<p>Anyone here trade them?</p>
<p>penny stocks are less for trading than for holding on to</p>
<p>is there some online stock market sim that you start out with like 5 grand and compete against othere people?</p>
<p><a href="http://www.investopedia.com%5B/url%5D">www.investopedia.com</a> is the best if you want to learn stocks.</p>
<p>Despite trading real cash, I still use it to test my methods.</p>
<p>Penny stocks is like betting without knowing the odds. Stick to micro, small and mid caps.
Trade futures or Forex. Better than trading pennies. There is a reason why they are pennies.</p>
<p>Yea, but I like to go short, and I don't have enough cash, to trade on margin. So it's not like I can buy lucent, then it goes up 3cents and sell. Then do that like 100 times in a day. So pennies yield high return, esp with the current level of funds I have.</p>
<p>Try FX. Mini accounts start at 250 bucks someplace but I suggest starting with at least 500 and optimal would be 1000 or so. </p>
<p>And I never day traded stocks. Not the best way to blow up my funds ;). Day trade FX quantitatively though (max hold time for one strat: 3-5 days, volatility trader: 5 minutes-3 hours)....all about the balance.</p>
<p>What does Haithman think?</p>
<p>Haitham would of course agree ;).</p>
<p>He is currently getting lectured about why he should become a peon by Goldman Sachs. Oh well.</p>
<p>This thread is disgusting. If you want to play dangerous with penny stocks who are backed by meager, inexperienced companies--that's not investing; that's speculation.</p>
<p>You are wrong. That is black box style gambling. Speculation is not a BAD thing. Heck look at Kovner, Tudor Jones and Soros. Those guys are speculators. A speculator seeks profits to attain the highest absolute returns possible. There is no definitive answer between investing and speculation and what they mean. </p>
<p>So you are saying that investing has no risks what so ever and have a 100% chance of succeeding? Investing IS speculation. There is no difference. Buffet "invests". His "investment" in the US dollar has become very bad with the dollar sitting at multiyear highs.
Soros (at the same time as Buffet) "speculates". His "speculation" that the US dollar will lose value has gone bad with the dollar sitting at multiyear highs. </p>
<p>Difference in the senario=none. </p>
<p>Penny stocks are not traded by speculators. They are traded by gamblers who lack insight into the art of proper investment decision.</p>
<p>Btw Buffet like Soros managed a hedge fund early in his career. I see no difference. An investor is a speculator.</p>
<p>If you knew at all what you were talking about mahras you wouldn't use BUFFET, who was taught by the father of value investing, to corroborate your faulty claim that there is no financial distinction between "investing" and "speculating". If you want to know what INVESTING is about, read:</p>
<p>a) Any Berkshire Hathaway Annual Report</p>
<p>b) Security Analysis / Intelligent Investor</p>
<p>c) Any book by Phillip Fischer</p>
<p>Then, come back and tell me "penny stock playing" is "investing". Investing, as the sources above will clearly indicate, entails the commitment of economic resources in return for a PREDICTABLE cash flow over time, whereas "speculation" is merely centered on making a profit through short-term price fluctuations and usually involves VERY LITTLE TO NONE of an emphasis on company productivity, management, earnings, or any other sane indicator of financial security.</p>
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<p>WHERE did I say penny stocks is investing? If you knew anything about READING you would have seen i condoned it. As for reading about value investing: the father was Benjamin Graham....I have read his books 3 years ago. I have read every one of Berkshire Hathaway's reports compiled in a book that sits beside me on my bookshelf and I have also read The Buffet way. Thank you very much but I believe I know much about value investing. I also have in the past held Berkshire hathaway "B class" shares as well as having attended the annual meeting in Omaha, Nebraska in 2003.</p>
<p>I suggest you re read what I wrote about penny stocks. I have never traded pennies. Traded stocks for 3.5 years before getting into quantitative currency trading which I do now. Its important to read carefully before attacking someone's knowledge. Basic courtesy.</p>
<p>And no what you are describing is high frequency trading. I suggest you read about Jim Simmons. Also a dictionary may be helpful in understanding what the word SPECULATION means.</p>
<p>
[quote]
An investor is a speculator.
[/quote]
</p>
<p>My point is that speculation gambling and is nothing close to investing, unlike what you said above. I used penny stock "investing" as a backing, which seems to be what this thread is all about.</p>
<p>BTW, I wish I had some shares of BRKb. =/</p>
<p>And my point was that speculation is NOT gambling. Speculation is the use of making a risk calculated stance backed by conviction over an issue which you are willing to put your money into to reap absolute returns. </p>
<p>And no I said "black box" gambling as it can be argued gambling can be risk calculated. Investing is the use of measuring risk: rewards exactly like speculation, to form conviction EXACTLY like speculation, and to put your money where your mouth is to make profits again EXACTLY like speculation.</p>
<p>When you say "predicting" cash flow you are speculating that the cash flow will reach your prediction. </p>
<p>Anything that is not certain can be classfied as speculation. </p>
<p>If you notice I didnt start the thread and I was one of the first people to condone trading penny stocks.</p>
<p>Heh I am glad I let go of mine. As much as I like long term methods I dont like the idea of having a disproportionate amount of my trading stake stuck in one stock. Also that dollar play is costing Buffet quite a bit.</p>
<p>You cannot mesh speculation and investing into the same pot. There has to be a discrete difference; there is a discrete difference. This difference was assimulated by me when I read books on value investing (essentially books that DEVOTED themselves to defining the difference between investment and speculation). I think you're trying to get very literal with your argumentation/definitions which do nothing but produce tautologies. There IS a difference as far as I, or any other respectable financial author I've read, is concerned. </p>
<p>PS - What grade are you in and where do you get your money to have shares of BRKb at such an early age. I could barely afford coca-cola last summer with my paltry grocery store paycheck and am still submerged in the "monopoly money" investing world of the theoretical (aka, my room computer).</p>
<p>mahras wins game over.</p>
<p>Isn't it spelled Buffett?</p>
<p>Penny stocks can fluctuate maybe ...a penny during the course of a month? By penny stocks you mean stocks under a buck right?:|</p>
<p>Now first thing I need to make a point about. You seem to feel value oriented picking is the only form of investment management worthy of being called an "investment". Those books you read are just one category. There is growth companies, GARP and a whole slew of em. Now the question with speculation is the current idea among these financial "gurus" that "investment" is safe and "speculation" is risky. Yes I am getting literal because current media almost makes speculation being potrayed as a crime. Speculation is the art of risk calculation to reap rewards. An investment is the art of risk calculation to reap rewards. Both of these are the same. I want to point this out to the general crowd as this is a key factor and such false ideas should not spread. And I have probably read some respectable names myself. There is no difference between a speculator or an investor. I shall stand by this. When you "invest" in a company to reap rewards you are undoubtedly "speculating" that the company's stock price will increase due to business profitability, market sentiment, prevailing/underlying trend etc. </p>
<p>As for where I got my money from....I started trading equities and eventually did some options plays when I was 12.5 years old (16 going into 17 in a few months now). And then got into leveraged FX trading a couple of months back. That lil stake has grown pretty considerably over this time. I am in 10th grade (into 11th).</p>
<p>iwantfood>Yes it is buffett ;). Penny's fluctuate but the buyers and sellers are so small that any little demand results in a high pop followed by a bust. Vice versa when suppy exceeds. Also penny's arent transparent and the company's operations cant be found.</p>
<p>Bern>Thanks. :)</p>
<p>Now lets move on to the idea of penny stocks. to the OP> it aint worth it.</p>