Many people mistakenly believe that just because a penny share price is already so low, it cannot possibly go any lower. Consequently, they feel that the only way for these shares must be up.
In reality, though, the reverse might be true. Any share can fall to zero, which means that you could lose all your money. In fact, penny shares are probably more likely to do this because they are smaller companies. To average down penny share is no wise, the more you average down the lost get bigger. A snowball is the best analogy for compounding the lost. As you roll the ball through the snow, the surface area gets bigger. The more surface area on the snowball, the more snow it picks up, the lost increase faster.
Thing is, just because the share price is so low does not automatically give it more potential to rise. Instead, it is how the company will perform that determines this.
I agree with Rock that the company performance is very important.. the Q3 report will be out by early of Nov, we will see what the company doing with the recent bonds money..
Rock wrote: Many people mistakenly believe that just because a penny share price is already so low, it cannot possibly go any lower. Consequently, they feel that the only way for these shares must be up.
In reality, though, the reverse might be true. Any share can fall to zero, which means that you could lose all your money. In fact, penny shares are probably more likely to do this because they are smaller companies. To average down penny share is no wise, the more you average down the lost get bigger. A snowball is the best analogy for compounding the lost. As you roll the ball through the snow, the surface area gets bigger. The more surface area on the snowball, the more snow it picks up, the lost increase faster.
Thing is, just because the share price is so low does not automatically give it more potential to rise. Instead, it is how the company will perform that determines this.
Unfortunately all this is just empty rhetoric to those who have fallen into a state of unconditional love for this stock. It can do no wrong. One remains in a constant state of denial until it is finally too late.
Yes, I do agreed that on the surface, there "appeared" to be red flags like some of you had pointed out. But what is underneath the surface? Many are guessing only.
Things are going fine, there is a trade fair in Shanghai and more shops will be opened very soon.
Vested and have no intention of selling. Only time will tell.
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