| Take some time grazing through the business or | | | | do (on occasion). |
| investing section of your favorite local bookstore and | | | | Though really... who knows how far a downturn can |
| you'll discover that virtually every literary business or | | | | go? Timing is equally as important. Buy a penny stock |
| stock guru has some great secrets (some | | | | too soon and you risk some financial embarrassment. |
| simple...some not) that (apparently) can help you bust | | | | Hmmm...embarrassment now, versus potential gain |
| the penny stock market wide-open. | | | | later. |
| For example, Warren Buffett advises: First, don't lose | | | | No matter how you slice it...scandals and disasters do |
| money. Second, never forget rule number one. And | | | | open the door to potential bargains. Where to find |
| Third, wait for the perfect investment and do | | | | the bargains? It may sound simple... but watch the |
| nothing until then. | | | | news... read the paper. Do your own due diligence and |
| Ben Graham (Warren Buffett's teacher) advised to | | | | ascertain whether or not the market over reacted |
| buy stocks below working capital or below working | | | | and what the bottom price is you're willing to pay. |
| capital less all debt. Peter Lynch used to say, follow | | | | As one analyst opined, "If you can do that, you can |
| the earnings. If they rise, so too will the stocks. | | | | make money when everyone else is losing their |
| Seth Klarman suggests you have two things: guts | | | | heads." |
| and patience. For that is what you will need to | | | | Have a good sense of what you're looking for and |
| withstand the market panics and plunges; which is | | | | be honest with yourself about your own financial |
| when Klarman recommends you buy. | | | | knowledge. Be realistic in your expectations of profit |
| The market, he says, is fond of making mountains | | | | and return. It's easy to get carried away when things |
| out of molehills and making regular business setbacks | | | | are flying high... and to panic when they fall off |
| appear as catastrophes. Meaning... the vast majority | | | | abruptly. Trust me. |
| of penny stock panics are overdone. In fact, that is | | | | While this may seem pretty obvious...it never is when |
| when Klarman says you should buy. | | | | you're in the heat of the moment. And for penny |
| What if there are no panics to buy into? You must | | | | stock investors that are accustomed to market |
| have patience. And yes...that is easier said than done. | | | | volatility...those moments are not as rare as you |
| While "guts" are recommended...how many of us | | | | might think. |
| really have what it takes to buy penny stocks in the | | | | Still, after everything's said and done...when it comes |
| midst of crashes, disaster and downturns? I certainly | | | | to penny stocks...there's never reward without risk. |