# Shares Under $0.20 cents



## Afterglow (24 October 2004)

Shares Under $ 0.20 cents

•	Would there be enough interest in this topic to establish a Watchlist????????
•	A Watchlist Consisting of the Top 20 most popular listed shares as voted upon, with a maximum cps value of $ 0.20 cents
•	The following listings have been added to my present watchlist for various and very different reasons.
•	This list, [which does include MUL, the only one on the list that I have a holding in, so far] I present only as a possible starting point and as an example.
AIM	0.0580		BRD	0.0060
AZR	0.1100		OPM	0.0060
BPG	0.0940		LIO	0.0150
BRD	0.0060	 	WAS	0.0200
CBH	0.1800		RRS	0.0270
CMX	0.0980		MUL	0.0380
DES	0.1300		VPE	0.0490
ICN	0.0920		INT	0.0570
INT	0.0570		AIM	0.0580
KMN	0.1950		MOO	0.0660
LAF	0.1300		LEG	0.0840
LEG	0.0840		ICN	0.0920
LIO	0.0150		BPG	0.0940
MOO	0.0660		CMX	0.0980
MUL	0.0380		AZR	0.1100
OPM	0.0060		DES	0.1300
RRS	0.0270		LAF	0.1300
TZN	0.1500		TZN	0.1500
VPE	0.0490		CBH	0.1800
WAS	0.0200		KMN	0.1950

“Pennies to Pounds”

Greetings to all 

At the beginning of September I decided to get more involved with my interest in the Share Market. Turning what was a casual read of the business section of the newspaper into what some would say is a mild obsession, exploring any resources I can get access to, involving many hours of each week.
I am the first to admit that I am just starting to scratch the surface of a large body of information, a body of great depth and wealth that at first glance appears reluctant to relinquish that knowledge.
My understanding so far [Someone, Please correct my understanding, if it’s wrong]
With the concept of getting “the biggest Bang for the Buck “in mind.
Is that with the limited amount of capital left at my disposal?
Say $ 10,000 dollars. 
I should be thinking of shares with a low cps, to maximize my leverage in the market place.
Taking into account the ASX suggested amount of $ 2,000.00 of as a worthwhile minimum.
If the maximum cps entry price is set at $ 0.20 or lower it would allow the purchase of at least 10,000 shares or more.  As the share price increased or decreased by $ 0.01 cents, it would result in an increase or loss of $ 100 dollars per 10,000 shares held or 
$ 1000 dollars per 100,000 shares held etc .

Of the shares in my watchlist, some are only there, because they have appeared in the monthly competitions being held within this forum.
What are the “Why and When” reasons for the picking of these companies for your entry into the competitions?
Is $ 0.0380 the new high low for MUL???
Which companies should be dropped from the list and why? 
What are your choices for a TOP 20 list of shares with a cps price of $ 0.020 cents or less? 
What, Why and When etc. etc.  ??????????????????? 
Yours in Anticipation 
                                     Afterglow


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## Afterglow (24 October 2004)

*Re: Shares Under $ 0.20 cents*

A to K of the above watchlist
http://www.asx.com.au/asx/markets/E...Codes=aim azr bpg bro cbh cmx des icn int kmn
L to Z of the above watchlist
http://www.asx.com.au/asx/markets/E...Codes=laf leg lio moo mul opm rrs tzn vpe was


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## kooka1956 (25 October 2004)

*Re: Shares Under $ 0.20 cents*

I like what you are trying to do AFTERGLOW . After all it's nice to have a stock go up by 20% overnight than having to wait 6 or 12 months or longer for a blue chip . The idea in trying to pick stocks that have potential must have a sound basis , for anyone interested in investing in that stock won't necessarily want to gamble with their money .
Another stock I would put into the list is VSG . They are only three cents at the moment but will be starting production of their unique product very soon . LUM is also interesting . They have a good product but no one wants to buy at the moment . In one day last week went up 25% , maybe something in the pipeline . Some of the GREEN stocks of today will become the BLUE chips shares of tomorrow.  Regards  KOOKA


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## Afterglow (25 October 2004)

*Re: Shares Under $ 0.20 cents*

Thanks for that Kooka; it was great to read some positive feedback as a first responce. I will have a look at both tonight.
Regards Afterglow

VSG and LUM
http://www.asx.com.au/asx/markets/EquitySearchResults.jsp?method=get&template=F1001&ASXCodes=lum vsg


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## Afterglow (25 October 2004)

*Re: Shares Under $ 0.20 cents*

You did hit the nail on the head there KOOKA



> After all it's nice to have a stock go up by 20% overnight than having to wait 6 or 12 months or longer for a blue chip . The idea in trying to pick stocks that have potential must have a sound basis




 AZR ...As picked in the September Competion by "crocdee" went up by 25% today. 
 There was also ICN which went down 20%

Regards Afterglow


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## stefan (25 October 2004)

*Re: Shares Under $ 0.20 cents*

I don't see a watchlist with all penny stocks as something useful, to be honest.
My point is that a watchlist is just monitoring what happened to a stock a short while ago. You will see a stock that moved 20% and while you are trying to get in, the selling has started and you will get stuck.

Frankly, there are way too many penny stocks around and that makes it very hard to pick the right one. I would suggest that the list contains only 4-5 stocks after a lengthy discussion by members of this forum. There are indeed hot picks out there but the trick is to get them BEFORE they move. This can be achieved by building a level of knowledge on a few selected ones so that it is possible to "predict" an upcoming event instead of putting them on  watchlist where everybody gets caught by surprise. 

I strongly believe that it is pointless to have a watchlist of 20 stocks. Anything more than 10 is a waste of time simply because you can't focus enough on that many items. My watchlist contains between 6-8 stocks at the moment. Some of them penny stocks while others  are "respectable" companies. 

While watching the 4-5 favorites there will be other ones running away which got left out. But that's just the nature of the game. If you can't handle this, then you will not become a successful trader. Most "newbies" seem to watch as many stocks as possible only to find themselves lost, missing run after run on each and every one of them because they can't possibly stay focused enough.

Just my thoughts. I know that many are driven by the dream to actually catch the big wave and riding it right to the top. I'm no exception but I think the trick is to find the best approach to catch the wave instead of frantically paddling around only to be trashed by the few waves you manage to get on to. 

- Filter out a few stocks
- Find or better, become an expert for each of them
- Discuss the potential and review your selection regularly
- Don't jump onto the first glimmer of hope. 
- Don't get frustrated if you miss one.
- Trade only very few, but when you do, then do it properly. 
- Build your own opinion. Share it if you like, but by all means, build your own one!!!

That will do! 

Happy trading

Stefan


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## tech/a (25 October 2004)

*Re: Shares Under $ 0.20 cents*

Hmm.

Im with stephan here.

The watchlist concept is interesting---what is it that a stock in a watchlist need do before you trade it?

Personally I think it would be better to select some criteria which would indicate the stock is moving in the direction of trade.
Select a trading methodology IE stop, parcel size, exit/trailing stop.

Id also suggest that someone test the theory (of whats selected) so we can be sure we have a positive expectancy.Without this knowledge your trading blindly.
Which of course 97% of traders do!

I do agree that there is more bang for buck but as the exercise will prove the easy money wont be easy!

I also suggest there is a few "Methods" traded so we can discuss the positives and negatives of each.
Im happy to run one, win lose or draw--Ill disclose all methodology and post a weekly report.

$10K with 5 trades will be difficult.

Anyway let me know and Ill start work.

Would take me about a week to develope something.
I trade ASX 200 so this will be interesting/fun.

tech


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## brerwallabi (25 October 2004)

*Re: Shares Under $ 0.20 cents*

Unfortunately I cant trade during the day and currently now I am trading on a longer term basis. I found it impossible to manage when I was trading every day to manage more then a dozen companies at once. Once I had decided on my watchlist (portfolio- trading stocks)  I found you have to constantly monitor the technical analysis that you have prepared i.e, saved charts that require constant viewing, amount of buyers and sellers, announcements, monitoring of overseas metal and gold markets, movements of similar related companies, market indices, listings on overseas markets, ex dividend dates etc, company reports. I had two computer screens operating one live on etrade, the other being used for research news and other spurious activities. Sometimes popping out for an hour meant that some opportunities were lost, my focus was constantly watching around no more then a dozen stocks and sometimes less, sometimes when I extended my portfolio I found it a struggle when activity was rampant when I held some some stocks that were trading quickly in large volumes - anyway thats my two bobs worth. If you are comfortable with twenty then good luck its more then I could handle.


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## tech/a (26 October 2004)

*Re: Shares Under $ 0.20 cents*

Now although many trade or attempt to trade the pennies,I doubt youll get many takers in this exercise---which will be a pity as I believe it COULD be a massive learning curve for those with enough guts to be honest with themselves.

Most traders are under capitalised.Its much easier to turn a profit with $100K than it is with $10K.Purely due to the costs of doing business.

The second lure of the pennies is most want to turn their $10K into $100K,this year or better still this month!They think the volitility and gains of 50% here and there should guarentee it.Throw in a few would be's who boast "In HINDSITE" about their 100% plus trade---without mentioning their last 15 trades losing 5% each on average and you have the recipe for a bad start in trading!

exercises like this are excellent as they encourage people to trade realtime and expose their techniques to the masses.This makes one think after a short while---a good thing.

Ive seen a few of these run and Ive seen a few chest beaters blow themselves up as they try to emulate the returns they have boasted about with hindsite Trading!

See you better get used to being wrong in this game it will happen more often than not to most.Its what you do when it happens that will determine profit or loss.

97% have no idea wether their discretionary trading Ideas will over the long term turn a profit.They have a win or two and a loss or three and mostly become frustrated that good profit cant be theirs.(After all its easy everyone else is posting their winning trades!!)

See there are only 2 ways of posting a profit I know of.
(1)Trade more winning trades than losers and have a Reward to Risk return of greater than 1.5 x Risk (Dependant on costs of businesss).
(2)Trade with less winning trades but greater Reward to Risk return.

Average loss must be less than average win.The gap can be less with shorter time frame models but the win ratio must be above 50%.

Most have no idea where their method of trading falls.
Hence 97% fail.
If they knew 97% wouldt trade their current method!!!!!!

tech


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## clowboy (26 October 2004)

*Re: Shares Under $ 0.20 cents*

Guys,

Please stop being so critical of people and what they would have done.

While I apreciate that it really isnt that great a feat if you havent actually made any real money, IT IS.

In fact what difference does it make if you have made any real money or not, the important thing is whether you were right or not.

I myself am only doing paper trades ATM (with one real trade as an exception).

If I was doing real trades it would be a whole lot more expensive a learning curve.

But I still hold my head high when a paper trade is succesful, why wouldnt I?

The common thing I have learnt (and seems evident in many of these post's) is that much of shares is about controling emotion - this is far easier to do when it's not real money.

In short I know that some people do nothing but boast about how good they could have been but some of us but some of us are looking back at how good we where to ensure that when it comes tike to trade for real we are even better.

Im not trying to be critical just giving a different perspective.


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## stefan (26 October 2004)

*Re: Shares Under $ 0.20 cents*



> Please stop being so critical of people and what they would have done.



clowboy, I think you missed the point here. Where did you find something critical about what people did in the past? I can't find anything like that. Most postings are saying that it's very difficult to to find the right penny stocks and that a big watchlist won't help much. Only Tech/a is mentioning hindsite trading but that's just one thing out of his argumentation.

There's nothing wrong with posting deals or experiences from past trades. If you did well, then by all means, feel free to post it and share the experience. There is however something wrong with postings trying to lure buyers into a stock because it did well in the past. The past is the past. A stock will not move just because it has so in the past or because you did so well with it last time. 

Happy trading

Stefan


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## tech/a (26 October 2004)

*Re: Shares Under $ 0.20 cents*

((is that much of shares is about controling emotion - this is far easier to do when it's not real money.))

Well this is my point.
Place 20K on a position and see how your paper trading fairs!
Particularly if you find a gap down on open of 5%.

If you have no idea wether your trading methodology accepts a price movement like that or even 3 losses of $1000,how can you possibly know if your Paper trading is long term profitable?

Trading has very little to do with being right-------------It has everything to do with being profitable.

I can be wrong 70% of the time yet Profitable--------work that out!

Iam being critical of those who thoerise without explaination to back up statements.Correct me if Im wrong here but Id have thought the novice would be after PROVEN ways to trade the market rather than thoery.

From what Ive read here in the weeks proir to posting there seems to be Few here who actually trade profitably long term and even fewer who are willing to help newbies find the TRUTH about trading!

Id encourage anyone who trades in a discretionary manner and paper trades to post his trades as they occure and complete with chart.
Infact try to post and make a profit over say 6 mths.
Here on this forum.
Youll learn heaps as you try to "be correct".

Soon youll UNDERSTAND my postings.

tech


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## Mofra (26 October 2004)

*Re: Shares Under $ 0.20 cents*

Afterglow's post to start this thread strikes me as a way of filtering out the 1500 or so stocks listed on the ASX into a manageable watchlist. 

Whilst this is in essence a good idea, I personally can't see the wisdom of filtering stocks based purely on their price alone. A price of below 20c doesn't tell much of a story without looking at either the chart or the underlying fundamentals of a company. In terms of methods of filtering stocks down into a manageable watchlist, I prefer the top down approach, where you focus on a particular sector or stock group that is outperforming the market (or that you speculate will), and then filter the poorer performing stocks from the list. This way, you have the better performing stocks in a sector that looks promising. I've fund it helps to focus on stocks that are more likely to appreciate over time (whatever your timeframe), and doing so helps to put the odds in your favour.

Anyone who has been focussing on the oil sector in recent months will attest to one group of stocks suddenly becoming "hot" - whilst I am not calling the oil rally over, I'm already preparing myself for the next group (given global events and forecasts, I'm leaning towards gold).

Good luck with whichever way you choose to construct your watchlist.


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## clowboy (26 October 2004)

*Re: Shares Under $ 0.20 cents*

Stefan,

I wasnt specifically refering to this post but a few comments etc have been a little critical.

I am not trying to offend anyone just making the point that some may be put off/offended easier than others (the more seasoned traders).

I for one serioulsy value the imput of all as it provides challenges in understanding other peoples point of view.

I guess mostly I just got upset at the boasting comment about paper trading and over reacted....my bad.


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## stefan (26 October 2004)

*Re: Shares Under $ 0.20 cents*



> I guess mostly I just got upset at the boasting comment about paper trading and over reacted....my bad.



Clowboy, you have my full support for paper trading.  It's an excellent way to learn a thing or two. Sooner or later you'll realise that it is still a very different thing compared with trading real money. Simply because it doesn't matter what you do when you paper trade. You will automatically do things that you wouldn't do if it was your real money and once you start putting your own cash at stake, things become far more complicated than what they looked like on paper. 

Keep going!

Happy trading

Stefan


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## tech/a (27 October 2004)

*Re: Shares Under $ 0.20 cents*

My suggested watchlist from 27/10 for stocks <.20c

WTE,TMS,SMM,SBM,SEN,RSN
QAD,PCL,NMC,NWE,NDO,MIC
LIO,INT,ITC,DLS,CUE,CRO,
CFR,BGF,AZR,ATX

Selections purely based upon technicals.

You could trade these in a number of ways.
Next newest high.
Guppy style countback line.
Turn up from most recient support.

tech


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## Afterglow (27 October 2004)

*Re: Shares Under $ 0.20 cents*

First of all, a very Sincere Thankyou for your comments and postings.
After reading them it has once again emphasised to me, how much I have to learn.
As I am finding there is simply not enough hours in the day to do everything I would like to do. The number of hours I have been devoting to the share market is not sustainable in the long term and limiting the number of companies that I am researching does have an appeal for the long term.
 Tech/a please keep your posts coming as what you have posted so far has been of great interest .
Which company  and when  are still the questions
Regards Afterglow


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