8 Penny Stock FAQs Answered

8 Penny Stock Frequently Asked Questions Answered

I get a lot of questions about penny stocks from my students…

But a handful just keep coming up.

Chances are, you have these questions, too.

So here are they are. The most common questions I get about penny stock trading, my own personal motivations, and my brand as a whole…

These come directly from followers just like you…

Hopefully these answers clarify some of the things you may not understand about my penny stock trading philosophy.

Question #1
Why do you teach if you’re so good at the stock market?

I’m very far from being the best trader… but I have made millions despite my faults.

My nearly 20 years of experience helps me guide people on what to focus on in trading.

But I’m self-taught…

So why do I teach?

Because I believe you deserve the mentor that I never had.

Let me be clear. I can teach you…

But I can’t tell you the exact bottom or top of a stock, I just try to take the meat of the move.

You’ll actually see over time that many of my students do better than me on one or more trades…and I love seeing that!

Question #2
Can I just follow your trade recommendations and “get rich?”

NO!

Don’t get me wrong… my recommendations and newsletters can be a big help to you…

But it’s not enough to only wait for me to write to you with instructions.

None of my millionaire students, nor I, nor anyone I’ve ever met has built true wealth by mindlessly following anyone’s alerts.

The key to success is learning to develop your own plan in the stock market.

Whether you prefer going long or short, holding for a few minutes, hours or days…

We’re all different, so we all trade differently and must consider our own strengths and weaknesses in trading.

Unlike far too many chat rooms and newsletters that just mention a ticker and the price (some of whom get compensated on every trade their subscribers make due to their relationship with brokers/hedge funds), I specifically write out several sentences whenever I post a trade alert.

My students can then understand my reasoning/plan/mentality for entering or exiting a position, not so you can copy my exact trade.

You don’t want to be mindless sheep.

Question #3
How are you always right on stocks when it’s so difficult for everyone else?

On the contrary, I’m not right all the time.

I lose roughly 25-30% of the time.

And a good amount of my small gains are technically misses where the stock didn’t do what I expected so I exit quickly to play it safe.

Small losses and small gains don’t matter to me. They don’t move the needle on my overall account growth at all.

The key to my overall success is cutting losses quickly. I exit trades that don’t.

90-95% of traders lose because they don’t manage their losses…

And small mistakes turn into big disasters…

You won’t be one of those traders if you follow these key stock market rules.

Question #4
How do you make money when stocks go down?

It’s called “short selling.”

Long story short, you take a negative position in a stock and make money if and when the stock goes down, or lose money if and when the stock goes up…

Question #5
Do you have to be glued to your computer all day long?

Not at all.

Some days there are no great trades.

I have many part-time students who study at night or just try to fit in trades whenever they can…

There’s no one right way to do this.

Make the stock market work for you!

Question #6
Do you guarantee profits if I study hard?

NO!

Profits are never guaranteed, no matter how hard you study or how badly you want success…

That said, the harder you study and prepare, the higher your odds of success will be.

But you won’t do as well if you don’t study hard.

Question #7
I’ve studied a ton, but am scared to risk actual money. When is a good time to begin actual trading?

This totally depends on you!

Remember, make the stock market and trading work for you, not for anyone else.

We’re all different.

The key is to be comfortable when risking your hard earned money.

For some people that’s one day of studying. Others prefer a week or a month; I know several students who study for six months first…

There’s no one right answer.

I like to think of “trading school” like medical school…

You don’t see first year med students performing brain surgeries.

They have to study, pass tests, and get comfortable with their knowledge base before risking another person’s life.

So picture your trading account as a life…

You don’t want it to die.

I’m a big fan of over-preparation.

Maybe start small with just 100 shares at a time.

You need to get a feel for these weird stocks and patterns.

Question #8
How soon after I study will I begin profiting?

It totally depends on what kind of market there is; my strategy can make money in bull and bear markets, but there’s tons more opportunities in bull markets.

That said, you also need knowledge and preparation to profit consistently.

Do not expect to profit right away.

You have to start by studying and developing both your knowledge base and comfort level, rather than trying to grow your trading account from the get go.

Regards,

Tim Sykes
Editor, Penny Stock Millionaires

You May Also Be Interested In:

Timothy Sykes

Tim Sykes is the editor of Tim Sykes’ Weekly Fortunes, a bi-weekly penny stock trader. He also writes the free daily e-letter, Tim Sykes’ Penny Stock Millionaires Tim’s most famous for turning the $12,415 dollars he received at his Bar Mitzvah into more than $1.65 million dollars in trading profits by college graduation. In 2003,...

View More By Timothy Sykes