Review of gold stock price::What Is Gold Shore Gold Stock Letters
If you are "playing the pennies", that is, investing in penny stocks, by now you have seen companies that profile certain penny stocks. They are usually online and sometimes in print. It seems that I get a "hot pick" in the mail almost daily, telling me in no uncertain terms that they have the "stock play of a lifetime" for me. That makes me feel so special! Well, actually, it doesn't and hasn't for a number of years. When I first started reading the snail mail versions, they really did arouse my curiosity. The rationale for a particular stock was backed up by loads of facts and data, most of which could be verified. However, there was a tenuous connection between the Canadian gold stock and the data presented in the advisory newsletter. No matter what the product or service is for the penny stock company, the newsletter will slip in industry data to prop up the potential value of the stock. Getting back to our imaginary Canadian Gold Mining Company, you will see that they are about to begin a geological exploration of the land that they have leased. They also have "discovered" trace elements of gold on the property, and extrapolate that to a mother lode of gold on the land. They will begin digging soon and expect to have the results in the near future. Tied to this company's plans are real data about gold and gold mines. They will tell you that gold is in a bull market, how profitable this land could be at the current price and future prices of gold. The kicker is when they tease you with "if you invest $1,000 in this right now, your investment could be worth ten times that in one year!" You always have to "get in on the ground floor". The copywriter does a superb job of presenting a picture of you and your future wealth and instilling a real sense of urgency. "You must act now or be left behind!" What you don't know is that this penny stock is an empty shell of a former company that sold women's shoes. You think I'm kidding? I'm not. Shell companies are constantly being sold and being reinvented, as it's much cheaper and easier to get one listed on the over the counter stock board and start issuing stock. What you also don't know is that there are only two employees at the time, with no revenue and no cash on hand. Why? Because penny stocks that trade on the Pink Sheets are exempt from reporting their operation to the public. Back to the online (or print) newsletter: before you even read the article about the stock they are touting, go to their disclaimer. In print versions it's usually on the back page and in microprint. I kid you not. If you are reading an online version, look for the disclaimer at the bottom of the web page. Either way, it's a legal requirement for them to post disclosure about their relationship to the stock they are recommending. You will usually see that the newsletter publisher has been compensated to "promote" company XYZ, sometimes in cash, sometimes in shares of the stock, sometimes a mixture of both. There it is: the company is paying a promoter to showcase their stock. It's in black and white for you to see. The same holds true for the online promoter. This doesn't necessarily mean that it's bad, but it also doesn't mean that the newsletter is touting the stock totally on its merits and value. Online interviews with stock company CEOs are also paid in advance by the CEO to get exposure. And don't expect hardball questions about the company's finances, etc., by the host. Remember, the company is paying for the exposure and the interview is normally scripted in advance. What do you take away from all of this? If it's a penny stock, particularly if trading on the Pink Sheets, consider it a scam first and then do some "due diligence" of your own to find out if it has any merit. Pay no attention to what is said on stock chat forums, as the company itself may be on there under phony identities and posting wonderful information on the stock. My other article "How to Intelligently Trade Penny Stocks" (AC article # 153995) goes into more depth in this area. Disclosure is what it's all about. Snoop and learn. It's your hard-earned money involved here. Good luck! |
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