Penny stocks can be volatile and speculation- driven;A wrong move can cost the investor dearly. But there are also less risky lower- liners with reasonable fundamentals. We take a look at six of them. THE market has been seeing active trading of the lower liners, especially penny stocks, on Bursa Malaysia. In fact, these small- cap stocks, as indicated by the FBM Small Cap Index (FBM SC), have performed much stronger than those on the benchmark FBM KLCI (FTSE Bursa Malaysia Kuala Lumpur Composite Index). The FBM SC has outperformed the FBM KLCI and even the FBM 70 Index since end- September by 7.0% and 2.2% respectively (see Chart 1).
The medical marijuana industry believes offering penny stocks to investors is the path to legitimacy and growth. Investment analysts call that a half-baked idea.
THE RECENT KEEN INTEREST IN penny stocks led by Harvest Court Industries Bhd has lit up our stock market. At the same time, it has raised the red flag, considering that these stocks have risen without much or any fundamental backing. This is not surprising as given their small capitalisation, penny stocks are easy targets of speculative activities or worse, manipulation, making it harder for investors to separate the good offerings. News Editor Gurmeet Kaur looks at what is causing this frenzy while writer James S analyses six penny stocks worth watching.
To the uninformed, penny stocks (stocks that trade for less than $5 per share) can be appealing. Imagine you have $2,000 to invest. You could buy about 30 shares of a $65 stock, 110 shares of an $18 stock or 15,000 shares of a 13-cent stock. Doesn't having 15,000 shares sound much better than owning 30 or 110 shares? It shouldn't. Penny stocks often are tied to small, unproven companies with no track record of solid financial performance. Worse, these stocks are among the easiest to manipulate and often are manipulated by scam artists. Many quickly plunge in value.
AS of March 30, out of 72 counters listed on Mesdaq, only 10 were trading above RM1. In short, as much as 86% of Mesdaq counters can be classified
The main goal of this study is to analyze a sample of self-underwritten Initial Public Offerings (IPOs) where the going public process is conducted without the participation of any investment bank or underwriter at all. We test the hypothesis that the major incentive to self-underwrite is to maximize the proceeds from the IPO.The firms in this study are considered self-underwritten if and only if they explicitly describe their own IPO as such in the registration statement and the prospectus. This definition is completely new, since most previous academic papers have considered as those where the issuer is an investment bank that also participates in its own IPO. The main conclusion of this study is that there are no significant differences on the level of underpri...
... Self-underwritten IPOs of the subsamples of penny and nonpenny stocks experience zero underpricing. ...
IT is a paradox of life that invaluable diamonds are often found in hard- to-find spots. But to discover this source of wealth among seemingly barren landscape requires a large dose of skill and a touch of luck. This appears to be the case for investors who have been involved in the Mesdaq market in the last 12 months or so. The law of probability says the market must have its fair share of gems despite a harsh landscape. The Mesdaq market chalked up an impressive 46 Initial Public Offerings (IPOs) in 2005 compared to only 26 in 2004 - a massive jump of 77%. The reason being many young technology-based start- ups have chosen to list on the Mesdaq to raise capital for their business growth. The lower cost of IPO and less stringent requirements also help. As such, surely the Mesdaq market...
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