Don't Be A Victim Of Penny Stocks Fraud

by drorklar

Use the following tips to protect yourself

Penny stocks are made available at a very cheap price, usually below $5 for each share. This is the main reason why a lot of people are into trading penny stocks through Pink Sheets or Over the Counter Bulletin Board (OTCBB). But this main reason which draws people to buy and sell penny stocks also has its downside. Because of this, nonexistent companies are created to scam people.

It also does not help that to be listed in Pink Sheets, a company is only required to have a broker who will quote its share prices. They are not required to furnish copies of documents evidencing their authenticity. The potential investor will not have any access to the important information needed to make sound investment decisions because of this. Therefore, the investor must educate himself very well and research about the company.

Many people have already lost millions of dollars in penny stock trading because of one main reason: they are not vigilant and cautious enough to see the warning signs that a company might be fraudulent.

In order to keep yourself abreast with quality information, you can seek the different mediums of stock information which are: your broker, investment newsletters and manuals and trade confirmations. Before you can trade penny stocks over Pink Sheets, you must enlist the services of a stockbroker who will carry out the transaction for you.

Stockbrokers are usually the best source of stock market information because they deal with it every day. If some things are unclear to you, you can contact your broker and have it explained to you. Investment newsletters are the best source for breaking news and updated information about stocks, while manuals like Moody's and Standard and Poor are a source of comprehensive penny stock information.

Lastly, trade confirmations are usually furnished by the broker to the investor. This document will state basic information such as the number of shares purchased, background information and the ask and bid price during the time of transaction.

While the best defense that you can put up against penny stocks fraud is to be well-informed, it will also help if you know the different warning signs so that you can determine if it is fraudulent in nature. Some of the warning signs that you need to look at are: high pressure sales techniques, error-filled trade confirmations and unauthorized transactions.

High pressure sales techniques are usually employed by small companies who want the cash fast and need it bad. They will not stop at anything for you to invest in their company. You must not give in to techniques like this; there is always a catch.

If you see that your trade confirmations have errors or are mismarked, it is better to clarify it with your broker. Study the trade confirmation once you receive it, and make sure everything is correct. If you find errors, bring it up with your stockbroker and have it corrected immediately.

Even if you have a broker who will do all your transactions for you, it is always better to be on top of things. Know all your transactions and keep an eye out for transactions that you did not authorize. It may be a simple mistake on your broker's part, but it can also be something that will constitute penny stocks fraud.

About the Author

Nir Dotan is a writer and promoter of

Penny Stocks

services, and

Penny Stocks Preferred source for the latest news and information on the best and brightest Small Cap Stocks.

Article Source: Content for Reprint

How To Use Online Stock Trading For Your Success

by Mark Crisp

Many investors will tell you that trading in stocks might be the good old-fashioned way of investing, but it works. Regardless of the ups and downs, and there are many on the rollercoaster that is stocks; stocks are an exciting game that has a place for anyone. In the age of the information superhighway there is a whole world of varied stocks that you can build wealth with. You might only make enough money to use in your next investment but with online stocks the door is truly open.

Online stocks are a huge market. You can start online with cheaper penny type stocks and you can even purchase some of the high-end stocks for a couple of hundred dollars a share. Like most online shopping, most of the stocks that are for sale online are available in the real world market, but they cost more. Because of the lack of human contact and advice given, buying online stocks gives you the opportunity to get into the game without the high fees of your average broker. The online trader is also completely in control or his or her stocks.

Trading online does mean that you will have to be familiar with certain terminology. To do so we have compiled a list of some select of the most common available online stocks and their meanings. We suggest you take these means and do some more research. Let’s look over what kind of stocks can be brought and purchased online and in the real life stock market.

Penny Stocks: While not all ‘penny stocks’ actually cost a penny, they are the cheaper stocks on the market and are considered cheap and dirty by some. Others however have made large profits by trading in penny stocks, because once the price raises you can sell the many stocks you have purchased and make a return. Penny stocks are normally available for upstart or new companies who want to offer their stocks at cheaper prices to get them off the floor. Trading in penny stocks is a common form of online trading.

Blue Chips: Like their name suggests blue chips are premium stocks. Blue chips are the stocks of companies whose names you hear every day. So if you look at the steel that your fence is made from or the airline you fly with, you will probably find that their shares are blue chips. Because of the ‘assurance’ that blue chips will continue to grow, they generally cost a fair bit and are amongst the highest priced stocks. Blue chips are known for being strong and either maintaining their price or slowly growing over time. Blue chips also have the added value of climbing rather rapidly after a fall or at least recovering quickly.

Bonds & Futures: Bonds include municipal offers and can be issued by the companies. Futures however normally relate to farming crops, so if the oranges crop is doing well the orange futures will also do well. Futures also include wheat, livestock and other farming products.

If you really search you can buy almost any kind of stock online, all it takes is someone willing to sell them. The availability will depend on which website you are using and what they have access to.

Like any form of stock trading, just because you can now buy and sell your stocks online, that doesn’t mean that you should forget all about being careful and doing your research.

About the Author

Mark Crisp is the Weekly Momentum Stock TraderrGet your free momentum stock trading course at:rhttp://www.stressfreetrading.comr

Article Source: Content for Reprint

Financial Abundance Trading Penny Stocks

by tropicalabundance

How do you define what is a penny stock? There is no official definition. Some say any stock under two dollars, some say under five dollars.

I call a penny stock any stock that trades under one dollar. Most of the stocks I trade are under .05 and I trade a lot of sub-penny stocks. A sub-penny stock is any stock that trades under one penny. (.001-.01) A sub-sub penny stock or super sub are those stocks trading in the .0001-.0009 range or hundredth of one penny.

There are different markets that penny stocks trade on. The OTC Bulletin (OTC-BB), over the counter (OTC) and pink sheets markets here in the USA. In Canada there is the TSE and TSE Venture Exchanges. Also there is the NASDAQ small Cap Market. All the shares on this exchange are one dollar and up so are not penny stocks by my definition. Also there is the American Stock Exchange (AMEX) .The NASDAQ and AMEX are the safest with reporting requirements that enables investors to have access to the companies financial filings.

Pink Sheets are the most risky with no reporting requirements. Sometimes they even gag the transfer agent so you can't even find out the share structure, (bad sign). Yet these risky, pink sheet stocks give you incredible leverage. Most if not all of the super subs are pink sheets. The super subs give you the most bang for your buck. I look at it this way, the leverage you get with the super subs makes up for them being more risky.I would not call it investing with pink sheets, actually it is speculation.

With short term penny stock trading, it's all timing. You can make money buying the worst companies at the right time and money can be lost buying even the best companies at the wrong time. Actually I need to say buying and SELLING at the right time will make you money. I've heard it said that 80% of a successful trade is in selling at the right time.

Why trade penny stocks: penny stocks can make you very wealthy in one to three years if you learn how the game is played. You may have heard investing in penny stocks is risky. It is very risky, specially if you don't know what you are doing. High risk/high reward. Do not trade with money that will destroy you if you loose it. So why do it if it is risky?

The number one reason is leverage.It is simple math. Because the price is so low you can buy millions, hundreds of millions, even billions of shares. At the lowest price of .0001 you can buy a million shares for $100.00 and hundred million shares for $10,000.00.If the price goes to one penny you have made one hundred times your money. Your $100.00 is now $10,000.00 and your $10,000.00 is now $1,000.000.00. Yes now you have one million dollars. Does this happen? Yes it does!

Huge moves like that don't happen every day. When a stock goes up to ten times your money it is called a ten bagger, five times a five bagger. Ten thousand dollars put into a ten bagger is one hundred thousand dollars put that into another ten bagger and you have a million dollars. you would still have a million even starting with a thousand dollars if you had three ten baggers in a row instead of two in the previous example

This is not to say you can't loose money. You can! These are just examples to open your mind to the power of super leverage. The beauty of trading penny stocks is you can work from home or from anywhere that has a internet connection. All you need is a computer( I use a laptop), a internet connection, a on-line broker and some money to start. How much do you need to start? It depends on your situation. Don't risk more than you are willing to loose. Start out small until you have gained some experience.

The people that I see that make the really big money in penny stocks have a considerable amount of money that they are trading with. The old saying, "it takes money to make money" is true. It is all about liquidity. These stocks are so volatile the only way to play them is trade them. When you start with a small amount of money in your trading account, it is very easy to get wiped out to nothing. It's happened to me more times then I want to admit.

After getting wiped out but seeing that penny stocks have the very real potential of making millions I started looking for a way to generate a large amount of money to trade with. I found an online marketing business that I am using to create the trading capital I need. It is a perfect complement to trading penny stocks as it gives me the liquidity I need to trade penny stocks.

About the Author

Jeff Goodman is a Coach for Abundant Wealth. He lives in Hawaii by a waterfall. Find out how to create a six figure income with an automated online business where trained professionals close your sales for you. You earn $1000 per sale to infinity.

Article Source: Content for Reprint

Stocks Online Are Quite Varied

by Samantha Davis

Anyone who decides to get into stock trading will soon find out this can be a world of ups and downs. Still, many investors find trading stocks is one of the best ways to accumulate and build on wealth. Even if it's only a few dollars at hand to invest, stocks online can be a great consideration. Buying and selling online delivers not only a lot of perks in regard to ease, but also variety.

Stocks online now available for purchase come in all types. They can range from a few pennies to those that cost hundreds per share. For the most part, investors will find that stocks online are those that can also be purchased through a broker, paying higher fees. The advantages to online trading include not only lower fees, but also control and access to more markets in many cases.

The types of stocks online for purchase tend to include:

Penny stocks: These stocks are considered "junk" by some, but the fact is some people have managed to make very big returns on cheaper buys. Start up companies and those new to the stock market often offer their stocks at very affordable prices. While they might not actually cost a penny, these lower priced stocks are worth researching for investors without a lot of means. These are common buys online.

Blue chips: Some of America's biggest company names fall into the blue chip category. These stocks online tend to be more expensive than others, but they are typically noted for their ability to maintain or increase price. The theory behind the blue chip stocks is that if they fall, they will generally recover their value and even increase it.

Bonds, futures: It is sometimes possible to buy into bonds and futures online, as well. These are also available for public trade and inasmuch can be great investments. Bonds can include municipal offerings and even those issued by companies. Futures tend to revolve around crops, such as oranges, wheat, livestock and so on.

In reality, those who look for stocks online will find almost everything available on the domestic front can be hand online, as well. The availability of some markets will depend on the site being used. Some traders will only offer specific markets they have access to.

Another option for online traders falls into the realm of foreign markets. Forex trading has become a very big deal with the Internet making it easier and easier for people to invest in foreign stock markets. Getting into foreign markets successfully will likely require some very serious homework on potential buys and pitfalls. The offerings on the foreign market will depend on the sites being used to invest.

No matter how stocks online are bought and sold, it's a good idea to enter the deals with care. Do some homework on the sites being used to buy and sell, study the potential stock buys and do pay attention to major trends up or down. Even investors with a very little bit of money can make some real returns when they play the game well.

About the Author

For more online stocks information please visit http://www.aboutonlinestocks.com - a popular online stocks website that provides tips and online stock resources. Don't forget to check out our page on stocks online.

Article Source: Content for Reprint

Finding, Buying, And Selling Stocks Online

by Samantha Kay

The history of the American stock market had its beginnings in the late 1700s during the fledgling years of the country. In Philadelphia, founding citizens of this new world instituted a stock exchange wherein currency could be exchanged in order to support business and stimulate this new economy.

This initial exchange gave way to a group of merchants who banned together to form the New York Stock Exchange. This initial assembly of men met every day on Wall Street to trade their stocks and bonds – an outdoor ritual that lasted through to the early 1900s, when commerce moved indoors. Today, investment on this scale has come full circle – operating outside the bricks and mortar of traditional trading. Today's investors operate en masse through the Internet, buying and selling stocks online with the click of a mouse.

Buying and selling stocks online has become the new way of investing. In this chaotic world of long work hours combined with the juggling of frenzied family schedules, the computer has taken an ever-increasing role – giving us a place to work, communicate, and be entertained any time of day from the comfort of our homes. The computer has also taken an ever-increasing role in investing, offering consumers the opportunity to trade online. Several reputable companies have pioneered the online investment arena where they have kept pace with the changing needs of today’s modern investors.

In accessing stocks online, investors have been given access to a bevy of services previously only obtained through visiting brokers in the brick and mortar world of finance. Online investment through reputable brokerage companies requires investors to set up an account through the website. They can then access their financial portfolio at the touch of a mouse. Additionally, these companies will offer up-to-the-minute stock quotes, historical performance and forecasts for each stock, as well as in-depth information about each of the companies.

Investors report that the ability to trade stocks online offers many benefits not provided through traditional brokering. First and foremost, online investment offers lower brokerage fees than required through traditional brokerage houses. Through online trading, investors typically pay $10 and under per trade. Online trading also affords investors a level of independence and control not previously experienced through traditional trading. Investors can pick and choose stocks online that meet their own personal financial goals.

Using the tools provided through the brokerage websites, investors can research those companies and stock in which they are interested. Further, investors can access their portfolio to keep careful track of their financial status as they move towards the goals they have set out for themselves.

Part of what keeps the financial world moving at a pace that continues to stimulate economy and promote business is its ability to adjust to changing conditions in society. Online trading is simply a response to what is happening in the world of finance on a grander scale. The ability to buy and sell stocks online meets investors where they are in today’s world and gives them the opportunity to take a greater role in their own financial future.

About the Author

For more online stocks information please visit http://www.aboutonlinestocks.com - a popular online stocks website that provides tips and online stock resources. Don't forget to check out our page on stocks online.

Article Source: Content for Reprint

5 Tips To Make Money In Trading Stocks Online

by J. Lloyd

The discovery of internet has made the methods of doing businesses very easy and comfortable. It has also taken the market of stock to the heights as the large percentage of population has opted the method of trading stock online.

Tools To Start Trading Stocks Online

The method of trading stock online has been proved as the most convenient and successful method of trading stock. It is also very easy for anyone to start trading stock online by just possessing 3 important tools which are:

1 - Computer: If the whole procedure of trading has to be done online, then it is obvious that the main foundation of this trade is the computer. If anyone wants to start with online stock trading then he should possess a fast computer with Windows XP as its operating system.

2 - Internet: It is the major component of online trading as it will connect you to the various companies of the stock market. It is always suggested to go for a high speed cabloe or broadband internet connection.

It is always recommended to have an internet back up even if you possess a good net connection as there are the chances for the net to get down. You should always possess an access to a telephone line if, in any case, your system gets disrupted and you want to exit the trade then by using telephone you can inform the broker regarding the same.

3 - Brokers: In order to enjoy the excitement of trading stock online, one has to require a broker through whom you will be involved in online trading. There are many online brokerage firms possessing different fees and offering different services. You should always opt for the online broker that proffers good stock trading and charting software. You should always select that online brokerage firm which offers market data and the updated information to all its clients.

Before going to have the tools for online stock trading, you should jot down the things which will be required by you from each and every tool.

Tips To Make Money In Trading Stocks Online

There are many people who have been successful in making out huge amounts from the online stock trading. The following 5 tips will really help the online traders to make out dollars from online stock trading.

1 - Chart reading in stock trading is the most beneficial step for the traders to trade efficiently. By becoming skillful in the activity of reading charts, you can easily judge out the stocks that will move up.

2 - It should be habitual to set stop loss orders whenever you make trade else your entire account will get smashed. You should always proceed in the game by scraping down your losers early and by allowing the winner to continue. Basically, this is one of the tactics of the trade.

3 - You should never purchase the stock which is dropping down with a perception that it will increase suddenly after you will purchase it. You should always opt for the stock that is constantly moving up and will keep on touching the heights. Therefore, you should get rid of a myth "buy low and sell high" from your mind.

4 - You should never give an importance to the media personalities rather it is recommended to work independently while trading online. This is so because there are frequent ups and downs in the stock market and by the time information of the media persons reaches you, it becomes too late. Therefore, it is always recommended that you should always work with your brain instead of trading by using someone else’s brain.

5 - You should always search for the brokers whose commission share should be low else your profits will be spent in paying the commission to the brokers.

These five tips will really help everyone to hitting the jackpot while trading stock online.

About the Author

For more online stocks information please visit http://www.aboutonlinestocks.com - a popular online stocks website that provides tips and online stock resources. Don't forget to check out our page on trading stocks online.

Article Source: Content for Reprint

Is Buying Stocks Only For Winners?

by wsmith8

When you tell people that you're about to start buying stocks, you're likely to encounter some latent hostility.

Most people wish that they too were buying stocks, but they're afraid to get started or ashamed that they don't understand the markets.

Therefore, they try to discourage others from purchasing stocks - it's the crabs in a bucket parable come to life. Often, these naysayers will dispense popular (but untrue) myths about buying stocks. In this article, those myths are dispelled, one-by-one.

#1 - Buying Stocks is Only for Rich People

Sadly, there was a time when this was mostly true. Way back when, the commission charged for purchasing stocks was more than $100. Thanks to discount stock brokers like Charles Schwab and the advent of the internet, buying stocks has never been less expensive.

For one, technology has reduced the spread between the bid and ask prices. This means that the prices you see scrolling across the TV screen are very close to the prices you will pay when purchasing stocks - off by only a few cents or so.

Secondly, commissions are way down. Buying stocks now costs as little as $7 per trade through online brokers like FirstTrade and ScottTrade. Purchasing stocks through E-Trade and Ameritrade costs less than $10.

But if you're really on a budget, you should be buying stocks through Sharebuilder, which allows you to pool your money with other investors, and add fractional shares to your account for as little as $1 per investment!

#2 - You Need a Broker to Begin Buying Stocks

For this myth, the naysayers exploit the popular understanding of what a "broker" is. Yes, you do need a broker in order to begin purchasing stocks.

But if you think a stock broker is a grey-bearded know-it-all that you pay to make you feel bad about yourself , then you're in for good news, because you don't need one! The type of broker that you need isn't a human being at all - Ameritrade is a broker, for example.

All you need to begin buying stocks is an account with an online broker. Don't listen to the naysayers or the Edward Jones commercials - you can do this on your own!

#3 - Buying Stocks is for Suckers

This is one of the pettiest, most inaccurate myths of all, but in the wake of Enron and other Wall Street scandals, it's also one of the most pervasive. It's based on the absurd notion that stocks are nothing more than pieces of paper.

Stocks are not just pieces of paper. They represent actual ownership in a real, live business. When you own stock, you own a fractional share of every penny that the company earns and every dollar that's in its bank account.

You even own its property, plant, and equipment! Of course, you are just one of many owners, and your share is undoubtedly very small - but you are an owner, and this does matter.

Even if the stock falls on hard times, a bigger company might come in and buy the company in full - usually at a healthy premium. When they buy the company, who do they buy it from? From you, and all the other shareholders like you.

The Truth - Purchasing Stocks is Inexpensive, Easy, and It's for Winners

Don't listen to the naysayers. You know that buying stocks is in your best interests, and you've probably been putting it off for far too long already. Give yourself a basic education by reviewing articles at informative websites like this one, and then get out there and start purchasing stocks.

After all, there's no better education than the one you'll receive when your real money is on the line.

About the Author

William Smith the author provides additional financial information on many subjects as well as the secret to his success in the market along with 5 Free power stock picks emailed daily so grab your Free subscription on his website at Stocks (All is Free)

Article Source: Content for Reprint

Market Makers And OTC Stocks

by drorklar

A person who would like to purchase, or sell, or otherwise trade in securities known as over the counter (OTC) Stocks could look for such stocks at the Over the Counter Bulletin Board, also known as the OTCBB.

The OTCBB is a regulated electronic quotation service that displays quotes, sale prices, and volume of sale information of OTC Stocks. The OTC Stocks include warrants, US-company issued stocks, and shares of foreign company stocks.

The OTCBB has over 5,000 companies that have OTC stocks quoted in its electronic quotation service. These different OTC stocks are dealt with by the Market Makers. There are currently over 400 Market Makers in the OTCBB.

The OTCBB is a regulated electronic quotation for securities and company stocks that are sold over the counter, and not a stock exchange. Among the important differences between stock exchanges and the OTCBB is the way stocks and securities are traded. Stock exchanges have automated trade executions on matching buying/selling prices, while at the OTC stocks market, a Market Maker may choose not to buy or trade stocks that they deal with.

These market Makers are the dealers that function much like Securities Specialists in the stock exchanges. They compete to buy and sell the shares that are traded in the OTCBB. They set their own bid prices and ask prices for the OTC stocks traded on the market.

The market makers make their profit from the spread between the bid price and ask price of the OTC stocks that they are dealing with. Competition between market makers places a limit on the spread or profit that they can make from a particular OTC stock. The market maker with the best deal for a particular OTC stock will be the one that investors would choose to do a transaction with.

Let us explore an example of how such an OTC stock trade works, with two market makers, both dealing with a an OTC stock XYZ, a stock that trades at $0.52 at the end of the previous trading day. Let us assume that the market makers both have the same volume of XYZ stock at the start of the current trading day.

Market Maker A sets his bid for OTC stock XYZ at $0.50 and his ask at $0.55. This means he will buy XYZ stocks from investors at $0.50 and sell the same stock for $0.55. His spread is $0.05.

Market Maker B is another market maker that deals with OTC stock XYZ, and decides that his bid for the stock is $0.51 and asks $0.55. That makes Market Maker's Bs spread to be $0.04.

Between Market Maker A and Market Maker B, investors will most likely sell their OTC stock XYZ to Market Maker B. Investors will buy XYZ OTC stocks from either Market Maker A and B, since they sell at the same price. Eventually, Market Maker B can have more XYZ stocks on hand than Market Maker A, and Market Maker B can profit from more sales volume than Market Maker A.

Other Market Makers can choose to trade in the XYZ OTC stock that Market Makers A and B have been competing in, and set their bid and ask prices according to their discretion. Market Maker C can join the fray at any time, and expecting that the XYZ OTC stock would rise in value, he sets a bid price of $0.53 and ask price of $0.56.

The OTC stock quotes made by these Market Makers are all shown at the OTCBB in real time, as well as any transactions that are made for each OTC stock last sale price and volume traded included.

About the Author

Nir Dotan is a writer and promoter of

OTC Stocks

services, and

OTC Stocks Preferred source for the latest news and information on the best and brightest Small Cap Stocks and all Over The Counter Stocks.

Article Source: Content for Reprint