes to a stock
Underwear Baker (2 months ago)
This is a waste of time spare it and go watch something else. He is just poking around the bush, and not saying anything that can be usefull.
thanks for watching and sharing your opinion
TREX LEX (2 months ago)
Damn it Penny stocks you so cheap but you are like the Mega lottery......................LOL.
Rex II ForSure (3 months ago)
My friend made me cringe when he said he thought the federal government steps on once a stock goes below $5 so people don’t loose to much money. When I told him that A not the way it works he said the government should step in. Wow!
everyone has their opinion... Thanks for watching the video
jay fox (3 months ago)
I remember my first penny stock it funny but it a true story. I brought 400 shares of hmny and it went from 4.95 to 3.50 so I thought nothing of it because it went to $6.00 two weeks ago. so each day it was losing 5 cents and I thought nothing of it. But something strange happened. when I was in the airport bus line I saw a guy who looked like the coo for movie pass walking in the middle of the high way with a black suit on. I said to myself omg that guy look just like the coo from movie pass. But i kept the stock anyway I SOLD it at 2.00 right now it trading 0.01.
Thanks for sharing your story
Vicki Bee (4 months ago)
I always heard the opposite. Something that's cheap is NEVER good, according to the people I grew up listening to. They used to say "You get what you pay for," and Wal-Mart's cheap products have proven that statement right beyond all doubt. I'll never buy a damn thing from them again.
It's true that oftentimes cheap things are not durable or just don't last. But keep in mind we are at that point talking about things that depreciate with time. When you're looking at Investments you're looking for things to appreciate with time and grow in the future so if you buy things that are lower price than you're hoping that they appreciate in the future. Now yes higher price things are typically better in terms of quality but that also means that the price extension may be a little bit too far stretched when it comes to an investment so this is why people often like penny stocks it's because you're getting it at a lower value looking forward to appreciate in the future but in general yes cheap things are cheap for a reason
timotius (4 months ago)
You don't hold penny stocks for a long term or swing. Only daytrade, momentum or even scalping trades.
travis romine (6 months ago)
Great advice as always. Thank you
Devin Gagne (9 months ago)
hey i was struck by lightning (:
Richard Fernandez (11 months ago)
How the hell did you learn all this stuff for someone so young? Your a true leader kid.
Joe Mihalek (1 year ago)
Can i contact you please. I wonder if i could use you as a mentor of sorts, or rather ask you questions that you some questions privately that you may have answers to
lance pheng (1 year ago)
I saw 65 million day volume in one penny stock.. lots of erational exuberance at the moment.. I have 5 penny stocks in my portfolio over 50 percent gain.
SOILFIT (1 year ago)
I found a penny on the floor drinking a beer and watching..should I promote it?
Jozeff Agaton (1 year ago)
Do you even trade? Sounds like your not a penny man. If you know what you’re doing penny stock is just like all stock. Strategy is everything!
Marwan M (1 year ago)
Nice vid. My question is, should take in account the market cap size + float + Price? meaning to stay a way of penny stock, should trade market cap that is mid or large and float size is huge? thanks
George Kirton (1 year ago)
I live in UK and work and work 2:30pm - 10:30pm shifts which in EST time is 9:30am - 5:30pm. Does this mean I'll miss the markets so can't trade Penny stocks ? 🙏😩
Steve Moore (1 year ago)
guys don't do penny stocks just buy sbux stock
Xtragicfever (1 year ago)
People that buy into crypto coins should watch your video. These people think every new coin on the market is a new way to get wealthy overnight.
gabriel abonga (1 year ago)
great advise man..
Alpaca Male (1 year ago)
I can't stop seeing Dane Dehaan when I watch this guy's videos.
Darryl M. (1 year ago)
I wish they were more affordable to trade on tradeking. Could tradeking just deduct the commissions u have from the cash in your tradeking account?
Savage Dispatch (1 year ago)
Sounds like its safer to cook meth and sell it.
Jack Vorozheykin (1 year ago)
great vid !
Alicia Lee (1 year ago)
become an Amazon FBA seller in books - use online arbitrage software to buy books then have prep company get it to Amazon's warehouse then set a repricer. You'll double your money within a year
Erik G (1 year ago)
Alicia Lee you sell with amazon fba and do you recommend it
H Sin (1 year ago)
Yes make sure you invest no more that you can lose, because your gonna F$%^&^% lose it! LOL
J. L. (1 year ago)
Penny stocks are definitely for your sandbox, not your lockbox.
Chuck Finley (1 year ago)
Thanks Sasha, I am just starting out trying to learn learn a bit before I try anything with stocks. I appreciate you sharing knowledge!
Fadi A (1 year ago)
if i cant get shares to short, i dont trade them lol
Fadi A (1 year ago)
dam right screw penny stocks
Stayler17 (1 year ago)
Why not learn to trade the bigger stocks now? Well just the simple face that it's too expensive. Once i make 1 million them i'll move to normal stocks. But penny stocks or even options is better for someone who doesn't have all that money to start with.
Matt t (1 year ago)
Sorry Sasha this is bad advice..
Matt t (1 year ago)
Be fearful when other are greedy and greedy when others are fearful
I am looking a stock cause of TSLA, it is ECS "COBALT". It was once $67per share in 1996, however it is now a penny stock at .89cent.... Would you say this stock is be more attractive than a new penny stock?
izdagrimeyone (2 years ago)
One thing i found about penny stocks, is they do good then go bankrupt and open up as a new company.
Jake4rmStateFarm (2 years ago)
do you work at a financial firm?
Mr Log (2 years ago)
Great video man!!!!
Michael Collington (2 years ago)
my take from penny stocks is basically....because the risk is higher the potential for greater percentage return is higher
Michael Collington (2 years ago)
but weren't alot of current big companies once penny stocks?
George Sharp (2 years ago)
The SEC says this is crap http://www.theotc.today/2016/12/sec-publishes-white-paper-looking-at.html
ChrisRants33 (2 years ago)
True, but the stocks have been tampered for a while. Get your money siphoned.
Daniel Maguire (2 years ago)
Stock markets are for the most part secondary markets unless it is an ipo. Same as selling face to face. They are both secondary markets. The secondary market is buying/selling stocks after the ipo.
It’s Omar (2 years ago)
thanks for the advise do know what's the name for a company stock your talking about
siraz rocky (2 years ago)
Very nice video man.
luis looey (2 years ago)
love how you do this to really share knowledge. I can see that you really want people to learn thru your videos. thank you so much
Can you recommend a good broker where you dont have to transfer $2000 to start an account?
K Mcleod (2 years ago)
I won't bother learning more about penny stocks. I'll stick with the big dogs.
Gummi Tarzan (2 years ago)
K Mcleod (2 years ago)
Not worth the time.
Cha zzy (2 years ago)
K Mcleod wait why, please explain to me
Anddres Torres (2 years ago)
I have 3 dollars
Jai Evans (2 years ago)
Great video thanks
Penny Stock Wolf (2 years ago)
Does this guy trade or just sell courses?
CringeGod (2 years ago)
If a company files for bankruptcy, letting the srock sit there for years isn't the best idea. correct? I don't know how they could go back to full form and get me profit
mariano garcia (2 years ago)
Dear Sasha I would like to ask you what do you think about TIM SYKES?. I watch his videos and I am a beginner follower of him? Thank you
abdel belhadj (2 years ago)
this guy is always giving very informative and high quality teaching i learned so much from him and i am still learning
Vicki Bee (4 months ago)
He reminds me of Eric, someone who was near & dear to my heart. Eric didn't have money at first & worked his butt off for everything he had and had "integrity" in business. It IS possible; they wouldn't teach 'business ethics' if it weren't possible at all. He worked for everything he had so he was grateful for it.
Amit Deshpande (2 years ago)
Very Informative Shasha !!
Rah Rah (2 years ago)
So I wasted four hours watching all of these TIMOTHY SYKES videos? I was pretty hyped. NOT with grand dreams of millions but it see like a good way to start with this 2k I can afford to work with. Anyway should I unsubscribe from him? (Chuckle)
Rah Rah (2 years ago)
Well that was my exact plan and he seemed like someone I could relate to....until I heard your take on it. I mean imagine it. I am a TOTALLY NEWBIE OUT THE WOMB so time for poison milk. Not even able to to tell which is which.Don't know if I need someone to relate to just need some one to be str8 up with the truth whether I can relate to them or not I CAN ALWAYS RELATE TO TRUTH! :-)
Burberry Perry (2 years ago)
I'm 15 should I sink 100$ into this or is it just a waste?
Samuel R (2 years ago)
Hey bro penny stocks are a potential way to make money. Make sure you do your research before investing, and remember only to invest what you can afford to lose. I would say build your account to about $500 - 1k and study in the mean time, before making your first investment. Good luck!
Ariel JJ (2 years ago)
So how many times a year do you buy stocks? Do you invest every month or invest a one time sum and let it sit there and stock up?
Ashfaq Miah (2 years ago)
Sasha I'm over in the UK, what platform would you recommend I use to begin trading?
Ashfaq Miah (2 years ago)
Thanks! I'll take a look
Watzegik Datzegik (2 years ago)
Ashy Miah DeGiro, very cheap and low pricing. But I'm in the Netherlands, so I'm not quite sure if it's an international platform... (I believe so)
Ashfaq Miah (2 years ago)
Phoo, a £10,000 minimum deposit is quite steep for a student haha
Murad Shawar (2 years ago)
It just has to go up 10 cents
Murad Shawar (2 years ago)
look at MJNA
Murad Shawar (2 years ago)
+Fangz c3 which one is that
Christopher P (2 years ago)
I have a question. Say I invest $500 in penny stocks and then it dips below the price I got it at, can I just wait until it goes above what I paid for it to make a profit?
mrbigdaddyboss (2 years ago)
im not the best trader who do you recommend me to invest in ? like sor domeone to trade for me so i can make a income from it
Nicholas Khrushchev (2 years ago)
I am interested in shorting penny stocks , do you have any advice ?
Keegan Mac (2 years ago)
Always had a question... If the stock goes up a couple dollars and you try to sell it? Who would want to buy a stock at that high price? Please answer
Life Track (2 years ago)
@ Jonathan Taimam: I need to do that bro (from $500-$10,00). Are you willing to share how you did it? You can send me a private message if you want.
vyvanzeWoW (2 years ago)
awesome video thank you!
Jonathan Taiman (2 years ago)
I just want to say thank you for all of your videos. They have helped me go from $500 to $10,000 in 3 months and I plan on hitting that million dollar mark one day in the near future. Thank my friend.
still reading? :)8888 (1 month ago)
Jonathan Taiman did u pay taxes?
rkonar83 (2 years ago)
Hey Jonathan, How's it goin? I would like to ask for your advice what are your tips and strategies to becoming a successful trader. Hope to hear from you soon. Cheers! Raj
Ariel JJ (2 years ago)
which stock did you buy?
Conner Rayner (2 years ago)
can you trade penny stocks in the uk
mrbigdaddyboss (2 years ago)
do you recommend any discount broakers ?
xxxxpurepvpxxxx (2 years ago)
interactive brokers IS Best imo
mrbigdaddyboss (2 years ago)
+Sasha Evdakov (TradersFly) thanks for the info.
Dexter Speights II (2 years ago)
Don't laugh, MNST - Monster Energy Drink was a penny stock 16 years old under a dollar a share at 0.25 - today MNST trades at 153.54 6/12/2016. The Reward outweighs the risk! Everybody want to catch the train after it leaves the station. nobody wants to wait 2 hours to catch the express train!
21golden007 (2 years ago)
You said the good majority of penny stocks that spike will sell back off after spiking. It seems like a good strategy to have would be to short almost all penny stocks that spikes since the majority of them fall shortly thereafter. Also this spiking and sell off, does this occur over 2 minutes? 5 minutes? an hour? a day?
Watzegik Datzegik (2 years ago)
21golden007 lol, 2 mins a day? This maybe happens once in 3 years
JAVAD TALEBI (2 years ago)
Thanks Sasha for great information, would you please train us that how we can create a watch list of penny stocks ! in Australian market I don't know how to find them. Thanks a lot.
lilyjayjaykelvin Leal (2 years ago)
great video
Joli sad (2 years ago)
He is great but i dont know why he keeps talking about people who have 1 million dollars or half a million ? Like if somebody has 1 million dollar so he knows how to trade 🤔
Tyrone Prince (2 years ago)
Dang man,I wish I could trade good as you;) I trying to learn thou;)great video great information.
Carlton (2 years ago)
Thank you !!
ELIAS HERNANDEZ (2 years ago)
Josiah Bergen (2 years ago)
ROFL he clearly doesnt know anyone who trades pennystocks 😂 And duh pennystocks are failing companies, but you're a freaking trader, not an investor. You ride spikes and dont hold for long periods of time.
Josiah Bergen (2 years ago)
And if you do research you know when a stock is getting pumped and can make a lot shorting it. And manipulation from large investors never works on pennystocks unless there are billions of shares (which there rarely are) Because as soon as you start selling your massive amounts of shares everyone will see huge selling asks and everyone will be selling and it will tank and you'll lose money since you cant get rid of your shares.
Don't Touch Me (2 years ago)
Very nice explained, thank you
DJ DECEPTION (2 years ago)
i tried to establish eye contact for 10min and 36 secs... i failed
mcalann (6 months ago)
DJ DECEPTION I knew the first comment I read on this vid would be about that lmao 😂😂😂
thanks alot
onlycec (2 years ago)
This nigga made this video just to sell us his product.
Tyquaan Staton-Fuller (1 year ago)
sun shine lol why'd you get so triggered? And technically a view is valuable as hell to a ytuber. Just saying
juan puablo (1 year ago)
onlycec seems to me EVERY YouTuber is doing the same
Kasper Krazy (1 year ago)
sun shine he doesn't have too
sun shine (1 year ago)
and you, the nigga, watched this video to get info for free to earn big money, without giving anything in return. Sucker.
Close up bowls 420 (2 years ago)
simo casa (2 years ago)
I know they bad, But Penny Stock is for the little guy, And penny stock is the fastest to grow your portfolio, Also is the fastest way to go bankrupt, is a risk that is worth a try
Mike (2 years ago)
I'm 16, what can I do now so I fully understand the stock market when I'm 18 so I can start
Edmond Mahmoodi (2 years ago)
the best video I'm just starting with 50 bucks hope i could learn
Hedi Benmbarek (2 years ago)
Just throw like 20 k on a penny stock and be quick on the trigger !!! Pump it and dump it as fast as u can....thats how u can build a fortune but then again u got a know what u doing.,,.
Brad K (2 years ago)
"Just throw LIKE 20K!" "Quick on the trigger!" "Pump it and dump it!" "Johnny on the spot!" ....RIGHT!!!! ..................yeah. sure.
Hedi Benmbarek (2 years ago)
+Funny obviously if there is liquidity!!! U do ur research , but most of the time when a penny stock is pumped and dumped the liquidity is there since the stock is manipulated.
Siddhanth Amarnath (2 years ago)
you need buyers for that and liquidity is low in penny stocks...
MrCursor (2 years ago)
Even if penny stocks can get heavily manipulated, you can profit when they get pumped, so I don't see what's wrong with that as long as you don't put your bar for profit stop to high.
muno jiu (2 years ago)
so stock price manipulation is legal?
drmodestoesq (2 years ago)
+muno jiu The problem is proving it in a court of law. Like insider trading.
TheMostRealDeal Ryan (2 years ago)
Delisted stocks have lost me 20k dollars plus but penny stocks which are successful have gone 150k plus so its all good
Bravo Prescott (1 year ago)
Daniel Cressy It's just really volatile. I invest penny no doubt, you just got to look for the occasional pump and dump and ride the waves
TheMostRealDeal Ryan (2 years ago)
+Dusan Stanojkovic Well I look at highest fallers and risers and see where they go
Dusan Stanojkovic (2 years ago)
+TheMostRealDeal Ryan How to start doing research on companies?Do You start from google,and from watching the markets alone,or do You need something that will get You into the inner circle, or hiring professionals to do it for You?
TheMostRealDeal Ryan (2 years ago)
+Daniel Cressy One thing to understand is the risk I find 1 in 100 good stocks that I would put my money in but I would do your own research on the companies and managers track records for safety
Joseph Zlnay (2 years ago)
Great video! Thanks for the help
Michael Y Kwon (2 years ago)
wolf of wall street introduced me to penny stocks
Michael Y Kwon (1 year ago)
I was all in rlog 1.29-3, urre 1.45-4, now imnp 2.49-5
Jacob Wohl (1 year ago)
And the Wohl Of Wall Street told you to stay away from Penny Stocks
d4v1d5c0tt (3 years ago)
What does it mean to go in short?
Kevin D (2 years ago)
+d4v1d5c0tt Shorting is selling a stock before you have it, then you can buy it back later for a lower price.
Mr H (3 years ago)
You profit from stocks going down. Just the opposite of long trades. You need a margin account to short stocks. There is more risk involved.
dieyoung (3 years ago)
i love your videos. very clear and easy to understand
Eugenexgates 96 (3 years ago)
Hey Sasha, what do you think about selling short on obvious pump and dumps? Shitty company profiles, obvious hype promotions, and finally selling short when its showing signs of dumping?
Daniel_St 87 (3 years ago)
What kind of account do you need to trade penny stocks? do regular accounts work? any recommendation? If you live in Canada whats my choice?
yogurnobebible (3 years ago)
i had always this question... if i want to sell a stocks, do i need a buyer if i do it by a broker? or it will be sold inmmediatly at a market price?
Jack Hand (1 month ago)
Always buyers and always sellers, just at what price?
Grizzly876 (3 years ago)
Thanks man, good information for beginners
Ahlen Kikuchi (3 years ago)
hi, how much capital do you prefer in order to start trading stocks and gain a huge profit?
__ Bilak_78__ (3 years ago)
+Ahlen Kikuchi if you want 10,000-100,000+ you can put 5,000-15,000+. But remember look at the history of the stock and how much debt it owes to the bank. If the debt is more then there "reserve" money then no doubt it will go bankrupt in a few years . P.s start looking to the company called 'Corning' there really cool and have a potential of getting 1000-2000%+ in the next few years.
Ahlen Kikuchi (3 years ago)
+Sasha Evdakov (TradersFly) lets say for a 10,000 to a 100,000 dollar profit, how much capital would I need?
Eugene Podgornyy (3 years ago)
Penny stock dreamers. I like this. :-)
Stockstats (3 years ago)
Phatnaru0002 (3 years ago)
Would you say penny stocks are a good way to gain stock market experience without much risk?
Mustafa Ali (3 years ago)
Sasha, what do you think of Timothy Sykes?
Mustafa Ali (3 years ago)
+Eugenexgates 96 thanks for telling me that. I appreciate that. Now, I'm more active on real estate and land development overseas as well as gold investments
Eugenexgates 96 (3 years ago)
+Mustafa Ali Tim Sykes has been audited and hes on profit.ly that makes him completely transparent and legit if you're doubting him. On the other hand, many of his students are consistently making profits, and you cant lie on profit.ly, it tracks your trades and posts it. If he really only cared about money he could've chose not to teach and just buy all the stocks up that his students would be buying today and profit from it. Ive personally made a shitload of money by selling short on obvious pump and dumps. Pump and dumps are dangerous when you are completely clueless about it when you buy them, but its extremely profitable if you have identified it as a pump and dump.
Mustafa Ali (3 years ago)
Thanks, you had enlighten me! I keep that in mind
Mustafa Ali (3 years ago)
Thanks for the comment. Yes, I can't agree more. The only thing that puzzles me on him, is that, why now he more concentrate more on teaching people when he can make more money by trading? He must be tired, I presumed and try to cash in on teaching instead. I stick to your methods and guidelines, its the best so far I even come across!

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