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 HOW TO RESEARCH PENNY STOCKS:

-Okay, you found a penny stock to research. If you got the ticker from a message board where it has been spammed, than don't just believe what you read, go RESEARCH it. Chances are it is being pumped and you may end up buying at a HIGHER price because other suckers are bidding high to get rich quick. Let them. Don't EVER buy on impulse unless you are a very lucky person. Beware the PUMP and DUMP. Various hypsters PUMP up a stock by starting rumors and than they DUMP that stock by selling at a profit to suckers that chased it to get in high- DON'T BE A SUCKER! 
 

-Now, to research, first GO TO THE OTC WEB SITE TICKER SEARCH  and check the status of the stock ticker and company name. Then you will know if they are or are not meeting the new eligibility rules. Look to see if the company is going to get an "E" or if they are going to be de-listed...maybe it's being pumped because the hypster knows it is going to the pinks sheets and wants to dump it.  If you decide that you are still interested, then go check out the companies  TAX FORMS that have been filed. Read, read, read. Is the company only worth $45.00? Is it a shell?

-Get the Company's phone number and give them a call or e-mail them. Also- double check to WHERE and to WHOM the phone number is registered- go do a REVERSE PHONE/EMAIL LOOK-UP- is the address residential or business? Is it the CEO's home? Be weary of scams- YES- CEOs lie too. Ask them what they are doing to produce REVENUE! Do they have a plan? Ask who you are speaking with. Ask if a reverse split is in the plan. 

-Check out the history of the stock quote. Go look at charts. Has your stock recently had a run? Has it been pumped and dumped recently? Investigate further, go check out the company web page (if they have one). Go to their Investor Relations page. Read their past Press Releases- did they follow through? Do a GOOGLE SEARCH of the company on my favorite search engine. Put the company's full name in quotes and read all that you can read. Put the president's full name in quotes- do bankruptcy or legal cases pages come up? Also- do another type of search to see if they have any patents using this FREE PATENT SEARCH  

-Now you need to come up with a strategy. What is your mission here? Did you find a great penny stock to go LONG with or do you just want to buy it and sell it quickly if it runs? Make sure that YOU know what YOU are planning to do. Give yourself a price range to ENTER and a price range to EXIT. 

-Here are some articles posted on various message boards which are worth reading:  George Chelekis' HOT STOCKS REVIEW   Penny Stock Fraud Article   Buying And Selling Basics  -After you read those articles you may now go and check out what others are saying about your stock on the dreaded, manipulated, but oh so entertaining message boards. Start from the first post on your company and scan through all the messages. Are you rethinking your ENTRY and EXIT? Well don't- you did your research...you have the upper hand. 
                     MANIPULATED MESSAGE BOARDS:   CLEAR STATION   RAGING BULL   SILICON INVESTOR

-You can GO HERE to find all the OTC Penny Stocks if you want to search for your own diamond in the rough

             GOOD LUCK- IF YOU FIND A WINNER PLEASE THROW US BONE

INVESTOR LINKS:

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Mini Glossary of Investment Terms For Puppies:

Ask
The lowest price a broker asks customers to pay for a security.

Beneficial Owner
The true owner of a security which may, for convenience, be recorded under the name of a nominee.

Bid
The highest price a broker is willing to pay for a security.

Bond
A certificate which is evidence of a debt in which the issuer promises to repay a specific amount of money to the bondholder, plus a certain amount of interest, within a fixed period of time.

Broker-Dealer
An entity engaged in the business of buying and selling securities.

Call
The right in options contracts to buy underlying securities at a specified price at a specified time. Also refers to provisions in bond contracts that allows issuers to buy back bonds prior to their stated maturity.

Cash Account
A type of account with a broker-dealer in which the customer agrees to pay the full amount due for the purchase of securities within a short period of time, usually five business days.

Closed-end Fund
A type of investment company whose securities are traded on the open market rather than being redeemed by the issuing company.

Commission
The fee charged by a broker-dealer for services performed in buying or selling securities on behalf of a customer.


Discretionary Account
A type of account with a broker-dealer in which the investor authorizes the broker to buy and sell securities, selected by the broker, at a price, amount, and time the broker believes to be best.

Dividend
A payment by a corporation to its stockholders, usually representing a share in the company's earnings.

Equity Security
An ownership interest in a company, most often taking the form of corporate stock.

Face Value
The amount of money which the issuer of a bond promises to repay to the bondholder on or before the maturity date.

Form 8-K
A current report required to be filed with the SEC if a certain specified event occurs, such as: a change in control of the registrant, acquisition or disposition of assets, bankruptcy or receivership, or other material event. Form 8-K is required to be filed within 15 days of the event.

Form 10-K
The designation of the official audited financial report and narrative which publicly owned companies must file with the SEC. It shows assets, liabilities, equity revenues, expenses, and so forth. It is a reflection of the corporation's condition at the close of the business year, and the results of operations for that year.

Form 10-Q
Quarterly reports containing interim information that is "material"--important for investors to know. These must be filed with the SEC.

Interest
The payment a corporate or governmental issuer makes to bondholders in return for the loan of money.

Investment Company
A company engaged primarily in the business of investing in securities.

Margin Account
A type of account with a broker-dealer, in which the broker agrees to lend the customer part of the amount due for the purchase of securities.

Money Market Fund
Generally, a mutual fund which typically invests in short-term debt instruments such as government securities, commercial paper, and large denomination certificates of deposit of banks.

Mutual Fund
A pool of stocks, bonds, or other securities purchased by a group of investors and managed by a professional/registered investment company. The investment company itself is also commonly referred to as a mutual fund.

NASDAQ
National Association of Securities Dealers Automated Quotation System is a system that provides broker-dealers with bid and ask prices for some securities traded over the counter.

Net Asset Value
The dollar value of one share of a mutual fund at a given point in time, which is calculated by adding up the value of all of the fund's holdings and dividing by the number of outstanding shares.

No-load Fund
A type of mutual fund that offers its shares directly to the public at their net asset value with no accompanying sales charge.

Odd Lot
Fewer than 100 shares of stock.

Open-end Fund
A type of investment company which continuously offers shares to the public and stands ready to buy back such shares whenever an investor wishes to sell.

Option
A contract providing the right to buy or sell something--often 100 shares of corporate stock--at a fixed price, within a specified period of time.

Over the Counter (OTC)
A market for buying and selling stock between broker-dealers over the telephone rather than by going through a stock exchange.

Prospectus
The document required to be furnished to purchasers of newly registered securities, which provides detailed information about the company issuing the securities and about that particular offering.

Proxy
A written authorization given by shareholders for someone else to cast their votes on such corporate issues as election of directors.

Proxy Statement
A document which the SEC requires a company to send to its shareholders (owners of record) that provides material facts concerning matters on which the shareholders will vote.

Put
The right, in an options contract, to sell underlying securities at a specified price at a specified time.

Quotation (or Quote)
The price at which a security may be bought or sold at any given time.

Registered Securities
Stocks or bonds or other securities for which a registration statement has been filed with the SEC.

REIT
Real Estate Investment Trust, a type of company in which investors pool their funds to buy and manage real estate or to finance construction or purchases.

Restricted Securities
Stocks or bonds which were issued in a private sale or other transaction not registered with the SEC.

Round Lot
Generally, one hundred shares of stock or multiples of 100.

Specialist
A member of a stock exchange who operates on the trading floor buying and selling shares of particular securities as necessary to maintain a fair and orderly market.

Stock
An ownership interest in a company, also known as "shares" in a company.

Street Name
A name other than that of the beneficial owner (e.g., a broker-dealer) in which stock may be recorded, usually to facilitate resale.

Unit Investment Trust
A type of investment company with a fixed unmanaged portfolio, typically invested in bonds or other debt securities in which the interests are redeemable.

Yield
Generally, the return on an investment in a stock or bond, calculated as a percentage of the amount invested.

                         

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