Happy Monday to everyone. The market has opened for another week of volatility. Today’s Financial Topic is: Penny Stocks.
I’ve touched on this in the past but wanted to revisit it since the one and only penny stock that I own (and will EVER own) just had it’s Caveat Emptor tag removed and has gone up a bit (so my losses are now only about 50% vs 90%). Why have I kept this horrible stock? 1. As a reminder that I should never invest another penny into penny stocks. 2. I don’t need to show the loss for tax purposes…yet.
So where does Atlantic City come in? Most people think Las Vegas when it comes to casinos and gambling. I’m from NJ and we have Atlantic City nearby if we want to gamble our money away.
The analogy I’m trying to make here is investing in a penny stock is essentially taking your money to the casino (but with worse odds). I admit I’m not much of a gambler at all. Only a few times in my life have I spun the roulette wheel in AC or sat at the blackjack table in Las Vegas. The point here is that I never walked into a casino expecting to win. If I brought in $100 or whatever, the goal was to make the money last a bit and it was deemed “entertainment”. I never expected to get rich and win but the small feeling of excitement does have an allure to it.
Investing in penny stocks is just that. Don’t invest any money in them expecting to win or get rich. 99.99% of the time you will likely lose everything you put into it. Just like you should never walk into a casino with anything you can’t afford to lose…same rules apply. If you wanna throw a couple hundred bucks at a stock sitting at $.002 and buy 100,00 shares….go for it. A couple hundred dollars may not break the bank for you….and the thought of that stock maybe hitting a dollar one day (it won’t) and making you $100K (never happen) may just be all the gambling excitement you need!
