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Penny Stock Basics
Strategy
Oil, Gold, Currencies and More
Screening and Research
   Use Penny Stocks to Capitalize on moves in the Price of Oil, Gold, Currencies and
More.  During the recent explosion in Oil prices, which may or may not be over, blue
chip stocks that were affected positively were essentially canceled out by the
stocks disrupted in a negative way.  There are tons of ways in which traders and
investors exploit changes in the perception of supply and demand in energy,
commodity and currency prices.  With respect to Oil, traders may simply buy the
futures contact itself, light sweet New York Crude for any number of months out.  
Or they may play the Gasoline, heating Oil or natural gas markets.  Often, investors
will buy or sell shares of an ETF, or Exchange Traded Fund that is heavily weighted
in the Oil, or Gold sector to prevent the risk of investing in only a few exploration,
mining or manufacturing companies.  They may also further attempt to enhance
their profits by using their investment in Jet Fuel to borrow shares of an Airline, to
use an obvious example, and selling them short at the same time.  Sure, you can
open up a new futures account, or buy Exxon Mobil on margin, but in the main
stream world of investing, it will take a very large amount of capital and a good deal
of time and risk to capitalize on a Ten Dollar move in a barrel of Oil or a Twenty Five
Dollar move in the Price of Gold.  This is where Penny Stocks come in.
  Don’t get us wrong, playing with Penny Stock Oil and Gold exploration companies
is far more risky than buying ETF’s or other blue chip type plays.  It is perhaps the
risk/reward relationship, however, that is most enticing.  Penny Stocks allow you to
use a lot less of your portfolio to attempt to capitalize on moves in Oil, Gold, foreign
exchange, and other instruments, with the potential for far greater percentage
gains.  This, believe it or not, lowers the risk, as only a tiny percentage of ones
portfolio is at risk, and if we consider the volatile nature of these types of markets,
will likely cause a lot less headaches.  We have to very careful with Micro Cap
companies that are engaged in the exploration of Oil and Gold, however, as they
tend to be a different breed of entities.  They often have a very large amount of
shares outstanding, are buried in debt, and who knows if they will ever actually
find black gold.  Weeding through the ever growing list of Energy and Commodities
companies whose stock is priced below a buck to find potential movers can be time
consuming, but not if you know what to look for.
   Penny Stocks allow you to use a lot less of your portfolio to attempt to capitalize
on moves in Oil, Gold, foreign exchange, and other instruments, with the potential
for far greater percentage gains.  This, believe it or not, lowers the risk, as only a
tiny percentage of ones portfolio is at risk, and if we consider the volatile nature of
these types of markets, will likely cause a lot less headaches.  We have to very
careful with Micro Cap companies that are engaged in the exploration of Oil and
Gold, however, as they tend to be a different breed of entities.  They often have a
very large amount of shares outstanding, are buried in debt, and who knows if
they will ever actually find black gold.  Weeding through the ever growing list of
Energy and Commodities companies whose stock is priced below a buck to find
potential movers can be time consuming, but not if you know what to look for.
Stock Research
Enter Symbol:
Oil, Gold, Currencies and More:
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