Welcome!
PennyStocks100 is a private stock trader and investor. We actively manage highly diversified portfolio of speculative "penny stocks" - securities of small companies trading under 5$ per share, (90% under $1 per share). We believe that low price stock when selected and traded properly has tremendous potential to outperform the market and consistently deliver higher returns.
We buy stock when it is close to its' 52 week low and at the same time is experiencing some positive uptrend for several days in price and/or volume. To find optimal entry/exit points we backtest several strategies. We don’t limit our tools to just chart technical analysis. Before opening a position we watch the symbol: analyze the company's fundamental data, such as balance sheet, income statement, cash flow, financial ratios; we review the company business model and risks of bankruptcy. We don't have specific holding period targets. Holding period may range from few hours to several months.
We DO NOT TRADE Pink Sheets or the Over the Counter Bulletin Board (OTCBB) stock trading since objective valuation and even technical analysis of such stock is very difficult.
However we set targets for gains. After 100% run up we close the position. We don't hold stock after 100%+ appreciation This particular strategy is not designed for that. Again, we completely liquidate the position and book healthy profits AFTER ~100% increase in value.
Our Portfolio is very diversified. Statistics for the last 6 years shows that we could hold up to 150 symbols in the portfolio and at least 30 at any given time. Therefore, any stock weight is on average from 0.7% to 3.5%. Today’s market is unique in number of opportunities to invest in strong penny stocks deserving much better price. So, we try to invest in as many as possible symbols. In a strong bull, or in other words "overvalued" market, don't expect to have so many good penny plays. But today we can afford this luxury. Plus, plenty of stocks gives us perfect protection through diversification.
We believe that risk sharing in penny stock trading is extremely important. Diversification is the key element of our strategy. Traditionally penny stock trading is considered extremely risky. We would not fully agree with this statement. Volatile - yes; Risky - it depends... In fact, any trading without necessary experience and knowledge is risky. PennyStocks100 knows how to minimize risks while preserve great advantage of penny stock trading - double or even triple digit returns.
We don't use stop losses or trailing stops. For penny stocks when movement could be so strong and volatile in any direction, stop loss orders doesn't make much sense. Only if the company files for bankruptcy protection we immediately liquidate the position, take losses as they are. We don't wait for a miracle comeback. Instead of stop-loss orders we use diversification.
You may think that with so broad diversification, total portfolio value should be too high to keep cost per trade (brokerage fees) relatively low. This is true. It is always a good idea to use low cost brokerage company, regardless of your portfolio size. We think that the optimal brokerage solution to maintain such diversified portfolio of penny stocks up to $100,000 is Interactive Brokers. Their min $1/trade commission for any stock is a good price even for a $100-$200 trade and 100-3000 shares. Beyond $100,000 you may try other fixed per trade brokers. For example, TD Ameritrade is a very good option, especially if you are able to reduce their $9.99/trade fees down to just $5/trade which is possible to do through different promotions they run from time to time. One we are aware of now is for Cool-Trade automated trading robot customers ($5/trade for 1 year).
In any case, we believe that minimal value of a diversified penny stock portfolio should be $15,000 and recommended $25,000
Our trading is not too active. Usually there are less than 30 trades per month. It is more than conservative investing but definitely less than day trading so we don't bother about SEC day trading rules.
Finally, PennyStocks100 is a FREE real time trader. We started tracking our portfolio on covestor.com since September 2009. Our account is called 'PennyStocks'. If you are interested in our trading and investing strategy, please create your account at covestor.com and track our trades and performance in real time. You may subscribe to RSS alerts /notifications and follow our steps if you wish. We post alerts during the day when trade is done. Few hours lag is not critical for this strategy. In most cases you may enter a position just at the end of the current day or beginning of the next day. It will not dramatically affect your portfolio performance compering to PennyStocks.
We also publish short daily updates on our blog
Summarizing PennyStocks100 strategy and how we are different from many other penny stock traders:
- Strong Diversification
- Technical AND Fundamental reasoning
- NO .PK (Pink) and .OB (Over-The-Counter) stock picks
- Exit ALWAYS after 100% gain!
- NO stop losses (liquidate position completely and immediately IF a company files for bankruptcy)
- ~30 trades on average per month
- $15,000-$25,000 Minimal portfolio value recommended
- FREE instant trading alerts through powerful Covestor platform (Portfolio name "PennyStocks")
So, briefly, that's our strategy, our game plan... feel free to contact us via our blog here
Good Luck in Trading to All !!!
