Friday, May 11, 2007

BEWARE WHERE YOU INVEST YOUR MONEY

This has nothing to do with XNA, game programming, comic books, nor animation, so its miscellaneous stuff. However, I believe is an interesting read for those who plan to invest their money on capital markets, in particular, in penny stocks.

Kiplinger.com has published an article called "The Truth Behind Penny Stock Spam". What's relevant about the article? That it shows the awful truth behind easy money.

In short, I guess you already knew it but if you want to invest money in capital markets, don't let yourself being attracted by spammers, or companies which you barely know or don't know at all.

Always try to analyze the fundamentals of the prospect companies by yourself (in case the proper info is available), read serious analysts' assessments, study the track record of the company, what it offers, if its a known company or not, who are its directors/owners, where it is located, since when, and so on. Otherwise, you face the risk of losing your money in the split of a second!

I'm not saying that you must play always safe, because as you may know the greater the risk the greater the potential reward ... or losses ... but if you want/need to get some "quick" profit just play smartly and the safest as possible, as I assume you do with any other type of investment, in order to avoid the risk of hugh losses because you actually invested in a "ghost" company.

Take the company mentioned in Kiplinger's article, for instance, if you analyze the quote charts, you'll see that it opened in more than USD 7.oo/share when it was first traded in the penny market and then it just followed a slow downward and almost steady path to the current value of USD 0.04 a share. And yes, you're reading right. From riches to rigs ...

Spooky!

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