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Wednesday, 9 October 2013

Penny stocks and bad boys

If you ask young teenage girls what kind of boys they prefer, most will say bad boys. Of course that's provided you ask in confidence and not in public

And if you ask most newbie "investors" and traders what category of stocks they first got involved with, most will reply penny stocks.

What's in common between penny stocks and bad boys?


Excitement.


It's usually a phase we outgrow from.

When young girls grow up, who do they marry?

1.  Marry blue-chips - mature men with established careers or businesses.

2.  Marry mid-caps - Ambitious and career minded men with dreams.

3.  Marry penny stocks? All we need is love! And a lottery ticket.


Nothing wrong with penny stocks. Venture, Osim, NOL were once upon a time penny stocks too. Imagine if you had bought these stocks when they were below one dollar?
   
NOL? Yes, NOL was at 50 cents during 2003 when they lost their CEO and were swimming in a sea of red ink... Fast forward to 2007 and NOL hit $6! 

I completely missed this 10 bagger and the embarrassing thing is I were working in Supply Chain then!!! 

Pain!

It's like those working in IT buying the theme-of-the year Oil and Gas sector plays; while those working in Oil and Gas sector chase after the latest hot IT stocks. LOL!


Life is not a straight line extrapolation

Sadly, it isn't so.

Some blue-chips will have affairs and break your heart...

Ambitious mid-caps are good until you discover they are so ambitious they never have time for you... Or so fragile that one single failure can destroy them...

Yeah, everyone warns you against marrying that ah beng with ang-kongs (tattoos) all over. But what a surprise! Who knew this lottery ticket will one day IPO his company to the public?


Plan less; live more

Enough said.   





23 comments:

  1. can't believe i bot these bad boys!

    if they can't give me a 100% return, i'll throw them away!

    ReplyDelete
  2. coconut,

    That's why I say you still young at heart!

    Actually, with proper risk management, it isn't that scary. We only risk what we could afford.

    People are only focusing on the panic selling. I am taking notes on the buying. Evidently someone besides you is also stepping up to absorb all the selling ;)

    ReplyDelete
    Replies
    1. but i'm not a girl le?!

      by the way do you know that these three little piggy you have to have cash out front in order to buy? cheque are not acceptable, must be cash or cash equal i.e. casher order etc.

      thats how they wanted to protect the public from entering the trade, like our casinos. what are they thinking?! they doesn't care about the people already inside.

      Delete
    2. ok got confirmation, they are average price,

      liongold - 0.169

      asiasons - 0.11

      still have half the money waiting, see how it goes.

      Delete
    3. coconut,

      All the more I am impressed with the buying! It's cash up front. But I too old to join in this party. So just watch and taking notes :)

      I've read your comments at AK's blog.

      My personal view is:

      Amateurs need hand-holding (or someone to blame).

      Professionals man up.

      Delete
    4. coconut,

      How I know you not a girl? I've never met you.

      And how you know I not actually blond with blue eyes? I put up a pic and you believe? LOL!

      Just a while ago somebody says it's 100% his broker's call. I wonder why this somebody is monitoring the trades?

      Outsource or DIY?

      Who is smoking who?

      Ha ha!

      Delete
    5. na, no problem la, i only put 100k outfront, used up half of it. still a small player.

      i guess maybe i had a good run this past 18 months, its time to give back some haha.

      Delete
    6. well its true i don't have appitie for penny stocks, not my play actually.

      i can't execute the trade on line, so i call my brother to do on my behalf, he knows what to do and he knows these little piggies, with my money ofcos.

      Delete
    7. Ah so!

      Playing with realised profits ;)

      Makes sense.

      It's good to have a broker you trust to execute at the best prices for you.

      Have fun!

      I going to Chinatown library later to join the retirees there. Got free air-con ;)

      Delete
    8. oh this somebody is me haha, ofcos i have to know what i'm buying and at what price! what a kongcam.

      i determine the entry and exit, my broker execute them, thats what i meant haha.

      i'm not monitoring the price or trades, my eyes and brains already occupied! to take a look once in a while is not monitoring in my defination. monitoring means seeing the price movement at all times if possible, i guess you don't know what i meant.

      Delete
    9. you want to become trader, can't you just sit infront of the market even if you are not trading or no positions?

      how to spot opportunities?

      Delete
    10. coconut,

      I not above taking some quick intraday profits in the Simsci. Sometimes I laugh at myself - sit whole day in front of the screen and making only $200? I am lousy as a day trader :(

      I am more comfortable as a trend following swing/position trader. I wait for the trade to come to me.

      When in a new position, just enter my stop loss order to limit my downside. With a winning position, just enter a trailing stop to protect my profit.

      I don't monitor or watch my position all the time ;)

      OK, call me lazy.

      Delete
    11. honestly, to be a trader, you have serious, i mean serious issue!

      i woun't go into it, i still want a blogging friend haha.

      Delete
    12. coconut,

      It's OK. You're a coconut; I'm an equities man-whore.

      Accept the diversity ;)

      Let's not try to mould others in the image of ourselves. Leave that to the zealots.

      LOL!

      Delete
  3. Hi SMOL,
    I enjoy your funny analogy and writing style there! It resonates with me too lol.

    ReplyDelete
    Replies
    1. CSCCC,

      LOL! Thanks!

      I see we have a young financial blogger in the house! Got "blessed" by Musicwhiz some more!

      I am impressed!

      Musicwhiz is one of the few true blue value investor I respect. Most others are just "wannebes".

      Cheers!

      Delete
    2. Haha pls I cant take that big hat.. still very young and got much to learn! Be it investment skills or writing skills or generally everything.

      Delete
  4. Hi Smol

    Matured men cannot fly because they dont hv wings while ah bengs I heard they can fly from one place to another... hehehe.

    Bad boys remind me of the edison chen incident. Since then I think most girls prefer matured men instead hehehe.

    ReplyDelete
    Replies
    1. B,

      No.

      Most girls will prefer Edison Chen - minus the photo-taking of course! Just make a list of how many girls were in his C-drive ;)

      Women marry mature men for perceived security and better life.

      OK, maybe some because of daddy dearest complex...

      Hmm... I wonder why I've always preferred mature women? Oedipus complex? Eee!

      LOL!

      Delete
  5. Hi SMOL,

    I like this blog post. :D

    But hor, for some people, planning = living. Then, how?

    This is a difficult question for me to answer. Can help? :(

    ReplyDelete
    Replies
    1. AK,

      Thanks!

      You are not above playing with S-chips (China Minzhong) and penny stocks (Marco Polo). You naughty! Bad AK, bad role model. Tsk, tsk...

      Ha ha!

      Its never about the "labelling"; it's always about the size of our baxxs and the grey matter between our ears!


      The operative word is plan LESS; not NO planning at all ;)

      It's a bit like the Taoist non-action (无为).

      If I can let go of planning for a tomorrow that may or may not come completely, I'll be an immortal!

      You already know the answer. We just use different words to express similar things.

      Did someone once said not to be too pessimistic nor optimistic on the future market direction? It can be applied to life as well :)

      Some like to live in the past - dwelling on past glories or not forgetting the wrongs done to them and past mistakes made.

      Some like to live in the future - when I get my first $X million or when I have $X passive income, I will...

      Eh... Who is doing the LIVING in the HERE and NOW?

      LOL!

      Delete
  6. Personally I only buy stocks with price above $5 .. penny stock no thanks

    ReplyDelete
    Replies
    1. Ah! A reader from US!

      Tseten,

      In Singapore's stock market context, most of our stock counters are priced below $1 - which I class as penny stocks :(

      The majority of Singaporean "investors" class penny stocks as those below 10 cents!? Literally counting the pennies! LOL!

      It's a cognitive dissonance thing... Many just can't admit the majority holdings of their stock portfolio are penny stocks...

      Cheers from Singapore!

      Delete

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