02/16/2016
This week The Wolf and StockOfTheWeek pumped PVHO, getting an 18.3% rise out of it. They both also mentioned pumping PRKA last week so presumably both websites belong to the same entity. For the moment I'll let them each keep their own label in gmail but I'll consolidate them into one in the future.
The price action seems too choppy to buy and it's too cheap to short but the percentage move is decent so we won't dismiss them entirely as promoters. The PRKA chart looks horrible though so I won't even bother posting it.
Best American Stocks pumped CLOW which saw a 9.11% rise. It's actually interesting to see how long it took for any gains to materialize since I can see CLOW emails hit my inbox back on February 4th.
CLOW's chart looks much more interesting since it's actually at a level that would make shorting at least plausible. I'd want it to break through that high of around 63 cents and keep running before thinking about shorting but I'm still acclimating to the present-day promotion climate so I'm not sure if that's possible. Looking at the volume, it seems like the promoters were selling heavily into any attempts to breakout but we'll see. I'll keep my eye on it.
The Daily Stock Reporter which I've labeled EGM Firm Inc. based on their email disclaimers, has been pumping GOGY. One such disclaimer reports they have received $15,000 dollars compensation for the promotion though they apparently own zero shares. While GOGY did go up 29.05% (only a $0.009 increase), the chart is so ugly you wouldn't want to waste your time looking at it.
Beat Penny Stocks promoted SNDY. I had originally grouped Beat Penny Stocks with Penny Picks because they were sending identical emails but I can now see in one of their email disclaimers that their true entity name is Stellar Media Group, LLC so I'll change my labels for both of these newsletters to reflect that. According to the disclaimer, the group received $12,500 dollars to promote SNDY. We can also dismiss SNDY as a tradable ticker. The chart is too gross.
Hi, I am a total noob to trading but have been trying to learn by doing research the past few weeks. I have noticed that these pump and dump email promotions almost always climb a decent percentage at opening of the next morning and then level off, but from my understanding(Something that I read in your blog.) it is hard to buy these shares. If I were able to buy some that day, it seems that selling them at markets open would more often than not be profitable. Also, just how hard are buying and selling these stocks? I have never made a trade yet. I want to have a little bit of an idea of what I am doing first.
ReplyDeleteThanks
P.S. Last week I decided to use $1000 of play money and start to try to invest with some of these pump and dump stocks. I would have bought the shares at markets close and and sold them at markets open. I bought four stocks in four days and would have ended up with around $2200 if I could do this. That was before I found out that these stocks are hard to buy, so my bubble burst quite a bit learning that.
If your broker lets you paper trade (use fake money), you can try that for a while to gain some familiarity with how the markets and your broker work. Take this with a grain of salt though because paper trading won't give you an idea of how difficult it can be to get fills when trading pump and dumps since they tend to be lower volume.
DeleteI personally haven't traded any pump and dump stocks for a while because I haven't seen run across one that I considered to offer good enough risk/reward.
Buying these stocks can be difficult because the bid/ask spread can be large, so if you get filled on the ask, then try to sell on the bid, you will immediately lose money. If this confuses you a little, do some more reading to understand what these terms mean.
It's great that you're doing research before starting to trade. That already sets you above many others but you need to be careful when you do decide to trade. Starting with pumps can be dangerous, but hopefully the info in this blog will help you manage your risk wisely.