I think everyone has a hidden trait in them which draws them to cheap stocks, the ones below $5 with the hope that one of these little companies will make it big and fly to $20-$30 and make them tons of money.
Well atleast I am one of those guys! Yeah I know, I am a cheapo!
Lot of you might be knowing FRPT (Force Protection Inc.). It was one of those EPS momentum based big movers last year. It moved from around $3 to $30.
Well when the first news came out that they had received their first order from US Army sometime back in 2003, it was an OTCBB stock trading around 40 cents. I saw the news and I bought it right away, hoping to make tons of money! It went down to 20 cents (due to heavy dilution) and kept going down, and I held on. Finally, it reverse split and the price became $4, it kept falling again, it fell all the way to 69 cents around December 2005. My position in that stock was worthless and I sold it in December 2005 for tax purposes.
If you look at the 3 year chart of FRPT, you will certainly call me the biggest loser on earth!!! Just when I should have bought loads of FRPT, I sold it instead and never looked back. It first moved from OTCBB to AMEX and then to NASDAQ. In the process it shot to $30, as I had predicted when I had bought the stock in the first place. Well so much for timing and patience.
I hope you too found my story funny!
Anyway, so I have this thing for cheap small/micro cap stocks. That was the reason I signed up at http://www.smallcaps.us/. They are free, independent and unbiased, so I usually just follow their picks, some of them do quite well. One company had caught my eye, Hemispherx BioPharma Inc - HEB
smallcaps.us kept saying this is one of the most undervalued micro cap stocks. Somehow I took the chance and bought first at around 1.45 and then around 1.25 and held on. Today its high was 2.02, I sold some at 1.98. Hope to see it continue upwards. Anyways, these folks made me money, and a mention and thanks was on the cards!
Cheers!
Lazy
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2 comments:
Hi Lazy,
Thank you for checking out my blog.
I briefly read up on your Strategy Post, and I must say we share similar views...
I would much rather spend "30 minutes" generating 20% annually than spending ,like you mentioned, using an MBA strategy 3 hour/day generating 30% annually.
Btw: I am also a fan of CRNT...
Lazy, thanks for stopping by. I'm glad I've found your blog.
I'm thinking about trying out an earnings-based/technical system in the future.
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