Penny Stock Tip: When The Chips Are Down Don’t Panic
January 22, 2020
If for some reason you bought a penny stock to high or held it for too long DO NOT make a panic sell. You still have options. In the end you may be forced to sell but there’s a chance you could make your money back. There’s at least two I can think of off the top of my head.
Option 1: If the company has good, or neutral, long term projections hold the stock. There’s a good chance it will go back up. Just be careful. In stocks nothing is a guarantee. Look over your data to see if it’s viable to temporarily switch your penny stock from short term to long term.
Option 2: For this option lets say the stock crashes: The stock looses 50% of it’s value. All hope is not lost. This move is for the risk takers. If a stock is extremely volatile and there’s no devastating news about said stock then double down. Pump even more assist into that stock. For example if a stock is 20 cents and you wanted to make a two cent profit — meaning you wanted to sell at 22 cents. The stock crashes to 10 cents. Depending on the news put more money in when it bottoms out at 10 cents. You’ll make all your money back when / if it goes back to 20 cents. There’s no need to wait until the 22 cent mark at that point.
At 10 cents you can buy double the amount of that stock then when it was 20 cents. That’s a way to profit without the stock increasing overall in price. Be warned, to do this is highly dependent on news around the crashing stock. If the company took a major hit, or is going out of business, or has horrible long term projections using this tactic is more than likely a bad idea. That being said if you know what you’re doing this can pay off big time.
One last thing. Sometimes as a day trader in penny stocks you have to take the hit. Know your limits and be realistic. Sometimes the best option is to cut your losses and live to fight another day. Even I don’t make money off every trade. (My percentage success rate on day trades is high though. It’s so high for penny stock you probably wouldn’t believe it.)