TheGreenBaron.com - Investor Strategies - Part One
“If given 8 hours to chop down a tree – I would spend the first 7 sharpening my axe” – President Abraham Lincoln.
The investing/trading techniques, strategies and formulas listed below are in no way intended or implied to be trading advice regarding the buying, holding or selling of any stocks or commodities – they are strictly intended to educate the reader to develop effective and successful trading habits that may or may not prove successful in their individual trading practices. Always use risk capital only when investing in any stock and/or commodity and never invest more than you are prepared to lose.
When it comes to successfully and profitably trading Penny Stocks there is a certain misconception among the vast majority of small cap traders, and as a direct result of that “misconception” they end up losing most, if not all of their investing capital on the average within 18 months of making their first trade. That “misconception” is that a “successful” stock play means making huge profits over a period of days or at the most weeks – and that does happen, in fact, the Penny Stocks are really the only place where that can and often does happen, and consistently! Only in the “Pennies” do stocks run up several hundred percent or more in days/weeks – so they’re out there. But think about this; If you are attempting to make a good and steady income from trading Penny stocks that experience huge run-ups in days/weeks, here’s what you are attempting to do; Jump aboard a moving freight train, do the right things while you’re on it, then successfully jump back off that moving freight train- and surviving the entire experience. Keep in mind, that you must do all three successfully, every single time, over and over again. One slip and you’re finished. You make a mistake jumping on the train – you’re finished. You don’t do the right thing and/or do the wrong thing while you’re on the train – you’re finished. You make a mistake jumping back off the train – you’re finished. You have to pull off a “hat-trick” every single play! Again, you must do all three successfully every time over and over again. That is not the best way to minimize risk, maximize profits and consistently make great money trading Penny Stocks. The Green Baron has a better way.
We have been actively trading Penny Stocks for over two decades with some of the biggest Penny Stock players out there and all of those “big players ” never, repeat “never”, operate alone by themselves. They always operate in a group, and more often than not it is them moving the freight train you’re attempting to successfully (and profitably) jump on and off of…and make some of what they perceive as their money during your ride. That’s where you and The Green Baron Investors Society come in.
A man walks into a Doctor’s office and says, “Doctor, every morning when I get out of bed the first thing I do is start banging my head against the wall as hard as I can – and the next thing you know I have this terrible headache. So, Doctor, tell me, how do I stop from getting those headaches every day?” And the Doctor says…? Are you tired of losing money trading stocks, or waiting months (or longer) for little or no profit on stocks you were absolutely certain (or were told) were going to triple in the next few days/weeks, but instead didn’t, or even worse, went down? And now all that investing capital that should be making you money, instead is now tied up in a stock that is not only going to not make you money – but may actually end up costing you money - instead of giving you that 300% return in less than a week like it was supposed to. If so, would you like some advice? Stop banging your head against the wall every morning!
There are plenty of good companies trading in the pennies – plenty of them. The people owning and running those companies have put a huge chunk of their time, effort, life and usually their money into living and working their dream – all they lack is investors that know about their company, their “dream” and the investment opportunity it offers – and they also know that if investors did know about those things, they would invest in their stock/company. Those are the trains we board…together…as a team.
As a stock trader every investment you make is not so much an investment in a particular stock but more so an investment in the future. For example, you do not buy a stock today so that you can go back in time and sell it yesterday. You do not pay a certain price for a stock today with the objective/belief/hope it will stay at the price you paid for it today, but rather for a price you believe it will be in the future. Therefore, you make your stock trades “today” as an investment in the “future”. The “future” is a very important consideration – because “today” will be over in a few hours and the “future” is where you’ll be conducting the rest of your stock trades. Any profits from your investing will be realized in the “future” but they will be determined by your stock trades made in the present. The Green Baron “WALL STREET FIGHTING RULES” are specifically designed to help you to make the right decisions “today” to secure a more profitable “future” – and that’s what investing is all about. Once you learn and begin applying these strategies then you’ll know what investing - successful and profitable investing, is really all about – and just like a boxer during a fight; obey the “rules” and protect yourself at all times.
With the exception of portfolio type longer-term investments, when it comes to shorter term investing, which most penny stock trades usually, if not ideally are, there are several factors that can make a share price dramatically increase within a condensed period of time. The most common are often organically based on the merits of the company, usually due to a major announcement and/or significant development that occurs with a particular company - in addition to the company having a sufficiently sized existing shareholder base to initiate and maintain the increase in share value as well as help attract new investors that will contribute to creating upward momentum in the share value, be it over the short or long term – and of course there are other determining requirements and factors that come into play that we will discuss in detail below.
Penny stocks are where fortunes can be made fast and big – literally over night. Here’s the basic concept behind that statement; Microsoft’s share price is probably not going to increase by 500% in the next two weeks – but I guarantee you, starting today there are numerous penny stocks that will do exactly that over the next two weeks. Of course there is also the inherent risk that comes along with regular opportunities to triple (or more) your investment dollars on a monthly or even weekly basis. This program is going to show you how to not only minimize that “increased risk” – but also how to “maximize profits” while doing so. After a while you will begin to notice there exists a consistent pattern with most small cap stocks trading activity. If there is a “pattern” to something then there is a way to learn and profit from those patterns when investing – if you know how to properly identify and effectively trade certain stocks at certain times.
Follow the Yellow Brick Road:
When famed bank robber Willie “The Actor” Sutton was asked by a reporter why he robbed banks? Sutton replied, “Because that’s where the money is.”
The Internet is not just a great resource for trading stocks but finding them as well. There are several Internet forums and Social Media platforms dedicated to discussing stocks – especially penny stocks. Many of those investor websites and platforms will often identify which particular stock forum/message board/Social Media page are the most “active”. Keep in mind, that 40% of participants in most stock discussion forums have no idea what they’re talking about. 40% of them have an agenda (bashers / hype-sters) but 10% actually have valuable information and content to provide. Obviously you’ll need to decide which particular participants belong in which particular group, but after monitoring the forum for a few days you should be able to accurately identify about 95% of them. Not only are investor forums good for gauging the “quality” of those interested in a particular stock but also the “quantity” of those interested in a particular stock and more investors means more shareholders and more shareholders mean a more active and potentially profitable stock play. The rule of thumb for the most popular investor forums is this; for every one investor posting on the venue there are on the average ten others simply watching (lurkers) that seldom if ever post anything. For every group of those ten “lurkers” there are hundreds (if not thousands) of investors/shareholders owning or at least monitoring the stock in some way – and for a stock to have any chance of moving up significantly over a short period of time, especially a penny stock, it will take at least hundred or so “active” investors/shareholders watching and trading the stock. So, investor forums can become a polling data resource for you to semi-accurately gauge the number of investors/shareholders that are actively trading and/or are interested in or at least monitoring the stock, and if the numbers aren’t there, then neither probably will a stock run be either, at least anytime soon. Unless you have a plan to make money buying and selling a certain stock to and from yourself, you will need other investors to create the necessary activity and liquidity in a stock for you to successfully enter and exit with a profit – and the more “other investors” there are, the more activity, liquidity and profits there will be. So take Willie Suttons’s advice and go where the money is. Or in this case; the investors…
READ PART ONE: INTRODUCTION - Getting Ready to Get Ready - Stop Banging Your Head Against the Wall - Learning and Trading as a T.E.A.M.; Together Each Achieves More - The Financial Benefits of Trading Penny Stocks - Going Where the Money is
READ PART TWO: Trading Like the Big Traders by Trading With the Big Traders – Trading and Conducting "Proper" Due Diligence as a Group – Selling Too Soon? - Minimizing Risk/Loss – Tools of the “Trade” – Paper Trading
READ PART THREE: The Decision Process – Good News Versus Bad News - Obtaining Accurate Data – Properly Identifying Buy and/or Sell Signals – Strategies for Identifying the Right Stock at the Right Time - Your "Top Five" Reasons Check-List - Trading Your Passion - The Importance of Diversification - Effectively Dealing with Delays - Activity Creates Productivity - Keeping it Simple - Trading by the Numbers
READ PART FOUR: “The Green Baron’s Wall Street Fighting Rules” – 20 Proven and Effective Strategies for Maximizing Profits and Minimizing Risk When Trading Penny Stocks – A Must Read for Every Investor!
READ PART FIVE: Common Investing Terms and Definitions
READ PART SIX: CONCLUSION