Tuesday, September 11, 2012

Penny Stock - Pump and Dump.

Folks, let me educate you a little on penny stock investing. 

Pump and dumps are when the shareholders in an empty bogus shell company hire a penny stock marketing group for $50,000 to promote their stock. They have no product. No patents. Just a lot of good sounding talk. Then if/when their penny stock climbs 100% or more following the promotion, they sell huge amount of shares into the upward move causing the stock to dump. 

For their $50,000 investment to hire the penny stock market group, they made an additional $500,000 or more selling their at the elevated price before the dump. That's a pump and dump. It happens on 3/4ths of the penny stock promotions you will ever see. But there's about 1/4th of penny stock promotions that go on to have HUGE gains with sustained uptrends that last several days, several weeks, and even several months.


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