How To Get Started Trading Penny Stocks


– I’m gonna show you guys how to get started trading penny stocks. If you’re like most
people you probably have a small amount of money to invest and you wanna turn it into
something much more significant. A lot of people don’t know
how to take that first step, how to find a stock
that they may invest in, how to find a stock
which is a wining stock. The purpose of a business
is to make money. And the purpose of a stock is to give you a share of that business. If you believe that the company itself is going to have a lot of success, increase their market share,
increase their revenue levels, cut down on costs or
be moving or operating in the right kind of industry
that’s just expanding rapidly then you can know that
shares will probably increase in price, because the underlying company’s going to start making more money or having better financial results. So don’t think of
investing in penny stocks as investing in stocks,
you’d think of it as investing in companies. These are just small companies which are just about to make their move to becoming a more legitimate company or more significant company. And when that happens the
share price increases in value. I know you probably wanna
jump right in and get started. I was the exact same
way, I was no different. You wanna take whatever money you have and you want it to start working for you. You want to put it into a stock that’s gonna change your
life and increase in value. You need to be careful, because this is the number one way that you’re
gonna get washed out early in the penny stock game
and you’re gonna regret having even been involved at all. You’re gonna lose money. You’re gonna not get a
good feeling from it. And you’re also gonna miss out on the opportunity or the feelings that you get when you buy a stock that increases dramatically in price. Of course, the first time
you hear about a penny stock is almost certainly going to be because of a pump and dump scheme, where some promoter has got a
million shares of this stock and they’re telling everybody to buy it because the stock is so amazing, because it’s going to change the world, because they’ve got a technology that has an engine which runs on gravity or water box that turns
saltwater into drinking water or they’re gonna have a
huge marijuana dispensary in whatever city. This is, a lot of the
times, a pump and dump, where the person, the promoter, has a ton of shares is just
trying to get the stock to increase in price, even though the underlying company could be garbage. And as soon as they get the money out of their shares that they want, then they stop promoting
it and the stock crashes. You also need to watch out for the stocks which are in the middle
of an investor stampede or they’re being hyped, because then you’re paying too much for the shares. In recent history, we’ve
seen this with a lot of; going all the way back to the .com bubble or the California gold rush
or the Dutch tulip bulb mania. We’re seeing this with
3D printing technologies. We’re seeing this with
electric vehicles right now. Some of the things which are very popular at a certain point in time, the
buying outpaces the selling. It’s not a healthy market. A stock or company which
is worth $2 a share may go to $8 a share, which
is great for investors. And that’s one way to make
money from penny stocks, but you don’t wanna
come along near the end of that promotion or at
the end of that hype cycle. The easiest way to protect
yourself from all of this is a simple tactic to do, right here. Just never buy any stock pick
that you heard about for free, because there’s hidden motivations. You’re basically looking at
an advertisement in disguise, or they’re getting paid by the
company they’re talking about or they’re lying to you to
try and manipulate the price. And almost certainly they would be traded on the dark markets. I’m talking about the pink sheet markets, the OTCQX an the OTCQB. These markets are not
technically stock markets at all, rather than just an exchange
or a network kind of like Ebay. But what’s happening is
that you’re paying too much for the shares, the market
makers are dictating the price, but also it’s very easy to be
listed on the dark markets. What that means is that if you wanna be on the pink sheet markets there’s not a lot of reporting requirements, the fees are very low
and it’s quite easy to pass all the regulations you need to, to get your stock on the dark markets. What that means is that when
you’re looking at 6000 stocks that are trading on dark markets, the vast, vast majority of
them are terrible investments and the vast majority of investors who buy dark market stocks lose money. And part of the problem is that a lot of these stocks you’re
gonna hear about for free, because you joined some
online newsletter, which says, “Hey for free, give us your email “and we’ll tell you what
stock pick we have next week “and it’s gonna go up in price.” And this is what they do
to try and manipulate you and corral you to get you to act how they need, for them to profit. It’s not for you to profit. They don’t know you, they
don’t care about you. They’ll act like their
trying to change the world and show you which stocks
are gonna increase, but why? Why would they do it? And why do they need you to put your $500 into such an such company? There’s no need, there’s
no benefit for the company. There’s no benefit for
you, but what happens is that it drives up the
price and they profit, because they tricked you
into driving up the price. Next big question becomes; Where are you gonna get
your stock picks from? A lot of people don’t know
how to take that first step, how to find a stock
that they may invest in, how to find a stock
which is a winning stock. There’s a big process behind that, but a lot of times people will benefit by getting stock picks
from another source. The thing to remember with this is if you follow a source and
they give you a stock pick, if that consistently turns out to be profitable for you
then do more of that. But if you’re following a source and you’re not making any money or you’re not learning anything, then maybe you wanna not use that source as much and you wanna start
looking around other places. As a business owner
here, I would be remiss if I didn’t suggest that
one of the best places to get penny stock picks
is through peterleeds.com. Our team does a lot of work here and we look for low priced stocks which are gonna increase in value, because the company themselves
are actually gonna increase, in terms of their footprint, in terms of how much money they’re gonna make, in terms of how much of an
industry they capture or own. Over time good quality companies like that always rise to the top. This is manifested by an
increase in share price. But there’s also all
sorts of other sources you should look at. For example stock
screeners, there’s good ones where you can put your
parameters in and say, “I wanna look at every stock
within these price ranges, that are in this industry
and have earnings,” that kind of thing. You set all the parameters
and it’ll give you back a whole bunch of stocks on a list and you can go through them and see which ones catch your eye or
if there’s any that you like, based on what you’re seeing. You don’t just follow somebody’s
comments or selections. If somebody says, “Yes this stock is
gonna double this year.” Don’t just follow that,
because oh he was on the news, so he must know what he’s talking about. What you wanna do is take that in and look at the company yourself and see if it makes sense for you. You also wanna look at
maybe mainstream media, newspapers, online websites. Just be careful what you’re reading and make sure that you understand not only is it a legitimate source that isn’t having a whole
bunch of hidden motivations, but also that even the good sources, people you see talking on CNBC, some of them know what
they’re talking about, other ones don’t. Any kind of stock you’re gonna get a couple of different perspectives on it. Some people say it’ll go up,
some people say it’ll go down. You can have two people
sitting side by side saying exact opposite things, on CNBC. So you need to be able too
adapt to what your seeing. You’re just using it
as a source of learning about what kind of stocks
you wanna learn more about. And then you go to their website, you can phone the company, you can look at their stock charts and learn more and more about them. And one of the best
places to find stock picks is through industry publications, if it’s an industry you
work in and know about. If you are in the mining industry and you’re reading mining publications then you’re gonna get
an idea of which company has a better chance of making money or finding gold or silver or getting to actual production from exploration. If you are looking at
the medical industry, maybe you’re a nurse or a doctor, then you read the industry publications and you know about the
companies in the space and you know which
technologies are important and which technologies are
growing in adoption and usage, then it gives you ideas
about what kind of stocks and what kind of companies
will increase in value. We used our 29 point
Leeds analysis process to find the top companies,
high quality shares, which are going to increase in value. It looks at every aspect of a business, which is so important when
it comes to penny stocks. It’s not like with IBM
or Amazon or Microsoft, where they’re such a huge solid company that they’re gonna be able to withstand a lot of different storms without actually
affecting the share price. With penny stocks, if they get one lawsuit or they lose one big customer or client, or if things go the wrong way, or they get a new competitor, anything can derail the whole company. This is what makes it so difficult to invest well with penny stocks. That’s why 29 point Leeds
analysis is so great at finding companies which
will increase in value, because it looks for all
the downside as well. Not just the upside, but
also the downside as well. So you can avoid a lot of the risks. We’ll give you a link below this video, it shows you the whole
Leeds analysis process. I can’t get into all
of this now, obviously, but there are things you can look for and as you learn more then
you’ll be more effective as you trade penny stocks. For example, what kind of financial ratios are you looking for? How do you know if they’re improving? What are they looking
like in their competitors? All that kind of stuff. We can tell you about what to look for in the financial statements. We can tell you how a press
release is gonna affect a stock. All this kind of stuff,
you can learn all about it right here, on your own time, just by clicking a few videos. So if you have any
questions when you do it, please reach out and ask us. We will help you the whole way. But maybe it’s not for everybody. And if you wanna find penny stocks, that you believe are high quality, yourself there’s different things you need to decide what to look for. You can look for what is the
price point of the shares, what industries are they in, what kinds of growth rates do they have. Maybe you do it based
on the management team. If you have a CEO that made a ton of money on the previous company, now
they’re with this company, maybe that’s a reason why you wanna at least start looking into potentially investing in this new company. But then once you have
a whole bunch of stocks that you’re watching, watch
them for weeks, maybe months, to try to get an idea
about how the prices move and what makes the shares
increase and decrease. And you get to learn more
and more about the company. You get a better idea of
where this company may go in the future and
therefore you’re gonna know where the stock price is going. So now you’ve got some stocks and you know what you wanna invest in,
how to invest in them, and you think that now, “Okay Peter, now can
we go and take my $500 “and put in the stock?” I would say not yet. I would say just step
back, you’re almost there, but just wait a bit, because I don’t know if you know my story, but
when I started investing at 14 years old, I lost all
my money trading penny stocks, within 2 weeks. I got wiped out. And then I learned that I
need to take a step back and understand all of the
aspects of penny stock investing. I need to learn about everything
that has to do with it. And I read a ton of books. And a lot of what I learned I’ve discussed or talked about in Penny
Stocks for Dummies, which if you haven’t read that
book you definitely should. It costs 25 bucks, I
think, and it’ll change your penny stock investing approach. It’ll actually make you
be a lot more successful. And yes I wrote the book, and yes if you buy it I get a dollar
commission or whatever. But that’s not what
I’m talking about here, you can borrow it from the library or borrow it from a friend. But my point is that a big part of it is about paper trading. You wanna start investing
penny stocks with no risk and no money, and it’s very easy to do. And you don’t have to do that forever, just put up with it for a couple months and see how you feel about
how your investing is going. What it means is that you make
an imaginary amount of money, say $100 thousand and you buy
and sell real penny stocks, but you do it only on paper, in your mind. And you say, “Okay, I like this stock. “I would’ve bought this stock
on this day at this price.” And you write it down on a piece of paper. You don’t need fancy
software or any kind of gimmicks or trading apps or whatever. You just write it down on a piece of paper and keep it there and
a then few weeks later you can look and say,
“Wow, so it’s up 7%.” Or, “It’s down 4%.” and you keep buying and selling, on paper, and looking for those penny stocks you think will increase in value. And as I said, if you have any questions or you’re finding that
you’re not understanding how to proceed with penny
stocks, just reach out. You’ll be amazed at
how helpful my team is. And you’ll be amazed
at how helpful we’ll be in terms of getting you on the right track and advanced in terms of learning
how to trade penny stocks. This is what we do, we’re here to help you and we would love working with you guys. And I’ll tell you, for the
subscribers on this channel, thank you so much for knocking us over the 10 thousand subscriber
barrier, just the other day. And you guys know that I respect you and I appreciate you
and I wanna help you out as much as I can. Especially considering how
I personally got started, when I had nobody to help me. I’m trying to help a 14 y
ear old version of myself, but I’m trying to do
that through helping you

12 thoughts on “How To Get Started Trading Penny Stocks

  1. Are you paid by any penny stock companies to promote their stock?
    What would be the top ten filters you would suggest for FINVIZ to find penny stocks that are just starting to break out for swing trades of 3 days to 2 months? I'm a new subscriber and I'm really learning a lot from your deep fundamental analysis videos. Thank you.

  2. with penny stocks does a penny represent a penny? or does a penny represent say if one stock in the company is worth $8 does that penny represent that $8?

  3. I've been trading penny stocks for about 2 years and lost about 9% of my portfolio value.
    I'm almost done reading your book and it made me realize a lot of the mistakes I've made.
    Your warning signs about when to sell penny stocks would've saved me a lot of money like a stock declining when a sector is doing well, stock not reacting to news the way you want, low volume (investor interest falling) and high short interest. I also would've saved some more money if I knew that it takes about a year for companies to integrate acquisitions properly and intangibles and the debt that come with that. I was also pretty shocked to learn that it was possible to use technical analysis to determine when a stock is reaching a bottom or a top. I had no idea that the ratio of higher closes to lower closes was a useful indicator. I've also started using a stock screener like you said and found some excellent companies (thinly traded though).
    I wish I picked up this book sooner, I would've had a lot better results. Are there any other books you'd recommend?

  4. I am so glad I found your YouTube channel! so much information that I'm learning. I'm 21, and I want to get into stocks. this is by far the best help I've gotten from your videos!! thank you so much! im subscribed and. ready to learn more and more. your full of honesty and hard to find someone that is actually trying to help!!

  5. my fiancee and I are new to this and wanna do things the right way the first time around , if you have any suggestion their greatly appreciated, btw your videos are by far the best I've come across you seem very genuine

  6. Your book, experience and your insights accumulated over your lifetime is worth in gold (and silver when silver prices shoot up!). All the best.

  7. Dear Peter you look like Robinson Crusoe living alone on an island talking to coconut trees loosing your mind. Yet you are very clever so please think of yourself as an unruly barking alive trader..

  8. THANK YOU SO MUCH, I am 17 and don’t want to go down the normal path and work 9-5 jobs my whole life.. I want success and you opened my eyes on how to do it, I still have a long way to go into stocks and will stick to your vids for help

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