can i get premarket trades in any otc:bb stocks?
by Gary James on Friday, July 30th, 2010 | 4 Comments
I’ve been messing around lately with the stock market to get some extra cash lately. I’ve done some research and picked some really good penny stocks a few times. However, by the time the market opened they had already increased making it too late for me to buy. Does anyone know a way to take advantage of this pre-market boom like possibly a brokerage that allows extended trading hours for these penny stocks
Hey everyone, Gary here. Stock trading was never my forte'. I lost tens of thousands of dollars listening to stupid advice and letting other people trade for me.
The stocks trade in the market place, there is no such thing as "pre-market" that the public can have participation.
The bulletin board is a non regulated market so there’s no way you can have any advantage over any else trying to "mess" around.
I’ve been in the industry for over 40 years and have never seen or heard of a "pre market boom" and I have managed all types of trading functions in various markets
You’re looking for something that does not exist, if it did most firms would be out there participating and as of the close of business on Friday, none of them are out there.
If you have an existing brokerage account with an investment firm you should be able to do stock transfer (purchase/sale) orders either in near real time or put them in and ask for execution of order as soon as market opens. Penny stocks are rarely a good investment since it takes so much to gain to cover your broker fess…for example….
You buy 1000 shares of $.10 stock that jumps to $.20 and you sell. You make 100% on your money…right? Well not so quick need to do the math. You made .10 x 1000 = $100 plus you have your original amount of $100 for $200. You forgot the broker fees….to set up the broker account might be a small fee of $5 or $10. There is also the transaction fee to purchase of $10-$20 and to sell there is another fee we’ll say $10.
So….you started out with $100 and spent $5 to set up the account and $10 (or more) to do the purchase so you actually only have $85 to invest. You buy 850 shares (at .10) and they double in price and you sell for $170 (.20 x 85). But when you sell you have to pay $10 so you end up with a total of $160 on investment of $100 or only 60% net return. NOW remember you owe taxes on your gain so come tax time deduct a 10% capital gains rate on $60 for another cost of $6. Net profit $54 with a lot of risk.
It is extremely difficult to get a particular price on a penny stock. They are not traded through an exchange as are other more highly capitalized stocks. And another consideration is that the bid/ask spread is very significant. Your best option is to place a limit order and see what happens.
You’re a S.U.C.K.E.R