I’ve been hunting the Internets for the best penny stock newsletters in order to get the word out about which one is the best of the best. There are two types of penny stock newsletters. The vast majority of advertisements that you see will be from a free newsletter. Let’s take a look at why these newsletters are free, how they make their money, and whether or not you can trust them.
Have you seen the ads that say, “1000%+ Penny Stock Picks” and wondered why someone would give away such valuable information for free? The reality is that in order to get the information, you pass along something equally as valuable: your email address. Your email address provides the writer of the newsletter with the ability to turn to companies looking to promote their stock and say, “I’ve got 5,000 subscribers. Use me to promote your company.” Your email address is one of many that the writer has collected and now he or she can cash in.
Cash in? Yes. Cash in on your email address. The writer of the free penny stock newsletter will receive a payment from a company looking to promote its stock. The more subscribers he or she has, the more the payment will be. There’s nothing unethical because the newsletter will clearly state how much was paid for the email to go out down in the fine print at the bottom of the newsletter. It is usually buried beneath the hype so that the average investor doesn’t see it. The savvy investors know that it is there and use it to their advantage. The penny stock newsletter becomes an opportunity to buy a stock on the rise and then to quickly sell it when it hits a target price, which now has us asking if we can really trust these newsletters.
High return investments have a high risk associated with them. Those returns of 1,000%+ come with a potential loss of your entire principal. I’m certain that penny stock fortunes are made all the time, but unless you are an experienced day trader, you will most likely get stuck holding the bag. Savvy investors prey on rookies and people looking for a fast easy buck. They’ll bid a stock up quickly and then just as quickly bail out in order to make their small gains.
The best penny stock newsletters will provide you with a lot of due diligence and a heavy disclaimer. They give a lot of strong information regarding the potential investment so that you can turn around and make an educated decision. They also let you know that they disseminate information for compensation. Subscribe judiciously and invest carefully knowing that there is a high reward, but you could just as easily lose everything.