Day Trading Penny Stocks?
I was just given a small amount to play around with penny stocks. I know this is a win-or-lose-everything kind of deal, so for curiosities sake, I’m starting small.
The thing is, I have no idea what kind of research to do for penny stocks. They are all so volatile that there doesn’t seem to be much in the way of analysis. Am I wrong? Is it just blind luck throwing a dart at a board of stocks, buying several thousand shares, then selling the second it jumps?
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As a CFA, I would recommend to steer clear of penny stocks. Research is hard to come by, and tends to be very biased (i.e. people “pumping” stocks they own , so they can later sell them). If you had some “inside” (legal, of course) knowledge, or knew the company then I could see buying some shares, otherwise, might as well play the casino. Seriously.
Day trading penny stocks (or any stocks) requirers a good working knowledge of;
Techincal Analysis
Money Management Techniques
Trader Psycholgy (yours and the markets)
“Research” does very little if you’re trading time frame is a few days to a few minutes.
A penny stock is any stock priced at $5 or less. It’s usually a good idea to have 5 or more years of trading larger cap stocks (successfully) before doing penny stocks.
Swing Trading may be a better way to start.
Here’s a couple of web sites (with videos every day) that can help you get an understanding on technical analysis;http://www.alphatrends.net/http://www.tradingwithtk.com/
On Sundays (early evening) watch;http://www.redoption.com/shadow_video_ar…
Day Trading Or Swing Trading takes a lot of hard work to be successful. Very few people are successful year after year. But…. there are those that do!
ya@ErieStockTrader.com
check this out http://tradestockonline.blogspot.com