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A friend of mine asked me to invest in one.
It was for a diet drug. I looked into it and looked up the company owners. This was their fifth rodeo. Red flag! They were sued when they cashed out of old companies at height of price and everyone else got screwed. Red flag!
I told my buddy about my findings. Told him to run and when to run. Basically he bought in at 10 cents a share with $10000 minus fees. But for sake of math we'll say he owned 100,000 shares.
It went up to 70 cents. He now had $70,000. I told him to sell $25000 minimum. But really he should sell $50,000. He didn't listen. Said, no way! It's projected to go to $1.80 or more!
The next day it opened and went to $1.25 for about 5 minutes. I told him to sell. At least sell half! No! It's going to keep going!
Whaaaam!
Owners cash out. Pumpers cash out... People like my buddy see the price plummeting, 90 cents, 80 cents, 45 cents, 10 cents in a matter of minutes. I tell him to sell!
No! It will rebound!
By days end it was .0007 per share.
He had $70.
He still wouldn't let it go. Week later .000015 per share and it's dropped, shuttered, bankrupted.
He lost all of his money.
So as somebody eluded to earlier... You have to be in with the pumpers and know when the dumps coming. Or just use common sense and look at my example.
Had he listened to me: $50,000 on first sale.
On second: $35,000 on early next day trade.
Up $75000 instead of left with nothing.
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