posted
Hello, I'm very interested in penny stocks but I have very little practice with the stock market. What would you guys recommend as far as reading and how to go about investing? Another thing, who would you recommend for an online broker (someone recommended me zecco.com)?
I hope this is the correct board for this. Thanks everyone that helps me out, I feel lost.
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There is a board called General investing topics for newbies...search over there...and here is a bunch of stuff...Have fun..and good luck!
Some simple and Basic questions:
What do these letters mean? DD=due diligence (Research) MM=Market Maker (definition http://www.sec.gov/answers/mktmaker.htm ) EOD=End Of Day EOW=End Of Week HOD=High of Day PPS=Price Per Share O/S=Outstanding Shares POS=Piece of "Poo Poo" IMHO=In My Humble(Honest) Opinion LMAO=laugh My A** off L2's=Level 2's
#1 RULE...PROTECT YOUR CAPITAL! it is the most needed tool in this game...without your capital(funds)...you can't do anything! #2 RULE...NEVER FALL FOR THE HYPE ON THE BOARDS Lot's of people get overly involved in a stock...and "believe"...don't "follow the hype" blindly...do your own DD #3 RULE...TAKE PROFITS #4 RULE...HAVE FUN!
How is one "flagged" a daytrader? To avoid being flagged a daytrader, you can not sell and trade the same stock more than 3x's in a 5 day period. Buy "XYZ" and sell it the same day=not a day trader. Buy "XYZ" on Monday and sell it on Tuesday=not a daytrader. Buy AND sell "XYZ" more than 3x in a 5 day period= Day trader. You can buy and sell different stocks...just not the same one.
What are "free" shares? Many People will sell a stock once it has "reached" an increase where they can sell to "get back" their original investment and then continue to let the rest of the shares "ride", these are "free shares" (ones that the gain of the pps has "covered") All of these, once sold, would be complete profit.
What are settled funds? You open your account with cash, those are "settled funds", You buy stock XYZ , you sell XYZ to purchase a different stock, It will take 3 business days for those funds to become "settled". Some brokers will let you purchase stocks with unsettled funds but you can not sell that newly purchased stock for the 3 days, The sell of a stock is what needs to "settle" not the purchase of a stock. Think of it as a check clearing your bank after you have deposited it.
Example: I have $200 in a cash account...I buy 200 shares of XYZ on Monday...I can sell those shares ANYTIME after my purchase...in 5 minutes or 5 months...it doesn't matter...I dont have to wait for anything...However, this is where the "settlement time" comes in, although allot of brokers will let you buy with the unsettled funds from the sale of XYZ...I CAN NOT SELL..the new stock that I purchased...(here it is) UNTIL the settlement date...usually 3 business days...
The settlement date applies to the SELL of a stock...NOT the purchase of the stock...
Must have book to read is "a beginners guide to day trading on line" by Toni Turner www.toniturner.com
posted
PAPER TRADE, PAPER TRADE, PAPER TRADE for at least a few months.
-------------------- Before you criticize someone, try walking a mile in their shoes, then when you do, you'll be a mile away and have their shoes.
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Yep this is the correct place to be..... Just be really carefull with what you read and make your own decision.... Lots of gr8 news ect here... Good luck :}
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Thanks for the awesome amount of info. Wow. This is going to be so great!
A few more questions.
- Who do you use for a broker? I've heard of Scottrade, Ameritrade, and obviously E-trade. A friend recommended me Zecco (zecco.com)?
- Where can I find out about how I am taxed? I would imagine Uncle Sam likes to take a huge chunck of change from the profits.
- Who do you trust around here? I mean, what is the point of this board if you can't trust anybody? I hope that doesn't sound as rude as I imagine, sorry if it is.
- How do you trade penny stocks? I heard penny stocks are not like the regular stocks and that you have to place a bid. Is this true?
- Is Level II recommended/required for penny stocks? Who provides Level II and how much odes it cost?
I know, many questions but I'm sure none of you would like to jump head first into this without some info.
Again, thanks for all the help. I'm shedding a tear of joy. =')
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quote:Originally posted by Clockworks: Thanks for the awesome amount of info. Wow. This is going to be so great!
A few more questions.
- Who do you use for a broker? I've heard of Scottrade, Ameritrade, and obviously E-trade. A friend recommended me Zecco (zecco.com)?
- Where can I find out about how I am taxed? I would imagine Uncle Sam likes to take a huge chunck of change from the profits.
- Who do you trust around here? I mean, what is the point of this board if you can't trust anybody? I hope that doesn't sound as rude as I imagine, sorry if it is.
- How do you trade penny stocks? I heard penny stocks are not like the regular stocks and that you have to place a bid. Is this true?
- Is Level II recommended/required for penny stocks? Who provides Level II and how much odes it cost?
I know, many questions but I'm sure none of you would like to jump head first into this without some info.
Again, thanks for all the help. I'm shedding a tear of joy. =')
1. I recommend Choicetrade.com over the ones you named
3. Who do i trust on this forum? me LoL .. oh ok there is a few others whose opinions i respect as well...
4. Penny stocks are traded in same way as Big Board stocks. Bid's and Ask's. Just there is more fraud (fake companies, fake PR,pump and dumps etc.) in pennystocks then in Big Boards therefore they are more risky. My suggestion is that if you want to trade pennystocks that is ok but do not put all your money in pennystocks. Trade 3/4 of your account in Big Board (NASDAQ,NYSE,AMEX etc.) stocks and 1/4 in Pennies.Big Board profits are more consistent then Pennies because Patterns and such in Big Boards are very more consistent and easy to see (Technical analisys).
5. Do I recommend Level II? depends... if you will be daytrading then yes but if you will only be swing and/or position trading then no.. since you can do your DD/Research at night after the market closes and make your picks if there are any for the next day...
Who has Level II? your broker usually and the prices varies...
One last advice.. if you do not know how to trade , do not trade then. Not till you learn at least. Some people recommend papertrading but i tend not to only because papertrading takes out the "emotional" aspect of trading. Lots of people say they make $10,000's in papertrading but when they start trading for real they lose alot of money and do not know why. That is because in papertrading it is not real money at stake so trading's two enemies: Fear and Greed are not present as it is with real trading. My advice is to read a book and if you can afford it and find it get software that let's you trade in "real" time and calculates profit/losses for you. Almost the same as papertrading but it looks and feels more real. Like a video game. You wouldn't play it on paper would you? ... first book recommendation is below. For other recommendations you can do a search of my name and use the keyword book or books etc..
A Beginner's Guide to Short Term Trading by Toni Turner www.toniturner.com
-------------------- Let the world change you... And you can change the world.
quote:Originally posted by littleman: Could any one give some good stocks to paper trade on? I believe it could really help. Thanks
You should be looking for your own stock picks and not someone else's. If you do not know how to look for stocks or how to trade look at post above this one for book recommendation.
-------------------- Let the world change you... And you can change the world.
posted
Mach is a good guy to "listen" to...VERY helpful... Also Steam Ahead thought that you should find time to watch this...there is allot of truth to it... http://www.businessjive.com/nss/darkside.html
-------------------- #1 Rule: Protect your capital! #2 Rule: Never fall for the BS on the boards!
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You will probably lose in the end. It is exciting at first, but if you look back in this forum, the posters from back then are all gone (except maybe a couple).
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I'm a poster from back then, and I lost ALL of it in pennies. Don't fool yourself, penny stock companies sell shares for a living. Put the money in penny stocks you EXPECT to lose, put the money you want to INCREASE in non-penny stocks.
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quote:Originally posted by explorer186: I'm a poster from back then, and I lost ALL of it in pennies. Don't fool yourself, penny stock companies sell shares for a living. Put the money in penny stocks you EXPECT to lose, put the money you want to INCREASE in non-penny stocks.
quote:Originally posted by Youngmoney: HAS ANYONE USED INVESTOOLS OR TEACH ME TO TRADE SOFTWARE OR HAVEN ANY EXPERINCE WITH THOSE COMPANYS? THANKS
Investools is great. Their indictors are great and you can use them on ETF'S to like the QQQQ's. If you use Investools you will make incredible returns every year.
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