Trading Microcap Penny Stocks Part 2
Written by admin on September 30th, 201013. The Know-Your-Anthropology Axiom Comprehend the nature of man! For this axiom, you have to be somewhat of a Christian theologian. The Bible clearly teaches us that mankind isn’t naturally great…he is normally evil (Psalm 14 is really a good place to begin). The word Christian theologians use to describe our condition is “depravity.” Mainly because of the fall of man, we are morally corrupt in every part of our being and tend toward wickedness (i.e. greed, theft, lying). We stand in have to have of redemption from a Savior. So comprehend that you’re playing amongst men and women (including yourself) that are not naturally excellent…they’re effortlessly bad. In other words, you’re playing with fire. Lies, half-truths, and misrepresentations abound inside the OTC world. You much better take EVERYTHING with a grain-of-salt the size of Texas. Some posters need a lot more salt than others to digest. Be an evaluator of individuals. Learn how to ask the right questions. Make certain your yellow flags and red flags are Usually working.
14. The Early-To-The-Party Axiom Be willing to buy lower what you bought higher. I have often arrived to a party early. By “party” I mean a gathering of people and people’s money that will result in a stock’s PPS going much higher. Not even Equity Feed or other trading software volume alerts will prevent this. When the promotion isn’t ready, you are early. By “early” I mean I got there prior to the stock was sitting at a low. I am always somewhat discouraged when a buy I made continues to go down. But if I have done solid due diligence in the organization, I frequently take it as an opportunity to add far more shares less expensive and lower my typical. In other words, do not look at your initial investment as dead funds and hope that it goes back up again so you can get out. Average down, do the due, and then promote your stock to others and support jumpstart the party. Be a spark plug.
15. The Next! Axiom Be looking to obtain out of an issue the moment you get in. Have an exit strategy in place. By buying a stock you might be not entering into any kind of formal arrangement like matrimony. You might be an investor and as such your goal would be to make money. If your investment should go up within the very first 20-30 minutes of buy why is it any diverse taking some profit then as if it took 20-30 days for it to go up? Get in. Lock in profits. Ride freebies.
16. The Grow-Up Axiom Somebody the moment said: “If somebody screws you the moment, shame on them. But if somebody screws you twice, shame on you.” In the OTC world I would modify it a bit to say: “If somebody screws you as soon as, shame on you. If somebody screws you twice, you truly are a moron.” Take responsibility for ALL your investment decisions. Nearly nothing ever happens as planned or hoped here on the OTC. There are too a lot of enemies against making a stock’s PPS go up. If you’re going to play the game down here…you much better be ready to accept FULL and COMPLETE responsibility for EVERYTHING YOU DO IN THIS INVESTING REALM. Point the finger of blame at only one place: yourself.
17. The Ask-Yourself-Why Axiom Understand that many of the persons encouraging you to buy an issue are compensated promoters whether they disclaim it or not. Most times they don’t have your best interest in mind, they have their very best interest in mind cause they’re sitting on a mountain of stock and can’t wait to turn paper into cash. It has been said that “the man that will answer the question ‘what’ will often have a job but the man that can answer the question ‘why’ will constantly be his boss.” Be continually evaluating EVERYTHING by asking questions that begin with “WHY.”
18. The What-Was-That-Again? Axiom Comprehend you happen to be nearly NEVER getting the whole story. The only way optimists will survive inside the OTC is if they become compensated promoters. Pessimists can either come to be paid bashers or fast flippers. The OTC calls for realism. Be a realist. To be a true OTC realist you need to know and realize all that you’re up against to make a stock’s PPS go up.
19. The Public-Versus-Private Posts Axiom Many of the men and women pumping stocks are stuck in them and desire to inspire a whole new wave of bagholders to come take their place. Usually times what is being said on the public message boards is entirely distinct than what those same posters are saying behind closed doors. Realize this. Digest this. Embrace this. Don’t be naive.
20. The Buy-The-Story-Not-The-Company Axiom So you bought a stock mainly because of the solid PR that came out. Cool. Why did you obtain? Mainly because from the story. Do you definitely know anything else about the firm? Is it real? Do they’ve a big building? Do they have equipment? Are they producing? Forget all that. In a lot of techniques it’s irrelevant. In the event you are going to invest from the OTC you had far better learn to invest in STORIES. Now, ironically, one of the dictionary definitions for “story” is “a lie or fabrication.” Do you really consider that you’re investing within the same caliber of companies about the OTC as you would around the NASDAQ or NYSE? Do not be naive! Do you feel what your organization outlined in that lovely PR is really going to happen? Two words for you my friend: SAFE HARBOR. Inside the OTC that you are investing in Potential ALONE; therefore, be a discerner in the Capability OF THAT COMPANY’S STORY. What has fantastic possible? Water to China? American Idol in a 3-D world? Gasoline replacement in a weed? Oh yeah baby! All those STORIES have wonderful Prospective. But there’s a monster “IF” involved in every single one of those. After some time, the reality that the “IF” is gonna stay a large “IF” sinks in and also the stock PPS encounters a slow death. Sadly, some on the definitely true OTC firms go unnoticed simply because they usually do not have a fantastic story with possible. The term numerous investors use to refer to the story is “kool aid.” Does your stock have excellent “kool aid?” Well, does the potential of your corporation make you wish to obtain it? Does it make other wish to obtain it? I try to avoid investing in Penny Stocks Alert that don’t have great kool aid flowage or the possible for great kool aid flowage. Wow. What a concept. About the OTC sometimes you’ve to invest inside the Possible Potential of the firm. (That last sentence wasn’t a misprint. Read it twice when you must.)
21. The Don’t-Gamble-Away-The-Mortgage Axiom You *should* expect to lose your entire investment. You *should* expect to shed a lot more dollars than you make playing OTC issues until you wise up, learn these axioms, and behave according to them. If you’re playing the OTC to try and make some quick income to pay off a debt, great luck with that. Unless you might be an experienced OTC Jedi Master that does this for a living (and I’m by no means saying that I am one or that I have arrived!), you better ONLY USE Funds You’ll be able to AFFORD TO Lose.
22. The Dingleberry Axiom This is the term I save for bidwhackers. Recognize that the OTC market is sadly full of individuals that do not comprehend the concept of selling at the provide. They’re more than happy to whack out the bids on an issue for their lunch money. Understand that generally the longer an concern stays within the spotlight, the far more trouble it is gonna have with dingleberries, er, whackers.
23. The Bid And Offer Axiom Degree 2 is typically the truest of truths in the OTC. It tells a extremely accurate story. In the event you cannot afford to devote your day glued to L2 watching the issues you’re trading…you shouldn’t expect winning trades on the OTC. I basically can not stress sufficient the importance of having LIVE Degree 2 and understanding it. Devote some time paper trading which watching L2s. Practice. Practice. Learn. You just gotta understand what the Degree 2s are telling you. Some of my friends would also come in here at this point and say it truly is not only L2 it’s also the chart. I would argue that it is Much more L2 and LESS the chart. By understanding and watching L2 I feel like I can identify dilution much quicker than by basically looking at a chart and all its indicators.
24. The CEO Is A Scumbag Axiom Now I know we’re all quick to defend our favorite CEO…but the truth is he or she is often a scumbag. Now what level of scumbag she or he is I cannot say…but with confidence I can say that each OTC CEO is often a scumbag. Deal with it.
25. The Know Your Friends And Enemies Axiom You’ll have a hard time succeeding down here without pals. Any amount of public success will bring you more friends and new enemies. Understand which is which. Keep your nose clean. Loose lips sink ships. Know when its time to sever a relationship. Know when its time to repair a relationship. Know your associates.