Australian (ASX) Stock Market Forum

1c-4c Penny Stock PHENOMENON

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doctorj said:
The market is a fickle beast - I wouldn't bother trying to guess. You can narrow it down, for instance, Iron Ore is still the way to go but beyond that, the herd is chaotic and often irrational.

I bought some MPJ a little while ago on the basis that it was a relatively low risk penny dreadful since the SP is underwritten by its shareholdings in other listed miners and its cash balance. They've also got some pretty low key exploration of their own tenements going on. I figure it's this that will move the SP as you can essentially buy their own tenements for free right now.

I highly doubt the HC boys that try to ride ramps to financial freedom do very well. Sure, individually they occasionally make a killing in very short order, but they tend to also be the ones left without a chair when the music stops. I'd say its likely that their style of trading means that a single loss is likely to wipe out several months worth of gains, if not more.
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I completely agree with you on this one and love your musical chair analogy. What they are doing is essentially betting on what is known as the Martingale strategy in betting circles. They will make a small profit on most occasions and it will be obliterated by that one big loss. :)
 
drfuzzy said:
I completely agree with you on this one and love your musical chair analogy. What they are doing is essentially betting on what is known as the Martingale strategy in betting circles. They will make a small profit on most occasions and it will be obliterated by that one big loss. :)
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Good point DrFuzzy

I noticed your response was made to a posting by DoctorJ made in 2008.
I also noticed there are almost four threads with similar themes around Penny Stock .
Probably there is a merit to amalgamate them into one by our dear Joe the Administrator
Neverthelesss thanks for your comments and I do agree with your observation.
 
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