Tag: Short Selling

Everyone wants to know about the most successful penny stocks in history … They want to believe in the dream of getting filthy rich on cheap stocks — without all the hard work. Keep dreaming. I’ve been trading penny stocks for over 20 years now. I’ve seen a thing or two in the stock market ... What I rarely see is a penny stock becoming a real, legit company. That doesn’t mean it can’t happen. Sometimes, you’ll find a diamond in the rough. I’ve seen a few successful penny stocks in my trading career. Companies have to start somewhere. Some of today’s biggest companies were actually penny stocks back in the day. But they’re exceptions. Not all penny stocks will become big companies. In fact, most fail. That’s why I teach my students to trade penny stocks … not invest in them. To be abundantly clear: I don’t invest in penny stocks or recommend investing in penny stocks. Yes, these results are impressive, but you could never really predict them. For every ‘most successful penny stock,’ MANY will fail. And, as you’ll see, some of these stocks took years — decades — to become successful. I don’t want to wait that long! I like to look for volatility and stocks that follow patterns. That’s what has created opportunities for me and my top students. Still, it’s worth learning from any and every stock. Ready to learn? Let’s dig into what many consider the most successful penny stocks in history... List of Top 10 Most Successful Penny Stocks What makes a ‘successful’ penny stock? You might think it’s a company that started as a penny stock and became a ‘real’ company. There’s more to it than that. A penny stock is any stock that trades under $5 per share. Plenty of billion-dollar companies — big-name companies — once traded at or under $5 per share. We haven’t seen many penny stock companies becoming large-cap companies lately, but it does happen. But remember … Successful companies take years to build — especially if they start small. These companies might be success stories now, but they didn’t make anyone rich fast. That said, let’s look at some of the craziest penny stock success stories over the years... True Religion Jeans (traded on NASDAQ: TRLG) True Religion Jeans is one of the great penny stock stories. It traded under a dollar per share in the early to mid-2000s. But in 2013, the company was acquired by Towerbrook Capital Partners for $32 per share. Long-term investors made a killing on the nearly 5,000% increase. True Religion filed for bankruptcy in 2017 and again in 2020. Apple Inc. (NASDAQ: AAPL) Apple wasn’t always one of the largest tech companies in the world. In fact, hardly anyone knew about the company for years. Back in the early 2000s, AAPL traded for under 80 cents per share — a legit penny stock. As of this writing, AAPL shares trade for over $370. AAPL chart: 20-year, 1-day candles — courtesy of StocksToTrade.com This stock returned over 46,750% — it’s now one of the largest companies in the world. But there was no way of knowing 20 years ago it would become such a success story. And for every company like Apple, there are hundreds of tech penny stocks that fail. Ford Motor Company (NYSE: F) F chart: 20-year, 1-day candles — courtesy of StocksToTrade.com Ford is a $27 billion company. But its stock still only trades around $7 per share as of mid-2020. This makes it an extremely unusual company. While it still hovers near penny stock territory price-wise, it’s also one of the most well-known automobile manufacturers in the world. Why include it in this list? To show a rare example of a situation where the stock price doesn’t say much about the company’s performance. You could consider it a penny stock success story in that it doesn’t seem bound to crash and burn like so many others. Then again, it’s never been a massive mover. It’s not that interesting to me. I prefer huge spikes like Bravada International Ltd. (OTCPK: BRAV). This first green day OTC play was up on news and earned me a $4,375 profit on July 30.* (*Please note: My results, along with the results of my top students are far from typical. Individual results will vary. Most traders lose money. My top students and I have the benefit of many years of hard work and dedication. Trading is inherently risky. Do your due diligence and never risk more than you can afford to lose.) Turtle Beach Corporation (NASDAQ: HEAR) This chart is the exact reason I teach my students to aim for singles and NOT be overly aggressive. HEAR chart: 20-day, 1-day candles — courtesy of StocksToTrade.com Short selling can be a good strategy with penny stocks for some traders ... Many of these scammy low-priced stocks fail. But, like with HEAR, sometimes they don’t. For short sellers, these trades can lead to account devastation. Traders from 2018 might remember this ticker ... Over-aggressive shorts and legitimate news spiked HEAR from under $2 to over $30 per share in months. Study this chart to see exactly what’s possible with penny stocks. Some trades aren’t worth taking. Don’t go for home runs — especially if you short. The wrong trade could end your trading career forever. I mostly avoid shorting these days because of the crazy short squeezes. Respect the short squeeze! Monster Beverage Corporation (NASDAQ: MNST) Yep: way back, before it was a standard offering in grocery and convenience stores, Monster Energy Drinks was a crappy penny stock company. In the early 2000s, it traded for under 6 cents per share... As of this writing, it trades for over $70 per share. Over the years, this ticker returned 142,761%. MNST chart: 20-year, 1-day candles — courtesy of StocksToTrade.com A measly $1,000 investment at its lows would be worth over $1 million today. That’s a good contender for the most successful penny stock. Don’t get FOMO. It took many years for that to grow and easily could have flopped. Mylan N.V. (NASDAQ: MYL) MYL is a pharmaceutical company worth over $8 billion today. The lows on the chart below are just under $6 per share, not technically a penny stock. But this move is impressive. Runs from $6 to over $70 per share don’t happen often. I’d still consider this an example of a successful penny stock. MYL chart: 20-year, 1-day candles — courtesy of StocksToTrade.com Today, MYL trades around $16 per share — not all-time highs. But it’s a good example of a cheap stock that made a name for itself over the course of a few years. However, it’s also lost a lot of value. Remember, hope and hold is not a strategy. Plug Power Inc. (NASDAQ: PLUG) PLUG is a great example of the potential of penny stocks — especially in this crazy volatile market. Check out the chart: PLUG chart: 20-year, 1-day candles — courtesy of StocksToTrade.com You’ve gotta be prepared for this volatility. Get my no-cost resource, “The Volatility Survival Guide,” and study up! PLUG is an example of history repeating. In 2014, it made an initial run from 11 cents to almost $12 per share. In 2020, it’s gone from $3 to over $10 per share. It’s now worth more than $2 billion, putting it in mid-cap stock range. Much of the action is thanks to aggressive short sellers. Don’t short a stock like this every time it goes higher. Because sometimes, it doesn’t stop. And maybe you missed out on PLUG, but you can learn from it... You can also learn the basics of my approach to penny stocks with my student Jamil’s book, “The Complete Penny Stock Course.” It covers so many questions I get about this niche. Advanced Micro Devices (NASDAQ: AMD) If you like computers, you’ve probably heard of AMD. It’s one of the largest chip manufacturers in the world right now. Back in 2015, AMD was trading for under $2 per share. Now, it’s over $70 per share, making it one of the most successful penny stocks. AMD chart: 20-year, 1-day candles — courtesy of StocksToTrade.com AMD now has an $87 billion market cap — making it a large-cap stock. Penny stocks can become real, legit companies. But you gotta be lucky … and wait 20 years. I don’t like to try to guess which companies will make it. New to penny stocks? Get my free guide here. Medifast Inc. (NYSE: MED) MED is also a contender for the ‘most successful penny stock’ list. After trading at under $2.30 per share in 2005, the company hit an all-time high of $246.97 in 2018. MED chart: 20-year, 1-day candles — courtesy of StocksToTrade.com Its 10,000% move is impressive. But it took 13 years. You wanna wait that long? Consider one of my top students, Jack Kellogg. Jack’s in his early twenties, and he’s made over $750K.* He took the time to learn the rules and study. His trading journey has been over a few years … not 10 to 20. Novavax Inc. (NASDAQ: NVAX) I saved one of the most successful penny stocks for last. NVAX had a huge run this year. This pharma play ripped from $3.54 at its low to over $150 per share at its highs — all in under a year, thanks to the crazy volatility of the coronavirus market. NVAX chart: 20-year, 1-day candles — courtesy of StocksToTrade.com The problem? Newbie traders see this and expect all penny stocks and biotechs to do the same thing. Don’t believe the hype! For every 500 penny stocks on the stock market, maybe one or two will do this. More often than not, these companies raise money for their greedy executives through toxic financings. Now, let’s change gears and discuss one of the most successful penny stocks of 2019. Why? Former runners can run again. Penny stocks that spiked in 2019 could run again. So study up and prepare. Here’s one penny stock that went big in 2019 that might be worthy of your watchlist... The Penny Stock That Went Big in 2019 Snap Inc. (NYSE: SNAP) SNAP chart: 20-year, 1-day candles — courtesy of StocksToTrade.com Back in 2019, SNAP opened the year around $5 per share. By its highest point in 2019, SNAP traded at more than $18 per share ... It’s since gone over $26 per share in 2020. This isn’t the most volatile penny stock or one I’d be interested in trading. However, you can learn from a stock like this. Study this so you can see patterns in the chart. It could help you spot similar action in another company with similar growth. How to Find Penny Stocks Before They Explode You probably won’t find the next Amazon or Apple by sifting through the penny stock market ... But you can find stocks that can move 100% or more in a single day. These are the plays that my students and I like to trade. Over my 20-year trading career, I’m up over $5.5 million in trading profits. I didn’t do it by getting lucky with the ‘most successful penny stocks.’ I did it by being prepared and reacting rather than predicting. My strategy is to find plays before they make their full move. My go-to weapon for finding plays? StocksToTrade.This software is essential for trading penny stocks. There are two key tools on StocksToTrade you need to use: Breaking News feature Stock Screener These features help me find hot plays every day. The Breaking News chat room alerts me to important penny stock news as it comes out. I’m better primed to get in on plays as they’re breaking out. In fact, roughly half of my recent trades have been a direct result of the Breaking News feature. A good stock screener has many great tools, including scanning for stocks that meet your criteria. Check out this video where I walk you through how to make a watchlist: 2 Hot Penny Stocks to Watch in 2020 Genius Brands International Inc. (NASDAQ: GNUS) GNUS chart: 20-year, 1-day candles — courtesy of StocksToTrade.com Have I mentioned that history repeats? The promoters for GNUS did a great job the first time. Who knows … Maybe they’re done pumping it. I wouldn’t expect this stock to go back near highs if it ran again, but that doesn’t mean another crazy move is out of the question. Given the overall attention this ticker has gotten in the past, it could be a penny stock worth watching in 2020. Exela Technologies Inc. (NASDAQ: XELA) XELA chart: 20-year, 1-day candles — courtesy of StocksToTrade.com XELA is a former runner that keeps getting more and more attention each time it moves. Who knows if it can run again. But with the amount of attention this ticker gets each time it gaps up, it could. This is another stock to watch in 2020. Frequently Asked Questions The Bottom Line on the Most Successful Penny Stocks Penny stocks have insane potential — but few will make it into the ‘most successful penny stock’ hall of fame. Most penny stocks won’t work long term because of greedy CEOs and sketchy business plans. Then there are promoters who pump penny stocks to help get a quick move … They cash out while subscribers are stuck holding a losing stock. That’s why I teach my students to trade — not invest. And I never recommend following alerts. The alerts I send to my students are to teach the process. My goal is to teach traders to be self-sufficient. Don’t play guessing games in the market. Instead, learn to day trade and focus on small gains. If you’re dedicated to learning, consider applying to my Trading Challenge. What’s the most successful penny stock you’ve ever seen? Let me know in the comments below!

Tag: Short Selling

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